Peruvian Ex-Spy Chief's $50 Million Stash Uncovered ; Swiss Consider Pressing Money-Laundering Charges against Montesinos, as Peru Begins Investigation

Article excerpt

In the most significant sign to date that Peruvian president Alberto Fujimori has severed ties with his controversial former adviser, the Peruvian government has appointed a special prosecutor to investigate the origins of some $50 million Vladimiro Montesinos has stashed away in Swiss bank accounts.

The decision, announced Thursday, came after the Swiss Embassy in Lima informed Peruvian authorities of the three accounts, which have been frozen.

The Swiss government is considering opening criminal proceedings against the former intelligence chief for money laundering.

President Fujimori has been under international pressure to distance himself from Mr. Montesinos, whose continued presence is seen as destabilizing Peru's already tenuous attempts at democracy.

The Peruvian opposition has long claimed that Montesinos, one of the country's most-feared and -hated men, spent his decade as Fujimori's right-hand man getting rich from drug trafficking, arms dealing, extortion, and other illegal activities.

Despite numerous accusations, Montesinos, widely believed to control key judges and prosecutors, always managed to keep the law at bay. Two previous investigations into his personal fortune were shelved by the attorney general.

In September, prosecutors took less than a week to close an investigation of a bribery scandal that forced Fujimori to cut short his mandate and call new elections, set for next April. The scandal centered on a video showing Montesinos paying an opposition congressman $15,000, apparently to switch allegiance to Fujimori.

This time, Montesinos may not escape unscathed. Attorney General Blanca Nelida Colan, a staunch Montesinos defender, resigned Friday morning. …