Panamanian prosecutors obtain an additional year to investigate union leaders for alleged money laundering

The Public Prosecutor's Office obtained a one-year extension to continue the investigations related to the Red Frog Beach case. (Illustrative image Infobae)The Public Prosecutor's Office of Panama obtained an additional year to investigate leaders of the construction union for the alleged appropriation of 14 properties linked to the Red Frog Beach tourism project, located in Bocas del Toro. Among the leaders under investigation are Genaro López, Saúl Méndez, and Erasmo Cerrud, linked to a criminal case that includes alleged crimes against economic assets, money laundering, document forgery, and criminal association. The extension was granted by a guarantees judge, after the Second Specialized Superior Prosecutor's Office Against Organized Crime managed to reverse a judicial decision that limited the investigations. The process involves members of the National Union of Workers of the Construction and Similar Industries (Suntracs), one of the most influential union organizations in Panama, with a presence in major infrastructure projects. Genaro López, former secretary general of Suntracs, is among the union leaders investigated in this case. Video captureThe organization represents construction sector workers, participates in collective bargaining negotiations, and has led national mobilizations related to labor demands, government policies, and reforms to the social security system. The criminal investigation began in 2022, following a complaint filed by workers who questioned the fate of 14 parcels handed over as compensation for a labor dispute at the tourist complex located on Bastimentos Island, Bocas del Toro. The origin of the dispute dates back to a strike carried out between February 2007 and October 2008, in which 412 construction workers participated and which was declared legal by the Ministry of Labor. The company Pillar Construction, later renamed Bastimentos Holding, was ordered to pay USD 7 million in back wages, but reached an out-of-court settlement with the workers, represented by Suntracs, to compensate them with properties. Suntracs was founded in 1972 and is one of the most influential union organizations in Panama. EFE/Bienvenido Velasco The parcels delivered totaled 33,712 square meters and were then valued at USD 3 million. The investigation seeks to determine whether the union leaders disposed of these assets without authorization from the beneficiaries. According to the Prosecutor's Office's hypothesis, the properties were used as collateral for a mortgage loan managed through the Suntracs Multiple Services Cooperative, which would have received funds from the union itself to finance the credit operation. In August 2025, a judge ordered the seizure of the 14 parcels, a measure later confirmed by the Superior Court of Appeals, while the authorities deepened their inquiries into the real estate and financial transactions. Among the pending procedures identified in June 2026 were obtaining banking information on 663 checks, the analysis of 50 electronic devices, and the review of documents related to the economic operations under investigation. The Prosecutor's Office also stated the need to interview some 400 workers linked to the project, in addition to completing the forensic analysis of a server sent to the Institute of Legal Medicine and Forensic Sciences. The Prosecutor's Office is investigating a USD 3.1 million mortgage loan related to the properties handed over to the workers. (Illustrative image Infobae)Genaro López, the union's former secretary general, has remained under precautionary measures other than imprisonment, while Saúl Méndez, another historic leader of the organization, remains a fugitive from justice, according to judicial reports. In López's case, the Prosecutor's Office filed an accusation in which it requested the maximum penalties for the crimes charged, which could add up to 30 years in prison if his criminal responsibility is established at trial. The defense argues that the dispute falls under labor jurisdiction and questions the duration of the investigations, while representatives of the union have denounced an alleged persecution against the union organization. The Superior Court of the First Judicial District determined that the request for extension had to be examined in accordance with Article 504 of the Criminal Procedure Code, applicable to investigations declared complex, which allows granting an additional 12 months. The judicial decision will allow the proceedings aimed at establishing the possible criminal responsibilities of those under investigation to continue, without the extension of the deadline implying a declaration of guilt or anticipating the final outcome of the process.