Another Top Peru Politician Embroiled in Odebrecht Scandal

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With four former presidents either in jail or fleeing arrest and another top politician now facing allegations of money laundering, Peru is steadily uprooting the entrenched corruption plaguing its political system. But without much-needed legislative reform, its institutions will remain susceptible to criminality.

Keiko Fujimori, founder and president of the right-wing Popular Force (Fuerza Popular – FP) political party and a presidential candidate in 2011 and 2016, has been accused of receiving illegal funding for her presidential campaign from the Brazilian construction giant Odebrecht. The sweeping Odebrecht scandal has so far incriminated dozens of high-ranking officials across at least 12 Latin American countries, including two former Peruvian presidents.

The Peruvian publication IDL-Reporteros recently published previously unseen documents relating to the case, including a string of messages found on a cellphone belonging to Marcelo Odebrecht, the former CEO of the company who was sentenced to 19 years in prison in Brazil. The cellphone messages made explicit references to a parade of politicians, companies and countries, suggesting their involvement in the transnational money laundering scheme — including Keiko Fujimori.

Though brief, Odebrecht’s message could have strong implications: “Raise Keiko to 500 and I’ll go for a visit,” he reportedly stated in the correspondence. According to IDL, the note was most likely sent in late 2010 or early 2011 — right at the height of Keiko’s presidential campaign, bringing buried probes of illegal campaign financing from that period back into the light.

In a May statement to Peruvian prosecutors, Odebrecht openly admitted to financing the majority of, if not all the 2011 Peruvian candidates, through the help of his Peruvian subordinate Jorge Barata.

Barata “thought Keiko Fujimori was going to win, so I told him, ‘If you think there’s a risk of reprisal, support her more,’ I even made a little note at that time, ‘Send Keiko more support,'” he stated.

Fujimori, whose 2011 campaign was beleaguered by allegations of illegal funding and whose political party has seen multiple members face charges of collusion with drug traffickers, has denied receiving any money from Odebrecht.

“Fujimorismo,” a reference to the dynastic political power of Keiko’s family, became associated with corruption and criminality in Peru following the 2005 arrest of Keiko’s father and former Peruvian president Alberto Fujimori, who is currently serving out a 25-year sentence for human rights violations and corruption carried out during his decade of autocratic rule.

InSight Crime Analysis

The allegations raised against Keiko, particularly given the legacy of her last name, serve as yet another reminder to the Peruvian people of the extent to which criminality has become institutionalized in their political system. Though the country is now taking major steps to prosecute corrupt leaders, unaddressed loopholes in Peru’s electoral system continue allowing scandals like Odebrecht to undermine democratic institutions.

As of this year, four former heads of state in the country are currently in jail or wanted for criminal ties, human rights violations, corruption, or a combination of all three.

In February, Peruvian authorities ordered the arrest of former president Alejandro Toledo for helping the Odebrecht construction company secure public contracts in exchange for kickbacks worth up to $20 million. In July, former president Ollanta Humala joined Fujimori’s father in the Barbadillo Lima prison on charges of extrajudicial killings and corruption.

The only living former president not arrested is Alan García, but he has a robust reputation for corruption and is currently under investigation by the Attorney General’s Office for alleged money laundering and accepting bribes from Odebrecht. And though the current president Pedro Pablo Kuczynski vowed to fight institutional criminality following the outbreak of the Odebrecht scandal in Peru, even he has been implicated in the graft.

SEE ALSO: LatAm Presidents and the Law: Is Era of Impunity Nearing Its End?

In the 2016 Transparency International report, which ranks over 170 countries according to annual corruption levels, Peru came in at 101, a sharp decline from its ranking of 88 the previous year.

A main reason for its low ranking, according to Walter Albán, executive director of Transparency International’s Peruvian chapter, is Peru’s largely unregulated electoral system which allows criminal organizations and fraudulent businesses to infiltrate the political arena.

The unregulated electoral system “is causing levels of corruption to reach extremes that haven’t been seen in the country before,” Albán told InSight Crime. “It is clear that the current situation generates incentives for people who are linked to the illegal economy and who are trying to enter politics. We are seeing this more and more strongly every year.”

Peru’s political system has long allowed for widespread corruption and impunity, said Albán, creating cycles of criminality amongst top political leaders despite their being democratically elected. Lax controls on campaign financing have allowed criminal groups, wealthy corporations and foreign governments to pour money into party coffers and candidate pockets. Often these payouts will be conditioned on returned favors once the candidate has reached office.

In April of this year, Peru’s executive branch passed a series of electoral reform proposals with the main objective of reducing corruption in local and national elections, including limits on individual cash donations and a required registration of companies, institutions or foreign governments at least three years prior to donating to a campaign. So far, these proposals have not been passed into law.

There have also been numerous requests this year from the Supreme Court to lift the so-called law of parliamentary immunity for various congressmen investigated for criminal activities. As it stands now, the law maintains that an elected congressional representative currently in office can only be prosecuted if the congress itself authorizes the proceedings.

Critics argue the immunity law has acted as a shield against justice for high-ranking politicians, even when the Attorney General’s Office or regional prosecutors have opened investigations directly against them, such as the case of Congressman Benicio Ríos Ocsa, who has remained in office despite being tried in the Cusco region for alleged criminal collusion and passive bribery.

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Despite such investigations, a congress embroiled in criminal allegations has “systematically” refused to lift the immunity and has obstructed other electoral reforms, according to Albán.

“Electoral reforms aimed at filtering out dirty money from entering politics have been debated for years now but there is enormous resistance,” he stated. “This has a lot to do with the fact that political organizations themselves are being penetrated by criminals. There are representatives in congress right now who have been and are linked to the illegal economy. And there are congressmen who directly protect [criminal] interests.”

Fujimori’s case may be even harder to prosecute. The Popular Force currently maintains a strong majority in congress, occupying 72 seats out of 130, and the party continues to bolster its dominance in the legislature, even passing a law to obstruct opposition members from being re-elected late last year.

The Odebrecht scandal and others, however, have shaken Peru and invoked a strong reaction of indignation among Peruvian citizens, Albán stated, which anti-corruption advocates hope to transform into consolidated action.

“For the first time the problem of corruption appears as the main problem in the country. This is certainly something remarkable,” he said.

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