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Guatemala: How a corruption scandal forced the president's hand

A UN-backed commission in Guatemala has uncovered a corrupt customs network, implicating senior officials. Its campaign against impunity has won public support from unlikely quarters and rattled the country's political elite. 

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Farmers take part in a protest to demand for the resignation of Guatemalan President Otto Perez Molina in Guatemala City, May 20, 2015. The protest comes in the wake of a scandal involving the former vice president Roxana Baldetti, who resigned earlier this month over allegations she was involved in a customs corruption racket, local media reported.

Josue Dekavele/Reuters

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Tens of thousands of Guatemalans marched in heavy rain over the weekend calling for the resignation of President Otto Pérez Molina and speaking out against corruption. They blew whistles and banged pots and pans, and later released blue and white balloons – the colors of the Guatemalan flag.

The peaceful demonstrations highlight growing public anger over multiple corruption scandals uncovered by a UN-backed crime-investigations unit, including a customs fraud network known as “La Linea” (The Line). The investigation has led to some 29 high-profile arrests and forced the resignation of Vice President Roxana Baldetti whose private secretary was implicated. On Wednesday, the central bank governor was arrested in connection to a separate case involving social security fraud. 

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The corruption scandals and resulting outrage come at a pivotal moment for President Pérez Molina and the International Commission Against Impunity in Guatemala (CICIG). Its mandate was set to expire in September and Pérez Molina had said he wouldn’t invite the commission to stay, despite international pressure. Since 2007, the CICIG has investigated several high-profile cases and acted as a check on rampant corruption and impunity for public officials. Many members of Guatemala’s business and political elite resent its work and fear its reach. 

But the collective outrage that broke out after La Linea was exposed last month has united disparate voices against the president and for a renewed mandate for the CICIG. Backed into a corner, Pérez Molina agreed to a two-year extension. Analysts say this could be an important step towards greater public engagement with the fight against corruption and abuses of power. 

“The citizenry has woken up,” says sociologist Álvaro Velásquez. “Guatemalan society is in a state of effervescence and is ready for change. What we need to do now is find ways of channeling that.”

“Not renewing CICIG’s mandate would have been good news for criminal organizations,” says political analyst Renzo Rosal. “They are afraid of CICIG because it’s like an incandescent light shining on them.”

New approach to tackling organized crime

In 2007, the UN ventured into unchartered territory here. It accepted the government’s request to create a multilateral body that would investigate organized crime and train local prosecutors.

Working side-by-side with Guatemalan institutions, CICG has scored important victories. In 2010, it solved the murder of Rodrigo Rosenberg, a lawyer who engineered his own assassination in order to destabilize the administration of the previous president. Two years later, it arrested former police chief Marlene Blanco Lapola, accused of running a death squad.

Although these results won widespread support from civil society, Pérez Molina opposed CICIG’s presence. His tense relationship dates back to the trial of former dictator Efraín Ríos Montt in 2013, which revealed uncomfortable information about the president's own military past.

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After Gen. Ríos Montt’s genocide conviction was overturned due to a legal technicality, CICIG spoke out, saying Guatemala needed to move forward with the trial in order to guarantee judicial independence. The move vexed the current administration and business elite.

“Many [business leaders] didn’t want to see military officers go to prison,” says Roberto Castañeda, a former president of an influential private sector lobby known as CACIF. “They were afraid the names of landowners who had defended their land during the war would come out,” Mr. Castañeda says, referring to the role of large landowners during the civil war that ended in 1996.

But then came La Linea, and everything changed.

A turning point

Investigators used over 60,000 wiretaps to show that in exchange for bribes, senior customs officials set up a parallel payment schedule for customs duties, benefitting a number of businesses here. References made on tape to “La Dos” (The number two) and “the president" suggested that the network went all the way up to the head of state. 

CICIG’s investigation put the business community – which had been seen as aligned with the political elite – in an awkward position.

“CACIF [the private sector lobby] had no choice but to support CICIG because the private sector [was] greasing the palms of the organized crime structures within the customs bureaus,” says Mr. Rosal, the political analyst. “The private sector has been inevitably tainted by [the scandal].”

Trying to distance itself from the Pérez Molina administration, the CACIF made an unexpected u-turn. It swung behind CICIG, calling for a “national crusade against corruption.”

Ms. Baldetti resigned as vice president on May 8, but that hasn’t placated demonstrators. A new citizen movement, largely organized via social media, has emerged calling for the resignation of Pérez Molina as well. The next demonstration is scheduled for May 30.

“I’m going to continue taking part in the demonstrations,” says Lenin Rodriguez, a young IT engineer at Saturday’s demonstration. “The challenge will be turning this into a long-lasting movement.”