The ruling on Friday opens Pinochet to investigation and prosecution for embezzling millions of dollars in public funds said to have been deposited in secret bank accounts outside of Chile.
Judge Carlos Cerda said that he had found evidence that the 90-year-old used $2million in government funds to benefit himself and his family, including his older son, also named Augusto, who was living in the United States in the 1980s.
Pinochet was stripped of impunity in October last year, to face other charges in the tax fraud case, including tax evasion, falsification of documents and false declarations of properties.
The former dictator has avoided being processed in a handful of human rights cases in the past because of his health problems, which include mild dementia caused by frequent mini-strokes.
Under Chilean law, the courts must decide on a charge-by-charge basis whether to strip Pinochet of his impunity – a privilege granted to former presidents.
Banks under scrutiny
The secret Pinochet accounts have had repercussions for international banks.
Riggs Bank, based in Washington, pleaded guilty to a criminal violation of the US bank secrecy act, an anti-money-laundering law, and agreed to pay $16million for failing to report suspicious activity in Pinochet’s accounts. Riggs was subsequently acquired by another bank.
New York and Miami branches of Banco de Chile, Chile’s No. 2 bank, were fined $3million for inadequate anti-money-laundering programmes.
An official at the court’s press office told the Associated Press that the ruling will be issued on Monday after all the justices have signed it.