1. Conversion and transfer of assets (Article 77 of the Law on Narcotics and Psychotropic Substances35) 46. On September 30, 1996, the Superior Court of Justice of Quito ordered the initiation of proceedings in the case being brought against, among others, the alleged victim for the crime of conversion and transfer of assets, set forth in Article 77 of the Law on Narcotics and Psychotropic Substances. The Chief Judge determined that evidence of the material existence of the offense had been demonstrated in accordance with the law by means of the details of the property found in the residences of different individuals, specified in the report entitled Operación Ciclón. With respect to Mr. Montesinos, it was noted that in the statement he gave to prosecutors in Pichincha, he acknowledged having weapons in his house at the behest of Jorge Reyes. In addition, the pretrial detention of the defendants was upheld and an order was given to seize all of the property that had been used to commit the crime being prosecuted.36 47. On April 29, 1998 the Superior Court of Justice of Quito dismissed the case on the grounds that the existence of an offense had not been adequately proven.37 2. Illicit enrichment (Article 76 of the Law on Narcotics and Psychotropic Substances38) 48. On November 22, 1996 the Chief Judge of the Superior Court of Quito ordered a trial in the case brought against the alleged victim for the crime of illicit enrichment, set forth in Article 76 of the Law on Narcotics and Psychotropic Substances. The Chief Judge determined that “evidence of the material existence of the offense” had been demonstrated in accordance with the law and indicated that the Pichincha Prosecutor had alleged that: [A]t its core, illicit enrichment encompasses all property and personal rights and the legal provision that governs this crime places the burden of proof on the defendants, who are required to demonstrate the legality of the means used to make the expenditures or increase their net worth or that they derive from sources not directly linked to the crimes established under the Law on Narcotics and Psychotropic Substances.39 49. The Chief Judge decided to uphold the pretrial detention provided for in the order to initiate proceedings and ordered the seizure of all the goods, currency, and other valuables that had been used in the commission of the crime being prosecuted or that resulted or derived therefrom.40 50. On May 7, 1998 the Superior Court of Justice of Quito dismissed the case on the grounds that the existence of an offense had not been adequately proven.41 35 Article 77. Conversion or transfer of assets. Anyone who intentionally conceals the origin, contributes to the purchase or sale of assets, or converts or transfers them with the knowledge that these assets were obtained through the commission of offenses classified in this Law, shall be punished by imprisonment for up to four to eight years and fined 20 to 4,000 times the prevailing minimum wage. If this offense is committed via the creation of a group conspiring to prepare, facilitate, or ensure outcomes or impunity, the punishment shall be 8 to 12 years in prison and a fine of 40 to 6,000 times the prevailing minimum wage. 36 Opening of the trial. Criminal Trial for Conversion and Transfer of Assets No. 94-92. Order dated September 30, 1996; issued by the Chief Judge of the Superior Court of Justice, Dr. Fausto Argudo. 37 April 29, 1998 ruling by the Superior Court of Justice of Quito – Fourth Chamber of Associate Judges in the trial of Mario Montesinos for conversion or transfer of assets. 38 Article 76. Illicit enrichment. Anyone who is presumed to be the producer or an illegal trafficker of narcotic drugs, psychotropic substances, or specific chemical precursors, or who is involved in other crimes covered by this law, and who directly, or through an intermediary, engages in spending or increases his net worth or that of a third party by an amount not in proportion to his income without substantiating that the increase occurred by legal means faces a prison term of 12 to 16 years. 39 Opening of the trial. Criminal Trial for Illicit Enrichment No. 94-92. Order dated November 22, 1996 at the beginning, and November 25, 1996 at the end; issued by the Chief Judge of the Superior Court of Justice, Dr. Nelson Almeida García. 40 Opening of the trial. Criminal Trial for Illicit Enrichment No. 94-92. Order dated November 22, 1996 at the beginning, and November 25, 1996 at the end; issued by the Chief Judge of the Superior Court of Justice, Dr. Nelson Almeida García. 41 April 29, 1998 ruling by the Superior Court of Justice of Quito – Fourth Chamber of Associate Judges in the trial of Mario Montesinos for conversion or transfer of assets. 8