Corruption in El Salvador: Flores, Then Saca, Now Funes?

As president of El Salvador from June 2009 to the first of last month, Mauricio Funes made a point of exposing corruption under the two previous Nationalist Republican Alliance (ARENA) administrations. Former President Franciso Flores is currently on the run from charges that he embezzled millions in Taiwanese aid money during his 1999-2004 presidency, and his successor Antonio Saca has been accused of money laundering and is widely seen as corrupt.

But recent reporting by Salvadoran news site El Faro suggests the first president from the leftist Farabundo Marti National Liberation Front (FMLN) has some skeletons hiding in his own closet.

In May, El Faro published an investigation into Funes’ ties to wealthy private security magnate Miguel Melendez, a key donor to the ex-president’s 2009 campaign. Allegedly in return, Melendez received a series of generous government contracts, to the tune of at least $14.6 million during the course of the Funes administration. The news site also pointed to evidence that the president appointed a number of Melendez’s allies to key government posts, starting in late 2011.

What’s more, El Faro reported that Funes’ cozy relationship with Melendez went both ways, noting that the businessman obtained loans to construct properties for a woman rumored to be Funes’ lover, 25 year-old Ada Mitchell Guzman Siguenza, as well as her mother. The latter two also reportedly benefited from their proximity to Funes, obtaining cushy government contractor positions and -- in Ada Mitchell’s case -- a diplomatic passport.  

Despite El Faro’s bombshell, Funes neglected to give any explanation of the apparent favor-trading scheme. Until now.

Yesterday, the news site published an interview with the ex-president, in which he responded to the investigation. They also press him about the more than 80 trips abroad he made during his presidency, many of which were made on Melendez’s own plane or in his company.

The interview is worth reading in full, not only because it sheds further light onto the influence-peddling allegations against Funes, but also because El Faro’s Efren Lemus and Carlos Dada do a spectacular job of contradicting his defenses with documented evidence. One example: when Funes denies ever requesting a diplomatic passport for Guzman Siguenza, his interviewers cite the administrative log of the request, which is listed as coming from the administration directly.

News Briefs

• Rio de Janeiro Mayor Eduardo Paes has found himself linked to corruption allegations, after Epoca and Veja magazines published audio and video suggesting that his former right-hand man, Congressman Rodrigo Bethlem, took part in a kickback scheme. In the footage, which was recorded by his estranged ex-wife, Bethlem admits to having a Swiss bank account and receiving under-the-table payments from an NGO which had received a city contract to operate a drug treatment center for addicts to crack cocaine. The revelation is especially damning in light of the fact that, as Julia Michaels of the Rio Real Blog notes, Bethlem was the primary architect of Rio de Janeiro’s controversial forced treatment initiative. Newspaper  O Globo reports that Paes has opened up an internal audit into the contracts overseen by Bethlem until his departure from the mayor’s office in April of this year. Meanwhile, the state public prosecutors’ office claims to already have evidence of irregularities committed by Bethlem and is currently looking into them, according to Veja.

• After former Venezuelan military intelligence official General Hugo Carvajal was released back to Venezuelan custody on Sunday, a U.S. State Department spokesman issued a statement expressing concern regarding reports that Venezuela “threatened the governments of Aruba, the Netherlands, and others to obtain this result.” In remarks to the Wall Street Journal, Aruban top prosecutor Peter Blanken said Venezuelan authorities had threatened to cut off air links to Aruba and Curaçao, as well as to end a contract to manage a refinery in Curaçao. He also noted that Venezuelan navy ships neared the Dutch islands over the weekend, but Dutch officials say they were told this was part of a routine naval exercise, and maintain that the decision to release Carvajal was made on purely legal grounds.

• The New York Times has more on the Carvajal saga, providing a detailed look at the charges filed against him by U.S. prosecutors. According to one of two federal indictments against him that were unsealed last week, Carvajal is implicated in coordinating a cocaine shipment from Venezuela to Mexico, which some analysts have taken to mean that he moved beyond merely accepting bribes from kingpins towards active involvement in the drug trade.

• Buzzfeed has obtained internal Obama administration documents which show that U.S. officials expect international efforts to restrict access to “La Bestia,” the network of trains connecting Central America with the U.S. border, to be limited. This is largely because its associated dangers ensure that it is only used by 10 percent of undocumented immigrants according to the Department of Homeland Security.

• The U.S. State Department published its latest annual report on freedom of religion worldwide on Monday. As the Miami Herald reports, it notes that the Cuban government continued to allow greater freedom of religion on the island last year, lifted restrictions on foreign religious workers and returning several church properties confiscated in the 1960s.

• In a column for Colombia’s La Nacion, Senator and sponsor of a new bill to legalize medical marijuana in the country Juan Manuel Galan offers a sketch of his position on the matter, arguing that his proposal consists not of “importing a foreign model,” but of opening up a debate with Colombian policy experts over the best way of making it work there.

• As the July 30 deadline for Argentina to make a repayment deal with holdout creditors draws nearer, Reuters reports that the Argentine government is meeting with the U.S. mediator in the case today in New York in the hope of reaching a last-minute agreement. Many analysts, however, believe the prospects of avoiding a default look dim.

• Today’s Wall Street Journal features an overview of suspicions that Argentine President Cristina Fernandez and her late husband Nestor Kirchner abused their positions to increase their net worth, which rose from $2.5 million in 2003 to $17.7 million in 2010. As the WSJ notes, a prosecutor investigating ties between a construction magnate and the Kirchners alleged that the couple was laundering money via shell companies before he was suspended and placed under investigation himself.  

• Under the attention-grabbing headline “Bolivian president seeks votes in the bedroom,” the AP highlights remarks made by President Evo Morales on his re-election campaign ahead of the October vote. On Sunday, Morales reached out to Bolivian couples, saying: “The couple decides its vote in bed, and before it decides it in bed, we have to reach those people, explaining our program.” According to the president his ticket is “the only one that guarantees economic and political stability.”