Lezo Case Corruption Lingers Amidst Spain-Colombia Dispute Over Barranquilla’s Triple A
The ‘caso Lezo’ corruption scandal, which investigates a network of politicians and executives allegedly profiting from the international expansion of Canal de Isabel II, continues to fester like an unhealed wound. This ongoing drama unfolds amidst a bitter struggle between Colombia and Madrid for control of Triple A de Barranquilla, a vital water management company.
Triple A, formerly owned by the Madrid public utility, was expropriated in 2022. The reason? Colombian prosecutors suspected that the company was paying for supposedly non-existent technical consultancies to generate illicit kickbacks. Since then, both parties have been locked in a dispute at an arbitration court (CIADI).
New Legal Scrutiny: Illicit Funds and Corruption in Colombia
In response to Colombia’s arguments, Canal de Isabel II has commissioned a legal study to clarify whether the criminal charges being investigated by Spanish justice in the Lezo case include an analysis of whether the funds used to acquire Triple A “originated from illicit sources.” Furthermore, the study aims to determine if the Spanish court is “analyzing the alleged corruption in the investment in Colombia in relation to the technical assistance contract, or the violation of any Colombian law.”
A recorded conversation sheds significant light on the origins of this conflict.
The Panama Papers and a Fateful Conversation
Hotel Villamagna. Madrid. July 21, 2016. Edmundo Rodríguez Sobrino, president of Inassa and right-hand man in America to Ignacio González (former regional president and Canal de Isabel II chief), found himself in a tense discussion with José Manuel Daes, also known as Yuyo, a prominent Colombian contractor and businessman. Rodríguez Sobrino was recounting the regional government’s reaction to his name appearing in the Panama Papers as the owner of several companies in Hong Kong (a tax haven until 2012) managed by the Mossack Fonseca law firm.
“They want to dismantle everything,” Daes commented, surprised by the government’s plan to sell Canal’s companies in Colombia, Brazil, Peru, and the Dominican Republic.
Rodríguez Sobrino replied, “Dismantle everything, well, in fact, Yuyo, a year ago, that was billing 320, 330 million dollars.” When asked how much the Canal received, he stated, “The Canal received, I’ll tell you the total figure, the Canal received 65 million. That’s what it received.” Confused, Daes responded, “It doesn’t make sense.” Rodríguez Sobrino elaborated, “Look, it invested 95 million in an operation you know about where 25 million was stolen… Canal collected 65 million in dividends that I gave it… It has plenty everywhere.”
This conversation, recorded by investigators and included in the Lezo case summary, is a key piece of evidence fueling the current conflict and intensifying suspicions from both Spanish and Colombian authorities.
The “Technical Assistance” that Never Was
By late 2017, Colombian authorities argued that Canal de Isabel II, through Inassa, had been charging Triple A for technical advisory services that were never provided. Any lingering doubts, according to Colombian investigators, were dispelled by a later statement from Rodríguez Sobrino to the judge.
“Canal was charging for technical assistance, in parentheses, that it didn’t provide, that it didn’t provide, and it charged for it monthly,” he declared when questioned about the Dominican Triple A, another company in the group, specifying that this system operated across “all” of the group’s companies. He emphasized, “The Canal was charging monthly about two million euros for technical assistance that it never provided, that it never provided. It was a hidden pact between shareholders… That money was collected by the shareholders to pay less taxes.”
Expropriation and Ongoing Legal Battles
This alleged diversion of funds, coupled with the need to ensure the essential water treatment and purification services provided by Triple A to several Colombian municipalities, underpinned Colombia’s decision to expropriate the Spanish company’s shares, invoking an anti-drug trafficking law. Madrid’s attempts to justify the existence of these consultancies with various expert reports have been dismissed. A report by the Grant Thornton consultancy on the advisory contract between Canal and Inassa (2002-2033), which stipulated Inassa receiving 4.5% of Triple A’s monthly revenue, claimed that “the Canal and Inassa carried out said works.” However, the two parties have been in open conflict for almost a decade, and Madrid’s commissioning of a legal report, valued at 36,300 euros, is merely the latest development.
The study aims to counter reports presented by Colombia and clarify, among other points, “whether the Colombian State or the Barranquilla City Council, if harmed by the investigated events, would have had standing to appear as injured parties in the criminal proceedings (of the Lezo case in Spain).”
Madrid’s Defense and the Broader Failure of Expansion
A spokesperson for the Community of Madrid government states, “The Republic of Colombia or the District of Barranquilla have not appeared in the proceedings in Spain, nor is there any record that they will formalize their appearance as injured parties.” They continue, “In the international arbitration, references to actions and documents linked to a proceeding in Spain have been introduced due to this circumstance.” They clarify, “It is common in these cases to seek technical reports from independent specialists to describe procedural situations.” The spokesperson details, “The purpose of the contract is to commission an independent expert in Spanish law to prepare a technical-legal report to strengthen Canal Extensia’s response to reports and allegations presented by the other party in the international arbitration.”
This conflict highlights the broader failure of Canal de Isabel II’s national (Lanzarote and Cáceres) and international (Brazil, Dominican Republic, Mexico, or Colombia) expansion, which has generated multi-million euro losses. This situation necessitates a rapid reevaluation of the early-century expansion plan. A report from the Chamber of Accounts, consulted by EL PAÍS, urges the largest public company in the Community of Madrid, alongside Metro, to “as far as possible, accelerate the divestment of entities located in Latin America, particularly those that generate expenses” and to “ensure that the concessions in Lanzarote and Cáceres achieve financial balance.” This failure, which the government attempts to mitigate with promises of sales revenue and favorable arbitration awards, further entrenches the Lezo case in its conflict with Colombia.
