Former Cuban Vice-Minister Faces 20-Year Sentence

By Café Fuerte

Vahe Cy Tokmakjian in his days as a successful and respected businessman in Cuba.
Vahe Cy Tokmakjian in his days as a successful and respected businessman in Cuba.

HAVANA TIMES — The trial of Canadian businessman Vahe Cy Tokmakjian, accused of corruption, traffic of hard currency and tax evasion in Cuba, ended with a guilty verdict and a petition to incarcerate former Cuban vice-minister Nelson Ricardo Labrada for 20 years, Cuban government authorities reported.

According to a note published by Cuba’s official newspaper Granma, during the trial, held at Havana’s Provincial Court from June 9 to 21, charges were brought against Tokmakjian, Canadian businessmen Marco Vinicio Puche Rodriguez and Claudio Franco Vetere, as well as against 14 high Cuban government officials and executives.

The press note is the first official statement about the Tokmakjian case and the proceedings against him published in Cuba.

According to the report, charges of bribery, acts damaging of the economy and employment, falsification of bank and commercial instruments, fraud, traffic of hard currency and tax evasion were brought against the 17 accused.

Considerable Financial Damage

“The Attorney General’s Office of Cuba accused Vahe Cy Tokmakjian of using fraudulent and corrupt mechanisms to secure benefits in negotiations with Cuban entities, causing considerable financial damage to our economy, acting as a financial intermediary without due authorization, taking large sums of money out of the country illegally, altering account books and sworn statements with a view to evading tax obligations and making monetary payments to several employees who performed duties different from those legally authorized or who had not been hired by domestic companies,” the official note explained.

The prosecution asked for a 15 year prison sentence for Tokmakjian, president of the Tokmakjian Group, and a 20 year conviction for Labrada Fernandez, who served as vice-minister of Cuba’s former Ministry of Sugar until his arrest in September of 2011.

The other Cuban officials implicated in the crimes (for whom the prosecution requested between 8 and 12 years in prison) are:

1. Manuel Heriberto Fernandez Santiesteban (Ministry of Sugar)

2. Leonardo Fidel Delgado Dorta (Ministry of Sugar)

3, Jorge Luis Machado Perez (Ministry of Sugar)

4. Jose René Rubio Escobar (Ministry of Sugar)

5. Alberto Cirilo Panton Grahan ( former general manager of Cubaniquel)

6. Ernesto Gomez Cumplido (former president of Ferroníquel Minera S.A.)

7. Fidel Penin Oliva (former Ministry of Basic Industry)

8. Jorge Luis Melo Reyes (former president of the Asociación Economica Internacional CISTUR, attached to the Ministry of Tourism)

9. Edmundo Javier Cabrera Díaz (Tokmakjian Group branch in Cuba)

10. Antonio Gilí Gonzaez (Tokmakjian Group branch in Cuba)

11. Boris Ernesto Barber Velis (Tokmakjian Group branch in Cuba)

12. Armando Enrique Martinez Ganfo (Tokmakjian Group branch in Cuba)

13. Elsa Fernandez Proenza (Tokmakjian Group branch in Cuba)

During the proceedings, the prosecution called the foreign companies Tokmakjian Group Inc; Tokmakjian Limited, C.Y.M.C. and Tokmakjian International Inc. to the stand as liable third parties.

According to the report, the declarations of the accused and numerous items of evidence, testimonies and statements by experts of the Treasury Inspector’s Office, the National Tax Administration Bureau (ONAT) and the Ministry for Foreign Trade and Investment were considered during the oral hearing.

The prosecution also asked the court to request that the accused pay over US $91 million for damages caused to several Cuban entities and ONAT. This sum will be covered, in part, with the assets and money confiscated from Tokmakjian and his companies during the proceedings.

Sentencing

The proceedings have concluded and the court will hand down the sentences in the coming days. The information on the Tokmakjian case published by the press sets it apart from the trial of another important Canadian businessman, Sarkis Yacoubina, tried and convicted to nine years in prison on similar charges (and released this past February). The trial of Yacoubian was not reported on by Cuba’s official media.

Tokmakjian, 74 years old and of Armenian origin, has been under arrest since September of 2011, after Cuban State Security agents seized and shut down the locales of his firm on the fourth floor of the Barcelona building at Havana’s Miramar Trade Center.

In April of 2013, during investigations, the Cuban government officially shut down the operations of the Tokmakjian Group, one of the largest foreign companies to have operated in Cuba over the past 25 years.

Based in Ontario, Canada, the Tokmakjian Group was second only to Sherrit International in terms of the scope of its financial operations in Cuba. It took in some US $ 80 million annually through the sale of construction and mining equipment.

The company was also Hyundai’s exclusive distributor in Cuba and had partnered up with two other companies to replace the engines of Soviet-era equipment on the island.

The Tokmakjian Group has filed a suit against the Cuban government before the Supreme Court of Justice of Ontario, Canada. The company alleges that the assets of the Tokmakjian Group were confiscated illegally and accuses Cuban authorities of interfering in the company’s commercial dealings with its clients.


10 thoughts on “Former Cuban Vice-Minister Faces 20-Year Sentence

  • March 23, 2015 at 2:49 pm
    Permalink

    Good to know there is a country where the Law applies to all not just the poor!!!

  • July 5, 2014 at 7:04 pm
    Permalink

    “The company alleges that the assets of the Tokmakjian Group were confiscated illegally and accuses Cuban authorities of interfering in the company’s commercial dealings with its clients.”

    That statement is an understatement irony and massive cluelessness. The so-called “Cuban authorities” illegally confiscated the assets of the entire island. They have interfered with the Cuban people’s dealings for 55 years.

