An investigation in El Salvador has uncovered links between former members of the Attorney General’s office and the government of ex-President Mauricio Funes, opening a new chapter in his ongoing struggle to evade justice as his options dwindle. This comes shortly after an international body connecting financial investigation units suspended El Salvador’s membership.
On October 16, El Salvador’s attorney general issued arrest warrants against 25 people, including former President Funes, former Attorney General Luis Martínez, and Enrique Raís, a powerful businessman. They are accused of participating in a corruption scheme within the Attorney General’s Office to favor government officials and business leaders implicated in corruption cases.
“Operation Corruption” (Operación Corruptela), as it has been named, determined that the Funes government furnished then-Attorney General Martínez with perks such as vehicles, credit card payments, trips and monthly bonuses of up to $20,000. In exchange, the Martínez-led Attorney General’s Office slowed or delayed the progress of corruption cases, including one involving a gang truce.
The investigation also claims that the Attorney General’s Office diverted at least $735,866 in public funds to pay for fictitious consulting services, illegal contracts, home remodeling, and personal vehicle maintenance, telephone bills and travel expenses, among other things.
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Many of the officials and businesspeople implicated in this case have had other accusations levied against them before.
In August 2016, Salvadoran authorities issued arrest warrants against both Martínez and Raís on similar charges, alleging that the attorney general had shown favoritism towards the magnate in investigations and legal procedures against him. Martínez was arrested, but Raís fled, successfully eluding authorities. Media outlet Factum has reported that he is currently in Switzerland.
Raís owns the waste disposal company Manejo Integral de Desechos Sólidos (MIDES), one of the Salvadoran government’s largest contractors. According to the Operation Corruption investigation, under Martínez’s leadership, the Attorney General’s Office allegedly participated in illegal negotiations to grant contracts to MIDES for the destruction of chemical precursors used in the production of synthetic drugs authorities had seized.
Even before this investigation, Funes had already been accused of embezzling nearly $351 million during his presidential term. He currently resides in Nicaragua, where the government of President Daniel Ortega granted him asylum in June 2016.
The corruption operation comes amid fierce tensions between the current Attorney General’s Office and current President Salvador Sánchez Cerén over an amendment to the law that governs the AG’s Office. The amendment would give autonomy to the office’s financial investigation unit (Unidad de Investigación Financiera – UIF), shielding it from interference from other powers.
Changing the law for the Attorney General’s Office was a condition El Salvador had to meet in order to maintain its membership in the Egmont Group of Financial Intelligence Units, a network connecting the financial investigation units of more than 150 countries.
Despite warnings from the Attorney General’s Office, Sánchez Cerén — who had served as vice president and education minister under Funes — vetoed the amendment in August, claiming that it violated the country’s constitution. El Salvador was consequently suspended from the Egmont Group.
The Attorney General’s Office warned that the veto would diminish its capacity to investigate important cases, making a point to add that Funes — who has 38 information requests filed against him — would benefit the most if the country left the international network.
Funes is accused of diverting some $350 million through an account known as reserved presidential expenditures (Gastos Reservados de la Presidencia). So far during Sánchez Cerén’s presidency, it is believed that approximately $140 million may have been moved through the same account, according to a report by El Faro.
InSight Crime Analysis
The case announced by the Salvadoran Attorney General’s Office highlights the pressure weighing on the institution from multiple directions. It also shows that the conditions for investigating and successfully prosecuting landmark corruption and money laundering cases need to be improved urgently, especially given that many of them are long-term and involve members of El Salvador’s elite and organized crime.
The president’s response to the corruption scandal is worrying because it reveals his unwillingness to address the alleged crimes and raises questions about his motives.
The simple fact that the Attorney General’s Office has presented this new case against former President Funes is far from a guarantee that those charged will be effectively prosecuted. If past criminal proceedings against Funes and other powerful Salvadorans are any indication, this new set of cases will see their fair share of obstacles.
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If the situation does not improve, El Salvador could be permanently expelled from the Egmont Group as soon as July 2019. Even just the suspension is already taking its toll, as the Attorney General’s Office now faces new barriers in accessing financial information from the more than 100 countries still in the network.
Moreover, the Egmont Group has likely already notified the Caribbean Financial Action Task Force (CFATF) of the suspension, which opens up the possibility of El Salvador being added to its list of countries at high-risk for money laundering.
Perhaps the current situation should not be surprising, considering how long such issues have been occurring. On the one hand, current Vice President Óscar Ortiz has been linked to alleged money laundering for a prominent drug trafficker. On the other, in September former President Elías Antonio “Tony” Saca became the first former head of state of El Salvador to confess to laundering money produced by corruption. He was recently sentenced to 10 years in prison.