Monday, August 24, 2015

Guatemalan President Otto Pérez Molina accused in corruption scandal (August 24, 2015)





On Friday the International Commission Against Immunity in Guatemala (CICIG) and the Guatemalan Public Ministry filed charges against Perez Molina in the country's Supreme Court saying he led a crime ring known as "La Linea." The charges could lead to the embattled president being impeached, reports VICE.

"We have found the very regrettable participation of the president of the republic and Mrs Roxana Baldetti at every level of the organization" behind the scheme, said Ivan Velasquez of the U.N. backed CICIG.

Velásquez said they had found evidence tying Pérez Molina and Baldetti to La Línea criminal ring, including a real estate sales plan in which the client was the President, and checks in the former veep's name reports Plaza Pública.

Pérez Molina rejects the accusations, and says he will defend himself in court. In a televised message to citizens yesterday he said the investigation is an example of international and special interest meddling in politics and called on rural workers and indigenous groups to demonstrate in his favor, reports El Periódico

La Línea has rocked the Guatemalan political scene since April, when the CICIG announced that it had uncovered a scheme involving high level politicians taking millions of dollars from businessmen who paid bribes in order to evade import duties. Altogether, Guatemalan taxpayers have been defrauded of $120 million, according to the investigation.

More than 30 people have been detained so far, reports the BBC.
On Friday Velasquez and Guatemalan attorney general Thelma Aldana announced that they now have proof that Pérez Molina and Baldetti were involved in the scheme. They present as evidence 89,000 wiretaps, 5,000 e-mails, 17 raids, and dozens of thousands of documents, reports Nómada. The investigation has centered heavily on hard evidence instead of witness information, reports Plaza Pública.

"Everything was arranged, with consent, with superior authorization. All these references to 1 and 2 [in the wiretaps] … each one of these pieces was in order to articulate with President Otto Pérez Molina and former vice president Roxana Baldetti," said Velásquez on Friday. Double-entry accounting on raided computers show each financial movement of the corruption scheme, explained the officials on Friday, saying it was fortunate that the criminals kept neat books.

"From the evidence seized in raids along with wiretaps, it is probable that the president of the republic has participated in committing the same punishable conduct as the other suspects in the scheme, Aldana said on Friday.

Guatemala followers will enjoy the sordid details: Baldetti was charged in a room in a private hospital, where she had checked in complaining of gastro-intestinal distress, though the media reports that information skeptically, saying it was probably a last ditch attempt to avoid jail. (Photo of Baldetti being charged.)

Weekly protests in Guatemala, spurred by La Línea and other corruption scandals including one affecting the national social security institute, have demanded the resignation of Pérez. A vote in Congress last week to strip him of the immunity granted to the office narrowly failed last week.

This weekend thousands of citizens gathered in Guatemala City demanding Pérez’s resignation, but he continues to refuse, reports AFP. His cabinet is hemorrhaging as officials rushing to step aside  -- though El Periodico reports that Pérez Molina isn't accepting resignations. 

Fernando Carrera, Guatemalan ambassador to the U.N. and former Minister of Foreign Relations has a piece in Soy 502 calling on Pérez Molina to resign in order to strengthen the institutional process Guatemala is undergoing. He notes the importance that all of the accusations and defense are taking place in a democratic and constitutional framework.

But resigning might be a moot point, explains Nómada. Should the president be stripped of his immunity, declare in the ensuing trial and be sentenced to pre-trial detention he would automatically lose the office.

Three months ago the Supreme Court already rejected a petition to strip Pérez Molina of immunity, and he cobbled together a narrative of staying in the presidency to maintain Guatemala’s institutional stability, argues Martín Rodríguez Pellecer in another Nómada piece. Pérez managed to stay in power thanks to the support of the Guatemalan business community, the opposition-led Congress (under the leadership of Manuel Baldizón, who has been leading the polls to win the upcoming presidential election) and the U.S. Embassy. 

Now, with a solid accusation against him – and evidence gathered by the CICIG and the Public Ministry – those supports are likely to dissolve. Already on Friday the main business association, Cacif, called for Pérez Molina to resign. 
"Today the President is linked to a contraband structure, which gravely compromises his situation and position as head of the Executive and makes it truly unsustainable," said Jorge Briz, head of the Chamber of Commerce and accompanied by business leaders, reports Nómada. The piece notes that the business community has been largely silent throughout the months of political upheaval since La Línea was revealed.

In a Nómada article from Thursday (before the revelations) Martín Rodríguez Pellecer analyzes the importance of the support of the business community for Pérez Molina’s continued governance – and thus the relevance of their ending that backing on Friday. According to Rodríguez’s analysis the Cacif is one of the major factors that permitted Pérez Molina to continue until now – along with the U.S. Embassy.

