Will the La Linea corruption scandal break or make Guatemala?

Will the La Linea corruption scandal break or make Guatemala?
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Otto Pérez Molina resigned from the Guatemalan presidency on Wednesday, September 2, after the attorney general issued a warrant for his arrest amid corruption allegations and public unrest.

On September 1, 2015, Guatemala’s Congress voted unanimously to strip away President Otto Pérez Molina’s immunity, in the hope that he be tried and convicted for corruption.

Pérez Molina’s arrest is the result of Guatemala’s Justice Department, in close collaboration with the United Nations International Commission against Impunity in Guatemala, known as CICIG, investigating a corruption scandal known as La Linea “The Line.” According to the CICIG, the Guatemalan customs agency offered importers reduced tariffs in exchange for benefits that were shared among dozens of government officials.

Since the La Linea scandal hit the headlines last April, a total of 14 cabinet ministers have resigned, saying they felt “let down” by evidence of Pérez Molina’s involvement in La Linea.

Investigators believe Pérez Molina received $3.7 million in bribes paid by importers in exchange for illegal discounts on their customs duty.

Prosecutors have already charged former vice-president Roxana Baldetti, who resigned in May, with taking $3.8 million in bribes between May 2014 and April 2015.

The accusations have evoked outrage in the small Central American country of 15 million people, where 53.7% of the population lives in poverty.

The La Linea scandal was uncovered by investigators from CICIG tasked with fighting high-level corruption in Guatemala, where they found a considerable amount of evidence that Pérez Molina helmed this hotline scheme.

Investigators say their accusations are based on 89,000 wiretapped phone calls, 5,906 emails, and some 175,000 documents. In addition, CICIG received help from the United States, which provided nearly $21 million to finance its work, including investigations into the flow of drug money streaming into Guatemala’s party system.

General elections were held on Sunday, September 6. Pérez Molina did not run, as he was not eligible due to term limits. The leading candidates were Manuel Baldizon, Jimmy Morales and Sandra Torres. Manuel Baldizon is widely regarded as Perez Molina’s closest ally.

According to the latest polls, the only candidates who pose a serious challenge to Baldizon are Jimmy Morales, a comedian who is running based on his outsider status, and Sandra Torres, the ex-wife of former President Alvaro Colom.

In a recent poll by Prensa Libre, around 18% of voters surveyed said they’d vote blank or null.

In a recent poll by Prensa Libre, around 18% of voters surveyed said they’d vote blank or null.

In Guatemala, a candidate needs to win more than half of the votes to get past the first round. Since none of the candidates reached the minimum share of votes, a second round of voting between the two candidates with the most votes will be held October 25.

And so, although the corrupt infiltration of Guatemalan institutions has devastated the country, rooting it out could become yet another source of uncertainty and chaos. The question remains if Guatemala’s remaining elites, fearing they might be next, might do something drastic to bring political stability back to the country.

Looking at the region as a whole, both Honduras and El Salvador face major political and security crises, so there’s a risk that Central America’s Northern Triangle may spiral out of control.

Historically, corruption has defined Guatemala for so long that it is difficult to say what the country will look like if corruption is eliminated once and for all.

Categories: Latin America, Politics

About Author

Yesenia Lugo

Yesenia Lugo has written and worked on global governance and international financial institutions (IFIs) for a Washington, D.C. NGO. Her interests include economic opportunities, emerging financial markets and fiscal transparency reform. Yesenia holds a Masters in Diplomacy and International Relations from Seton Hall University, where she specialized in economic development and international security.