Is Breakthrough Near in Jacob Ostreicher Case?

Advocates See Hope for Jailed Brooklyn Businessman

By Nathan Guttman

Published December 13, 2012, issue of December 14, 2012.
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Long months of standstill in the case of Jacob Ostreicher, a New York Jewish businessman locked up in Bolivia for 20 months, have given way in recent weeks to a flurry of activity that has spurred hope for Ostreicher’s possible release.

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In a dramatic sequence of events, top Bolivian government officials involved in the prosecution have been arrested and charged with attempting to extort Ostreicher and with unlawfully trying to take over his business.

As events unfold in Santa Cruz, Bolivia, advocates for Ostreicher are cautiously hopeful that the new twist in the plot will lead authorities to set him free. Still, Miriam Ungar, Ostreicher’s wife, told NBC News on November 28 that she was not getting her hopes up, given the corrupt legal system her husband is facing.

Still, a Bolivian court declined to order Ostreicher’s release after a hearing on Tuesday.”

The latest hearing, in which Ostreicher’s case was referred back to the lower court for re-consideration, could indicate a new willingness to question the evidence and circumstances that led to his arrest.

Ostreicher, 53, of Brooklyn, was arrested by local police in June 2011 after being accused of money laundering by the Santa Cruz district attorney. The claims centered on a rice-growing farm in central Bolivia in which Ostreicher had invested. Though only a junior investor in the $25 million project, Ostreicher went to Bolivia to represent the owners, who suspected that the location manager of the farm had been stealing from the company.

He was arrested shortly after his arrival in Bolivia and sent to the notorious Palmasola prison, a prisoner-run facility where inmates are allowed to roam freely but often face violence from their fellow inmates. In November, Ostreicher was transferred to a medical facility where he was diagnosed with Parkinson’s disease. He has remained there since.

Ostreicher has yet to be charged, and prosecutors argued in several court hearings over the summer that they are waiting for reports from Switzerland in order to verify the source of the money used for the investment in the rice farm.

But on November 27, Bolivian authorities announced the arrests of seven of the officials who were involved in the Ostreicher case, including the judge who ordered Ostreicher sent to jail. Another suspect is a high-level government official accused of confiscating 18,000 metric tons of rice from the farm after Ostreicher’s arrest. In announcing the arrests, Bolivia’s interior minister, Carlos Romero, said that the suspects were part of “a network of corruption and extortion” that involved “government officials, private individuals[,] and possibly had connections with the judiciary.”

Government investigators interviewed Ostreicher shortly after the arrests, and according to an Associated Press report, Ostreicher pointed to one of the suspects as a person who had demanded $50,000 in return for his release.

Upon hearing of the arrests, Democratic Rep. Jerrold Nadler of New York wrote to the Bolivian government and demanded the release of his constituent Ostreicher in light of the new developments. “I call for his immediate release on bail, and a serious examination into the merits of this case,” Nadler said in a statement. Congressional staffers said Nadler did not receive any response from the Bolivian government.

In addition to the corruption-related arrests, family members and supporters of Ostreicher found hope in the fact that Bolivian laws prohibit the government from keeping suspects in custody more than 18 months without pressing charges. Ostreicher reached the 18-month mark of his stay October 4.

Still, despite the extortion claims leveled against those in charge of Ostreicher’s arrest, and the passing of the legal deadline, authorities in Bolivia have yet to indicate whether they are considering Ostreicher’s release.

Contact Nathan Guttman at guttman@forward.com


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