Following Baldetti’s resignation earlier this year, Congress approved the appointment of former constitutional court justice Alejandro Maldonado as vice president, who will take Pérez’s if he leaves before the end of his term, reports Bloomberg.

All of this occurs just two weeks before presidential elections are scheduled for September 6. Protesters have increasingly called for the election to be delayed, but Guatemala’s electoral court discarded that option. (See last Monday's post on the upcoming elections.)

Of course, the elections are hardly a way out of the current political mess, notes the New York Times. The front-runner, a businessman named Manuel Baldizón, has been taken to task by the electoral authorities for overspending in his campaign and his vice-presidential candidate, Edgar Barquín, the former head of Guatemala’s Central Bank, is facing prosecution in a separate inquiry involving money laundering.

A journalist on Friday asked Velásquez and Aldana whether the announcement had been timed regarding the elections. They rejected the idea, saying they came out as soon as they had the relevant information.

Those who might optimistically think that at least customs fraud in the country is done with are wrong, explains Mario Archila in Plaza Pública. What the case indicates, he says, is the importance of black market importations, as those are the kind of companies that benefit from this kind of under-estimating the value of importations.

And those interested in the winding roads of corruption in Guatemala should look at a piece in Plaza Pública that explains how La Línea is only the latest iteration of a customs racket system put into place in the 1970s.

News Briefs

  • Venezuelan authorities are using bureaucratic minutia to eliminate opposition candidates for the upcoming December legislative elections, reports the New York Times. Nine opposition leaders have been disqualified in recent weeks, though authorities reject political maneuvering as the reason. Barring opposition candidates could stop some popular leaders from gaining votes, and could create divisions among the broad opposition to the Maduro administration.
  • Eduardo Cunha, Brazil's speaker of the lower house of Congress was accused of taking as much as $40 in bribes in the context of a wide-ranging Petrobras corruption scandal (see Friday's post). Far from admitting guilt, he's saying he's at the center of a conspiracy to deflect attention away from his former ally, embattled President Dilma Rousseff. His lashing out "is raising concern over the potential for even more political upheaval as the government grasps for ways to deal with dismal approval ratings and a sharply contracting economy," reports theNew York Times.
  • A Brazilian federal judge has asked prosecutors to investigate donations to Rousseff's 2014 re-election campaign, citing signs that money from a high-profile corruption scandal ended up financing her campaign, reports the Wall Street Journal. The request further complicates the already struggling president, though any verdict on that matter could take months, or even years to be reached explains the piece.
  • After last year's migrant minor crisis in the U.S., the numbers of unaccompanied children arriving at the border has sharply decreased. But the crisis has simply shifted, reports the New York Times. It's now playing out in courtrooms where thousands of children without lawyers have been issued deportation orders, some because they never showed up in court.
  • El Daily Post reports on Encuentro mortales, a new Spanish-language open-source reporting project aims to become a reliable database that documents the killing of undocumented immigrants during interactions with law enforcement in the United States.  Encuentros mortales is collecting public records and media reports of undocumented immigrants killed during interactions with law enforcement, starting from the year 2000, with a focus on the southern border of the United States. It will also rely on crowdsourced submissions to fill in the gaps, mining Spanish-language news outlets along the border and promoting itself widely within Spanish-speaking communities. The project is similar to Fatal Encounters, a site also created by D. Brian Burghart that records police killings across the United States. Burghart's motivation was the realization that such encounters were woefully underreported and he hoped to present a more accurate picture of police violence through the collection of more rigorous data, explains the piece.
  • The families of Mexico's thousands of missing people say they have little help from the government. About 25,000 people have "disappeared" since 2006, according to estimates by the government and human rights groups. Not clear is how many of them may have been victims of foul play, but some fear that many are dead because of the high levels of violence since federal crackdowns against drug cartels that began that year, reports the Los Angeles Times. Women in particular are vulnerable. (See Thursday's post on femicide in the region.)
  • President Enrique Peña Nieto's wife and finance minister were absolved after a seven-month conflict-of-interest government investigation into the purchase of luxury homes reports theNew York Times. Government influence was not used in the case and the purchase of the homes in question was previous to Peña Nieto's presidency, which means no laws were broken, concluded Mexico's comptroller. But experts said his conclusion, bolstered by a final report that is thousands of pages long, failed to dispel doubts about the independence and scope of the probe said the Wall Street Journal.
  • Chinese market losses and falling commodities prices led to an investor selloff that hit Mexican stocks and the peso today, reports the Wall Street Journal.

  • Venezuelan security forces have deported hundreds of Colombians as part of a security offensive along the border that is ratcheting up tensions between the two neighbors, reports the Associated Press.

Note: Eduardo Romero will be posting the briefing tomorrow (August 25), Thursday (August 27) and Friday (August 28) of this week.

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