    If you go into business with gangsters don’t be surprised when you get burned.

  • July 3, 2014 at 11:10 am
    Permalink

    I did check the link. Being in the 63rd. percentile in the corruption index is not a good thing. But if claiming a ranking higher than Mexico and Colombia works for you…. To your point about the impact of corruption, it depends on the system of corruption. BRIC countries still seek high levels of production and efficiency. Corruption in these countries serves to make this process costlier. In Cuba, high production and efficiency are an anathema to socialist thinking. Mediocrity is the path more often chosen. When you control cost then corruption will impact quality and diminish effort. In Cuba, corruption is a far more deadly sin.

  • July 3, 2014 at 9:59 am
    Permalink

    I think you should have checked the link you posted. Cuba ranks as 63rd of 175 so that would put it in the third least corrupt countries in the world. It ranks worse than the US and western Europe, but better than most other countries in Latin America including your star pupils Mexico and Columbia. I’m not trying to downplay – it is a serious problem in Cuba.

    There is the caveat that the stats measure perception of corruption, not corruption itself so to some extent it depends if the interviewee believes an activity is corrupt or not. Also, it seems that not all types of corruption affects the economy adversely. All the BRIC countries are heavily corrupt.

  • July 2, 2014 at 9:11 pm
    Permalink

    This recent letter from another businessman accused, tried by the
    Castro “government” might shed some light into this current trial! And
    lets not forget the “transparency” of the Castro Oligarchy’s Justice
    System!

    THE ECONOMIST: The risk of doing business – Aug 13th 2013,

    WE HAVE received the following letter from Stephen Purvis, a British businessman who was detained in Cuba for 15 months:

    Dear Editor,

    I enjoyed reading about my misfortunes in the Economist, albeit many months after publication and in the company of fellow inmates in the Cuban high security prison, La Condesa. I would ask you to correct the impression that you give in the May 9th 2012 edition and subsequent
    articles that I was accused and detained for corruption.

    During my 8 month interrogation in the Vila Marista I was accused of many things, starting with revelations of state secrets, but never of corruption. After a further 7 months held with a host of convicted serious criminals and a handful of confused businessmen, most of whom were in a parallel predicament to mine, I was finally charged and sentenced for participating in various supposed breaches of financial regulations. The fact that the Central bank had specifically approved the transactions in question for 12 years, and that by their sentencing the court has in effect potentially criminalised every foreign business investing or trading in Cuba was considered irrelevant by the judges. I am thankful however that the judges finally determined that my sentence should not only have with a conditional release date a few days before the trial thus conveniently justifying my 15 months in prison, but, bizarrely was to be non-custodial. So my Kafkaesque experience at the sharp end of Cuban justice ended as abruptly as it began.

    http://www.economist.com/blogs/americasview/2013/08/foreign-investment-cuba

  • July 2, 2014 at 10:40 am
    Permalink

    In your rush to bash the US you continue to ignore FACTS. Cuba is among the world’s most corrupt countries. http://www.transparency.org/cpi2013/results
    Yet, you proffer that politicians that you obviously dislike would fare worse in Cuba than they would in the US which, through an independent media and judicial system, is far more likely to prosecute wrongdoing. While I agree that the list of characters you presented aren’t on anybody’s list for sainthood, they don’t compare to the ‘resolving’ that goes on every day at all levels in Cuba. And to the point about where crooks end up in the US? In Cuba they end up as dictators.

  • July 2, 2014 at 7:54 am
    Permalink

    With its failures and shortcomings, Cuba deals with its crooks harshly, exemplary and has made it known since 1959, that whomever is caught in one of these dirty tricks, will end up in jail, removed from their post and will never become a governor, Senator, Congressperson, Lobbyist or Mayor, as unfortunately we see happen everyday in the US.

    Had Rumsfeld, Cheney, GWB, Wolfowitz, Condoleezaa and all others, whose perfidious actions led this country into the middle east debacle, which have caused the destruction of Iraq, Libia, Afghanistan, Syria, Yemen etc., millions of dead, wounded and maimed had the misfortune of living in Cuba, their names would be engraved in headstones, never to repeat their crimes, as Cheney is trying to do on FOXX TV, Wall Street Journal and at the Heritage Foundation.

  • July 2, 2014 at 7:06 am
    Permalink

    Cy probably became too relaxed and angered the owners of Cuba (military bosses) by not kissing their boots fast enough. He and everybody else, who are doing business in Cuba, know that it is extremely dangerous for foreign investors. It is not the first time the foreign investors are imprisoned in Cuba when the Cuban government is bankrupt once again. Every time they need the money they go after the assets of foreign investors. There were at least 20-30 other cases of foreign investors being jailed and their assets confiscated in the last 10 years. The potential foreign investors ready for venture in Cuba must smarten up before they get locked up in Cuban jails. Cubans must smarten up too and get hell out of this toxic environment which will kill them sooner or later if not in jail, then in misery.

  • July 2, 2014 at 7:01 am
    Permalink

    I am not so sure. Greed is deaf and blind. Would-be investors in Cuba will likely believe that they are smarter than the Canadians and won’t get caught. Keep in mind that even to consider investing in Cuba says a lot about your decision-making. Investing in Cuba means that there must not have been any good deals left in North Korea or Syria.

  • July 1, 2014 at 9:54 pm
    Permalink

    And Cuba is seeking more foreign investment!
    GO TO JAIL!
    Invest in Cuba at your peril !

Leave a Reply

Your email address will not be published. Required fields are marked *