Argentinian Millionaire Accused of Tax Evasion Hopes to Keep Casino

Posted on: June 14, 2022, 07:41h. 

Last updated on: August 4, 2022, 08:05h.

An Argentine businessman who spent time in jail for tax evasion wants to keep his casino. Cristobal López is banking on his influence and connections that run to the top of the government to keep control of Central Casino of Mendoza.

Cristobal López and Ingrid Grudke
Cristobal López and Ingrid Grudke, a model who once had a relationship with the Argentine businessman. López is confident he can hold onto his Mendoza casino, despite allegations of tax evasion. (Image: Infobae)

López is the favorite to keep the million-dollar contract, despite spending time in prison and allegedly not paying taxes this year. He is trying to hang on to the casino through companies linked to him.

The national government gave López a nod by allowing his bankrupt companies to enter moratoriums. This removed a portion of the criminal cases that he dragged. His modus operandi was reportedly the same in each circumstance. He would withhold contributions, leverage other businesses, and then receive help from the government.

López promises an investment of more than ARS2 billion (US$65.32 million). But some doubt the promise based on his track record.

Other companies are eyeing the property. However, the Mendoza State Prosecutor’s Office will make the final decision, even if it made up its mind before accepting proposals.

Gaming the System

For the tender, four companies presented proposals. These included a joint venture between the owners of the Hyatt (new Plaza Hotel) and Mendoza Central Entretenimientos (Alfredo Vila); Fuentemayor, Desarrollos Maipú and Traylon, the company linked to López.

The key to the tender is the fee requested by each company. López’s company presented the lowest fee in the new tender, although still above the current one.

Traylon wants 52% of the income in exchange for his investment and the right to install 720 machines. The current dealers (with Hyatt as partners) asked for almost 72%, Fuente Mayor 54%, and Desarrollos Maipú 62%.

López had, in Mendoza, part of his gambling empire. First, with the concession of the official casino of San Rafael. It then expanded to other areas, such as Rivadavia and San Martín. He was even a partner in the first concession of the central casino through Casino Club.

López asked for a contract extension, but lost. However, he did not resign and competed to hang on to a gaming room in the East. He’s now betting on the central casino, the main gaming hall of Mendoza. The business could exceed ARS1 billion (US$8.16 million) in revenue annually.

History of Wrongdoing

López has a history of non-compliance with the province, according to local media outlet MDZ Online. In fact, in the Supreme Court of Mendoza, there are still pending cases for irregularities in some of his other companies. Through Oil, for example, López obtained oil concessions in the province but never fulfilled the investment promises.

In the Rio Diamante area, it never contributed the $66 million it had committed as an investment to keep the concession. In the Rio Atuel area, it also did not comply with the payment of the supply maintenance guarantee.

López and his partner, Fabián De Sousa, spent time in jail for having withheld more than ARS8 billion (US$65.3 million) from a fuel transfer tax. Later, a court convicted Ricardo Echegaray for that cause, but not López and his partner, De Sousa. That sentence is under appeal, so they are not completely in the clear.

But López, who reportedly runs in the same circles that included former president Néstor Kirchner before his death, was convicted in another case for failing to pay his obligations. This year, the judge of Fiscal Executions, Carlos Faggi, sentenced him to pay more than ARS154 million (US$1.25 million), plus interest, for unpaid taxes. In particular, that of personal property. The amount of his debt to Argentina is reportedly higher.

The decision on the Mendoza casino can come at any time.