The Chilean Prosecutor’s Office has formalized a case against the former owner and previous executives of salmon-farming firm Australis, alleging they knowingly inflated the value of the company artificially when they sold it in 2018 to Chinese firm Joyvio.
The prosecutor’s office specifically accused former Australis owner Isidoro Quiroga and former executives Martín Guiloff and Santiago Garretón of fraud and unfair administration.
Prosecutor Constanza Encina presented the case denouncing the maneuvers carried out by the firm’s previous administration, saying it conducted a “plan of sustained overproduction over time with respect to most of the production centers of Australis” that culminated in what prosecutors labeled a fraudulent sale.
Under the alleged scheme of producing salmon significantly beyond that allowed by its environmental permits, Australis reached a total production of 329,670 metric tons (MT) between 2018 and 2022, far exceeding the maximum allowable limit of 231,382 MT and artificially inflating the value of Australis Seafoods, according to the prosecutor’s document.
The document goes on to explain that the defendants maliciously implemented deliberate steps to conceal the irregularities from Joyvio during the due diligence process of the sale, falsely confirming that Australis complied with environmental regulations and possessed all the required permits.
“Unreal and artificially [inflated] asset value was achieved by a productive situation sustained by repeated noncompliance with the maximum production levels authorized by environmental legislation,” the prosecutor said. “It did not include the real structure of costs and legal contingencies that the company hid that it would necessarily have to face once the situation was discovered by the environmental inspection entity.”
“Consequently, the detrimental disposition of assets caused to Joyvio amounts to at least USD 620 million [EUR 602 million],” the prosecutor's office said, leaving the real value of the company, adjusted for permitted production capacities, at only USD 299 million (EUR 290 million) – well under the final sale price Joyvio paid in 2018 of USD 921 million (EUR 894 million).
Lawyers for Joyvio expressed satisfaction with the formalization of the case against Quiroga and the former executives.
“With this, it has been confirmed that our client and the market were deceived with a series of lies, fraudulent maneuvers, and false information – a direct consequence being that Australis was provided an unrealistic, inflated value, and an overcharge of more than USD 620 million was paid,” Alberto Eguiguren, an attorney for Joyvio, said. “With this, Isidoro Quiroga’s narrative that this is an extortion strategy dies definitively because it is false and frankly absurd, and it has been demonstrated once and for all to the market in general and to foreign investors that in Chile, the institutions work and that this type of crime will not be tolerated.”
“We want Mr. Quiroga and all the participants in this crime to be convicted by the Chilean justice system and face prison sentences,” fellow lawyer Gabriel Zaliasnik added.
Quiroga's defense team pushed back against the allegations.
“We continue to consider that the cause is unfounded. Here, a crime of fraud is charged where, supposedly, the deception would have consisted of the concealment of productive information of the company. Not only does this contradict common sense, but it simply didn't happen,” Alex van Weezel, a partner at law firm Claro & Cia, which is defending Quiroga, said. “It is argued that this [alleged scam] consisted of the concealment of the company’s productive information. However, not only was this information not hidden, but it is impossible to hide. Data on how much, how, and when it occurred is publicly accessible and began to be delivered consistently from April 2018 until the signing of the contract.”
At the end of the hearing, the prosecutor's office announced that it must determine whether it will expand the investigation for possible environmental crimes and violations of the nation’s securities law. Magistrate Cecilia Villanueva allowed for an additional 180 days for investigation.
In the meantime, the court ordered Quiroga and Garreton to register in person with authorities every three months and were forbidden to leave Chile. Guiloff, who lives in Spain, was ordered to sign in at the Chilean consulate every other month.
The formalization follows a November 2024 review of the emails of 11 of Australis’s former directors and executives, including Quiroga.
