Colombia scam suspect seized
(english.aljazeera.net) The accused head of a Colombian pyramid finance scheme has been captured and extradited from Panama to face charges over a growing financial scandal that has sparked deadly clashes and caused thousands of investors to lose money.
David Murcia, head of financial agency DMG, was seized in Panama as he tried to flee into Costa Rica, Panama police said.
He was then extradited to Colombia, where he and his six directors face charges including money laundering and other financial crimes, police said.
Alvaro Uribe, the Colombian president, has declared a state of emergency to crack down on the illegal investment schemes, which have ensnared millions of Colombians in recent years.
DMG reportedly made millions of dollars annually by offering about 200,000 investors high interest rates, as high as a 300 per cent returns over six months.
Such pyramid schemes can offer dramatically high returns by using later investors' money to pay off those who invest first.
However they collapse when the flow of incoming money is not enough to pay the growing pool of investors.
Drugs 'link'
Thousands have lost their savings on such reported scams that promised high interest rates, real estate deals and debit cards to buy consumer goods.
Authorities are also said to be examining possible links between the finance agencies and Colombia's multibillion-dollar cocaine trade.
Last week furious clients stormed and looted local DMG branches in rioting that left 13 towns under police curfew and two men dead.
Officials seized 92.4 billion pesos ($42 million) from 68 of the company's offices and arrested 52 employees, police told AP.
Later on thousands of DMG depositors took to the streets this week to protest a decision by Uribe to shut the stores.
Lawyers for DMG told Reuters the company's managers were innocent and were ready to co-operate with the government's investigation.
Another company, Proyecciones DRFE, collapsed last week amid news its owner had left the country, leaving about $270 million of investments in limbo.
