Wednesday, July 24, 2024

Samuel García says he has ‘nothing to hide’ regarding payments to his law firm

Nuevo León Governor Samuel García Sepúlveda denied any wrongdoing and declared that his government is “incorruptible” after a Monterrey-based newspaper reported that a law firm owned by the politician and his father received payments of over 200 million pesos from a company affiliated with a favored government supplier.

“I’m very relaxed because I don’t have anything to hide and because I have proof and arguments to refute every false accusation,” García, a representative of the Citizens Movement (MC) party and one of Mexico’s best known political leaders, said in a statement on Wednesday.

“… I hope that next time [the] El Norte [newspaper] asks me for information before drawing up a front page in bad faith, based on false and manipulated information.”

What does the El Norte report say?   

El Norte, a sister paper of the Mexico City-based broadsheet Reforma, reported Wednesday that it had obtained a copy of a document from the federal tax administration SAT that showed that a law firm established in 2014 by García and his father Samuel García Mascorro received 202.9 million pesos (US $12.1 million) from a “sister company” of “one of the most favored suppliers” of the current Nuevo León government.

The report, which was also published by Reforma, said that the SAT document shows that between October 2021 — the month García took office — and November 2023 the company Suministro MYR billed the Nuevo León government 964.7 million pesos (US $57.8 million) for its provision of meals to prisons, police training facilities, cafeterias of government department and government events.

El Norte reported that MYR paid its “sister company” Proveedor de Productos Mexicanos Jace — with which it has partners in common — 237.2 million pesos in the same period for “supposed corporate administration services.”

Samuel García press conference screen capture
The governor was questioned about the payments during a press conference on Wednesday. (Screen capture)

Jace, meanwhile, paid 202.9 million pesos in professional service fees to García’s law firm, Firma Jurídica y Fiscal Abogados, according to the report. El Norte noted that the exact natures of the services wasn’t specified. The newspaper called the payments by Jace to the governor’s law firm a “triangulation” of resources.

El Norte said that the SAT document indicates that Jace’s payments to the law firm began on Oct. 15, 2021 — 11 days after García was sworn in as governor of Nuevo León. The company made a total of 29 payments to the law firm in 2021, 2022 and 2023, according to the newspaper.

El Norte said that MYR also provided food services to the Nuevo León government when Jaime Rodríguez, García’s predecessor, was governor. The company has been involved in a range of other businesses and didn’t make the provision of meals its main activity until 2022, El Norte said.

The only government supplier that has received more money from García’s administration is Mota-Engil México, which is building new metro lines in Monterrey, the newspaper said.

Construction on a new metro line in Monterrey
The contractor building new metro lines in Monterrey has been the biggest recipient of payments from the state government during García’s term. (Samuel García/X)

Based on information to which it had access, El Norte said that Jace became a client of the governor’s law firm in 2021. “There are no previous records of operations or transactions between the company and the [law] firm,” it reported.

García’s response in detail 

The governor and erstwhile 2024 presidential hopeful rejected the basis of El Norte’s report at a press conference on Wednesday morning. He subsequently released a statement based on his remarks.

“My government is incorruptible and I am as well,” the statement began.

In the first of three numbered points, García said that MYR has been a Nuevo León government supplier since January 2016 when the government led by Rodríguez was in office.

Contradicting El Norte’s claim, he said that Jace has been a client of his law firm since October 2017, four years before he became governor. “I wasn’t even a senator at that time,” García added.

At his press conference, the governor said that his law firm signed an agreement with Jace to provide it with legal services associated with an audit. That audit, El Norte reported, resulted in the company receiving a 196-million-peso tax credit.

Jaime "El Bronco" Rodríguez
One of the companies in question has been supplying the government since the administration of García’s predecessor, Jaime “El Bronco” Rodríguez. (Cuartoscuro)

García said that the payments the law firm received from Jace were for services rendered starting in 2017, but didn’t explain why the company only settled its bill after he took office as governor in October 2021.

El Norte and Reforma reiterated on Thursday that “available information from SAT indicates that between 2017 and September 2021 there was no invoicing between Jace and Firma Jurídica y Fiscal Abogados.”

García said in his statement that the tax credit granted to Jace was “nullified” by a court in September 2022 and that another court upheld that ruling in January 2024.

“The origin of this article is a montage,” he said, asserting that it was based on information leaked by the Nuevo León Attorney General’s Office [FNL], which he derided as being “managed by the old politics,” i.e. parties that previously held power in the northern state, namely the Institutional Revolutionary Party (PRI) and the National Action Party (PAN).

Since January, the FNL “has been investigating my family’s companies as a means to pressure, extort and defame us during this electoral process,” said the governor.

García’s term as governor doesn’t end until 2027, but his wife Mariana Rodríguez will represent MC at the June 2 mayoral election in Monterrey, and voters will elect new Nuevo León lawmakers on the same date.

Mariana Rodríguez poster in Monterrey
García’s wife Mariana Rodríguez is running for mayor of Monterrey. (Cuartoscuro)

The governor predicted that “more attacks like this” will occur “for a simple reason: … [we’re in] electoral times and that’s the way the old politics operates.”

Another reason for future attacks, he said, will be that “the government has thousands of suppliers and the [law] firm that my father founded has a lot of clients because for years it has been one of the best in Nuevo León.”

In addition to saying he had “nothing to hide” and “proof and arguments to refute every false accusation,” García asserted that he “built” his personal wealth “working hard and a lot before entering politics.”

The El Financiero newspaper reported that García declared annual income of 4.23 million pesos (US $253,750) in 2022, of which 1.13 million pesos came from his salary as governor. The newspaper said that he is a partner of at least 11 companies, including the law firm he established with his father.

Xóchitl Gálvez, presidential candidate for an opposition alliance made up of the PRI, the PAN and the Democratic Revolution Party, was one of several politicians who called for García to be investigated in light of the information disclosed by El Norte.

With reports from El Norte, Reforma and El Financiero

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