Mexican TV Mogul Faces US Fraud Charges

06 January 2005

Mexican broadcasting company TV Azteca and its controversial chairman Ricardo Salinas Pliego are at the centre of civil fraud charges brought by US financial regulator, the Securities and Exchange Commission.

The country's second largest broadcaster is accused by the SEC of irregularities which allegedly netted chairman Salinas Pliego $109 million (€82m, £58m) at the expense of other shareholders. He is indicted along with two colleagues and the broadcaster's parent company, TV Azteca Holdings.

The accusations involve a 2003 debt transaction in which Salinas Pliego and a partner are said to have bought debt owed by Unefon, a TV Azteca cellphone subsidiary, at a heavy discount and resold later at full value to the company. The SEC says the pair failed to inform shareholders they were behind the deal.

Billionaire Salinas Pliego thunders that the charges are "false, in bad faith and discriminatory" and pledges to fight them. It is not the first time his reputation has been threatened. He bought the TV network during Mexican privatisations of the early 1990s, using money from the incumbent president's brother.

The SEC is demanding Salinas Pliego gives back the $109m and could prevent him from being director of any US-traded company.

Data sourced from Wall Street Journal Online; additional content by WARC staff