Political Skullduggery

I guarantee that if Chiquita had been paying protection to FARC, rather than the right-wing AUC, the ambiguity about the legality of the act wouldn't have been in question.

On April 24, 2003, a board member of Chiquita International Brands disclosed to a top official at the Justice Department that the king of the banana trade was evidently breaking the nation's anti-terrorism laws.

Roderick M. Hills, who had sought the meeting with former law firm colleague Michael Chertoff, explained that Chiquita was paying "protection money" to a Colombian paramilitary group on the U.S. government's list of terrorist organizations. Hills said he knew that such payments were illegal, according to sources and court records, but said that he needed Chertoff's advice.

Chiquita, Hills said, would have to pull out of the country if it could not continue to pay the violent right-wing group to secure its Colombian banana plantations. Chertoff, then assistant attorney general and now secretary of homeland security, affirmed that the payments were illegal but said to wait for more feedback, according to five sources familiar with the meeting.

Justice officials have acknowledged in court papers that an official at the meeting said they understood Chiquita's situation was "complicated," and three of the sources identified that official as Chertoff. They said he promised to get back to the company after conferring with national security advisers and the State Department about the larger ramifications for U.S. interests if the corporate giant pulled out overnight.

Sources close to Chiquita say that Chertoff never did get back to the company or its lawyers. ...

Chiquita's executives left the meeting convinced that the government had not clearly demanded that the payments stop. Federal prosecutors, however, are now weighing whether to charge Hills; Robert Olson, who was then Chiquita's general counsel; former Chiquita CEO Cyrus Friedheim; and other former company officials for approving the illegal payments, according to records and sources close to the probe.

The company has already pleaded guilty to making $1.7 million in payments to the United Self-Defense Forces of Colombia (AUC), and it agreed to pay a $25 million fine. But last week, lawyers for the former Chiquita executives sent letters to the Justice Department, asserting that their clients did not intentionally break the law but believed they were waiting for an answer from the highest levels of the Bush administration. ...

But legal sources on both sides say there was a genuine debate within the Justice Department about the seriousness of the crime of paying AUC. For some high-level administration officials, Chiquita's payments were not aiding an obvious terrorism threat such as al-Qaeda; instead, the cash was going to a violent South American group helping a major U.S. company maintain a stabilizing presence in Colombia.

The prosecution first centered solely on Cincinnati-based Chiquita, the world's largest banana producer and one of its largest food-distribution companies. It has operations in 70 countries and 25,000 employees, and has been in Colombia for more than a century, dating to the days when the company was called United Fruit. [see also 1954 Guatemalan coup d'état]

(...)

On April 24 [2003], the company executives met with Justice officials, including Chertoff. They disclosed the payments and Justice officials said they were against the law. Hills said he agreed, but stressed that Chiquita would have to withdraw from the country if it did not pay AUC, and noted this could affect U.S. security interests in that region.

That's when, according to the five sources, Chertoff acknowledged that the matter was complicated, and said that he would get back to them after conferring with other administration officials.

A week later, Hills and Olson told the company board's audit committee that Justice had advised them that there would be "no liability for past conduct" and that there was no "conclusion on continuing the payments," according to a summary of the case filed by the prosecution. The company authorized new payments to AUC starting on May 5.

The astonishing thing about this is that the Justice Department did eventually bring charges against Chiquita. The publicity -- especially in Latin America -- surrounding the controversy is what forced DOJ's hand.