Peru’s biggest timber scandal six years on. . . some justice at last?
More than 90 people indicted for notorious case involving exports from the Amazon to the US and Mexico
Picture this scene: very early one morning a huge ship as far up the main trunk of the River Amazon as it can go is about to weigh anchor with its cargo of tropical timber for the Dominican Republic, Mexico and Houston in the US when suddenly a speedboat turns up and several people including a public prosecutor scramble up the ladder to board. Another speedboat arrives shortly afterwards, this one carrying people from one of the exporting companies. A meeting is held during which the prosecutor claims that roughly 15% of the timber is illegal and, invoking a new law decreed two months previously, says the entire cargo must be unloaded. Tempers fly. Eventually, after an almost farcical series of events unfolding over the next few days - how much will it cost to unload the timber? Who pays? - the prosecutor takes the somewhat bizarre decision to permit the ship to leave on the condition it doesn’t offload the illegal timber in whichever country it is destined for and that instead the ship returns, in however many months time, so that that timber can be impounded.
However, the ship never returns, never even makes it to the US. Two months later, after a series of complications at a port near the mouth of the Amazon in Brazil and in the Dominican Republic, after switching its flag from the Marshall Islands to Panama, after changing its captain, and after being put up for sale and its owner announcing that it is going into liquidation, the ship finally limps into a port on Mexico’s east coast and is seized immediately. The crew is abandoned without pay, and within three months the government says it is now the property of the Mexican state and will be converted into a “training ship.” Later that year, in circumstances that will never come to public light, the timber is released - apparently illegally - and enters the Mexican market.
Meanwhile, as the ship is out there on the water, plying down the mighty Amazon towards the Atlantic Ocean and then across the Caribbean Sea to the Gulf of Mexico, forest inspectors wearing bright orange helmets venture out into the comparatively remote Amazon in order to determine how much more of the timber on board might be illegal. What they discover is that whole villages and literally 1,000s of trees have been faked as part of a sophisticated laundering strategy to make illegally-sourced timber appear legal by exploiting a complex documentation system. Their final conclusion? That more than 96% of the timber on board is “not of legal origin.”
At the same time as all this is going on, the forest inspectors agency becomes something of a target for protesters in two Amazon towns and their offices are attacked, with one firebombed in the middle of the night. In one of the towns, a coffin with the forest inspectors’ director’s name on it is carried through the streets, and a congressman and loggers meet the Prime Minister to demand he is sacked. After receiving a visit from the US ambassador saying he supports the inspectors’ work, the following day the director is effectively fired and then forced to flee the country in fear of his life.
Elsewhere, in the capital city on the Pacific Ocean coast, a Cabinet delegation lobbies the Attorney-General in the hope that the prosecutor will back away from the case, and then one of them, the Trade and Tourism Minister, writes to Mexico’s Secretary of Economy claiming that the timber is legal because it all has the required documents. The governor of the Amazon region from where the ship departed makes that same argument to the prosecutor, the forest inspectors and others, and in an apparently public display of solidarity, together with the Agriculture Minister, he is photographed visiting one of the exporter’s sawmills.
The exporters defend themselves with that argument too - that their timber has the correct documents. One writes to the prosecutor: “it is important to highlight that my merchandise had and has all the required documentation. . . proving its legal origin.” To the Attorney-General, that same exporter writes - in capitals: “THE PURCHASE OF THE TIMBER WAS ALL LEGAL AND SUPPORTED BY DOCUMENTS. . .”
If some or all of this sounds more like a film plot than real life, the sad fact is that it actually happened, in Peru, in late 2015 and 2016. The ship, the German-built Yacu Kallpa, had been moored just outside of Iquitos, the northern Peruvian Amazon’s biggest town, and until its ignominious, somewhat humiliating last voyage it had been plying that Houston-via-Mexico route for years - the only ship to do so. What happened over those extraordinary weeks and months evolved, by some clear margin, into Peru’s biggest ever timber scandal.
While working as a consultant for the NGO Global Witness at the time, I spoke to many of the people involved, including several on board the Yacu Kallpa that dramatic morning. Among them was the prosecutor himself, Pablo Ormeño, from the prosecutors’ office in Iquitos specialising in environmental issues, known by the Spanish acronym FEMA. The timber he had wanted to impound was “dotted all over the place mixed in with the other timber”, he told me, so the only way to unload it would have been to unload it all, and while the new law technically allowed him to impound the whole ship too he didn’t consider that “proportional” because “only a small amount of the overall cargo” was deemed to be illegal. Of course, what he didn’t know at that point was that not far off 97% would turn out to be.
The following year, Global Witness released undercover video footage, a short film and a report showing how some of the exporters on the Yacu Kallpa that last voyage - Inversiones WCA, Corporación Industrial Forestal and Sico Maderas - were aware that just because their timber came with the right documents was actually no guarantee that the timber was legal. That was because the documents are so often falsified. This exploded their so-called “buyers in good faith” defence and exposed what anyone familiar with Peru’s timber sector already knew, but none of the protagonists had ever been caught on camera admitting it so candidly and in such detail. Here is Sico’s Dante Zevallos explaining to Global Witness undercover operatives how things worked:
DZ: So even though I knew the timber I was buying probably had this [illegal] origin, I wasn’t worried, because I had [motions documents]. . . I was a buyer in good faith.
GW: And that happened with this [Yacu Kallpa November 2015] shipment?
DZ: Yes. All of it.
GW: So you knew they were probably taking [timber] from, say, riverbanks or wherever?
DZ: When one buys timber, one assumes that timber is coming from the area, but one also knows there are many things happening behind that. But when you have the documents. . .
GW: In other words, you know it might not be coming [from where it claims to come from]?
DZ: That’s right. I know it might not be coming [from where it claims to come from]. At that time one risked that. Why? Because under the law when I had a document validated by the state, for me it’s legal. . .
Why draw attention to any of this now? Because in addition to the fact that deforestation is one of the biggest contributors to climate change, or that the Peruvian Amazon is the fourth largest tropical rainforest worldwide, or that more of it was cut down in 2020 than any other year on record, or that this year’s UN climate change conference begins imminently, prosecutors have finally got around to indicting many of those involved with the Yacu Kallpa scandal. According to Peruvian media site Ojo Público, this concerns over 90 people including 41 state officials and 14 from the exporters - the latter a particularly encouraging development since at one point none of the exporters were among those being investigated by FEMA.
Some justice at last, perhaps, after six years and four different prosecutors in Iquitos in charge. Alberto Caraza, the prosecutor now overseeing things, tells me that the first audiences are scheduled to be held next month.
“Before we arrived there had been various prosecutors who made little progress on this case [but] the team that we’ve formed now has taken it on very responsibly,” he says. “It’s an enormous, gratifying responsibility to be an environmental prosecutor and to fight environmental crimes head-on. It’s important because we’re contributing to the wellbeing of the whole world.”