Victims and survivors of violent land grabs file lawsuit against the IFC.
I’ll never forget the day over 20 years ago that a refugee from Myanmar (Burma) explained law to me better than any of my professors or the experts ever did. The young woman, a survivor of rape and other unspeakable human rights abuses, was talking about an American oil company’s decision to contract with and finance the notorious Burmese military to secure its investment there. Her statement was simple: “When you shake hands with someone whose hands are covered with blood, then your hands are going to get blood on them too.”
Today, when EarthRights International (ERI) and residents of the Bajo Aguán region of Honduras filed a lawsuit against the World Bank Group’s International Finance Corporation (IFC), those words rang loud and clear in my ears. In their case, our brave clients who are being terrorized by the recipient of the IFC’s loan, the Dinant Corporation, basically said this: “When you pass money to a company that has blood on its hands in one of the most violent places on earth, then your hands will have blood on them too.”
It is no secret that Honduras is an exceedingly dangerous place, especially for earth rights defenders resisting dams, logging, and agricultural projects on their lands. Especially right now, we remember the murder of Berta Cáceres, who was protecting her community from a dam project, just over a year ago. Berta’s struggle, which continues today, is the same as that of the farmers in the Bajo Aguán: The communities face murder, beatings, threats and intimidation simply because they live on rich lands coveted by powerful interests. The fact that the IFC finances such abuses is the first injustice; the second is that the IFC claims absolute immunity from any legal responsibility, no matter how bloodstained its hands are.
In other words, they believe they can get away with it.
The Bajo Aguán region of Honduras is home to large-scale palm oil production, but it wasn’t always. Before a series of World Bank–sponsored land “reforms” in the 1990s, the land was farmed and owned by small cooperatives. Farmers had come to the Aguán at the invitation of the Honduran government – they cleared forests, prepared the land for cultivation and were given collective title in exchange for that work.
But things changed when the World Bank thought there was more money to be made from those lands. The Bank encouraged the Honduran government to weaken and permit the sale of collectively-owned land, enabling privatization of that land. In the years that followed, land-grabbing and terror have swept across the Aguán.
At the center of this tragedy was (and is) the Dinant Corporation, which was owned by Miguel Facusse, until his death in 2015. During the land “reform” period, he and his companies took land from the farming cooperatives and built a palm oil empire. Members of the farming collectives were tricked and defrauded. And those that refused Facusse’s “offers” were met with intimidation and violence – many that resisted wound up dead.
The IFC – the commercial lending arm of the World Bank Group – thought he would make a good business partner. We could spend a lot of time wondering how an institution whose stated mandate is to help the poor would think this, and continue to finance deadly land grabs over all these years. But that’s where the IFC’s claim of absolute legal immunity comes in – someone who thinks that they can do whatever they want without consequence is someone who thinks they can get away with murder. Last month, I sat in a U.S. federal court and listened to the IFC’s lawyers making essentially this claim in a case brought by Indian fisherman whose lives were upended by a similarly ill-conceived loan. Their crux of their legal position was this: The IFC has absolute immunity – the IFC is above the law.
And so, in 2009, the IFC made a $30 million loan to Dinant to support and expand its palm operations in the Bajo Aguán. And, in the years that followed, Dinant – with a cadre of private security and paramilitary forces, and the aide of the Honduran military – waged a war against the residents of the Aguán. Since the IFC’s 2009 capital injection, Dinant has been implicated in the deaths of at least 40 people. Most of these victims were killed because of their peaceful campaign to regain the collective lands that were illegally taken from them.
One of the most horrifying parts of this tragedy is that the IFC chose, time and time again, to funnel money to Dinant even as violence in the Aguán spiraled out of control in 2010. This was not a one time loan. This was a sustained financial relationship.
In 2011, the IFC – along with IFC-AMC, its shadowy subsidiary – made a $70 million investment in Banco Ficohsa, the large Honduran bank that also happened to be Dinant’s largest creditor. Now, I know you might be thinking “Lending to Ficohsa isn’t the same as lending to Dinant?” Well, in this case, it was.
When it made the investment, IFC knew that Ficohsa was heavily invested in Dinant and that Dinant was implicated in gross human rights abuses, but it waived its own loan requirements that would have forced Ficohsa to reduce its lending to Dinant anyway. IFC’s own auditor found that its decision to invest and waive its loan policies “facilitated a significant ongoing flow of capital to Dinant . . . at a time when IFC management was aware of serious unmitigated environmental and social risks regarding” Dinant.
That year, Dinant was implicated in at least 15 killings in the Aguán.
Then, in 2013, the IFC decided to support Dinant once again, by guaranteeing $5 million worth of loans that Ficohsa made to Dinant.
Between 2012 and 2013, Dinant was implicated in at least 14 more killings.
The IFC has a lot to answer for and it owes those answers to the people of the Aguán who live under Dinant’s knife to this very day. How can the IFC – who purports to seek an to end poverty – fund a company that is, as one of our clients said, “ending the lives of the poor?”
And it owes the people of the Aguán more than answers, it owes them justice. The IFC clearly cannot police itself and it can’t hide behind a veil of immunity. The courts of the United States must be open to hear this case because nobody – not individuals, not corporations, not governments, and not the IFC – can get away with aiding these human rights abuses.
Many years after my conversation with that young refugee woman, the U.S. justice system vindicated her belief, and that American company was held accountable for the human rights abuses it aided and abetted in Myanmar. There’s a first time for everything, and our Honduran clients believe that this case demands justice and nothing less.