Envío Digital
Central American University - UCA  
  Number 228 | Julio 2000




Envío team


Fallout from the June 7 resolution of the Office of Comptroller General (CGR) on the "check scam" corruption case involving Byron Jerez, head of the state’s General Income Department (DGI), was not long in coming. To date the best documented and most highly publicized corruption scandal headed by a top Liberal government official, the case involved, among other activities, 14 sizable checks illicitly made out to fictitious individuals. It attracted national and international attention partly because Jerez is extremely close to President Alemán and partly because the CGR decision was the first test of how the five new comptrollers in this collegial institution restructured by the Alemán-Ortega pact would carry out their duties.

It failed the test. The resolution simply recommended that two of "the President’s men," Jerez and Jorge Solís, "cease in" their posts, citing them as "administratively responsible" for the embezzlement, and determined that Jerez must pay a fine of 480,000 córdobas (approximately US$38,000). The element that caused the greatest disappointment and outrage among observers was the resolution’s conclusion, after the CGR did only a superficial investigation of minimum documentation, that there was no cause for penal action.
Upon learning the content of that resolution, Jerez had congratulated the CGR for its fairness. Seeking to avoid any impression that he was being dismissed, he ostentatiously crowed that he had resigned "voluntarily" from his DGI post to run for National Assembly legislator and only waited so long because he had wanted to stay and "supervise" the investigation leading to the resolution. Jerez’s position in the DGI went to Rodolfo Escobar, husband of the President’s chief assistant and another of his unconditional supporters back from when Alemán was mayor of Managua.
The diplomatic representatives of the Group of Five (Germany, Canada, Spain, United States and Sweden) plus Japan, formed to follow up the post-Mitch Stockholm commitments, published a brief statement on the resolution on June 9. Displaying the diplomats’ particular concern about the government’s unwillingness to sanction Jerez’s corrupt behavior, the text concludes as follows: "We hope that these individuals who are leaving office do not occupy other positions of trust. That way the Government would demonstrate seriousness in its fight against corruption."
Upon concluding his posting in Nicaragua, Swedish Ambassador Jan Bjerninger also expressed his disappointment with the new CGR’s work. He urged that this watchdog institution "complete" its cursory investigation into the Jerez scandal and investigate "fully, professionally and independently" not only this case but also those related to the "illicit enrichment" of government officials. Implicit in this latter reference was an allusion to a CGR investigation into the astronomic rise in Alemán’s personal wealth in recent years, a study that was underway when the new comptrollers took office and was promptly truncated.
Three days after the Group of Five statement was released, President Alemán finally signed two agreements, canceling Byron Jerez’s appointment as secretary general of the Ministry of Treasury and Jorge Solís’ as president of the board of directors of ENITEL, the state’s electricity utility. Striking a very different pose than Jerez, Solís, who at the time of the scam had headed PETRONIC, which actually issued the checks on DGI orders, blamed Jerez for the entire scandal. Two days later, Jerez was formally dismissed as head of the DGI by the treasury minister, but will apparently continue representing the state on the board of the recently privatized Nicaraguan Bank of Industry and Commerce (BANIC) and will remain at his post as treasurer of the governing Constitutionalist Liberal Party.

Then on July 1, Judge Walter Solís "closed" a lawsuit brought against Jerez for fraud against the state, declaring a definitive stay of proceedings in his favor. Rafael Córdova, former probity director for the CGR and the person who had initiated the investigation into the DGI check scam in 1999, was among four citizens to file suit, in his case on June 7 in the First District Criminal Court of Managua only hours after the CGR resolution was made public. He had chosen this particular court because it was presided over by Judge Marta Quezada, who Córdova praised as honest and fair. In an abusive legal maneuver, Jerez’s lawyers succeeded in taking the case out of Quezada’s hands; it finally landed Judge Solís’ court. In contrast to Quezada, he followed none of the judicial procedures required to investigate the case before quickly handing down his decision—which the triumphant Jerez himself announced during a party in his honor celebrated the same night. Three days later, Judge Solís triggered yet another scandal by summarily closing the case of the cold-blooded murder of a poor peasant named Pablo Leal by Alejandro Carrión, brother of the current head of the Army of Nicaragua. Despite justified national indignation, the Supreme Court decided to maintain Solís in his post.


Benjamin Gilman, who heads the House Foreign Relations Committee in the US Congress, is promoting a bill to suspend financial aid to Nicaragua because it still has not resolved claims to some 50 properties that the Sandinista government confiscated in the eighties from Nicaraguans who are now US citizens. According to US Ambassador Oliver Garza, the Liberal government has not treated these claims "seriously."
Suspension of the aid, which has steadily decreased over the course of the nineties to about US$50 million a year, would involve canceling a waiver that exonerates Nicaragua from the US policy of freezing aid to any country in which US citizens have had property confiscated. This, in turn, would have even more serious consequences, torpedoing the reduction of Nicaragua’s debt in the HIPC initiative and obliging the International Monetary Fund, the Inter-American Development Bank and the World Bank—institutions in which the United States is the largest contributor—to vote against any loan to Nicaragua.

On June 25, a delegation of Nicaraguan legislators traveled to the United States to lobby against the Gilman bill. According to official information, Nicaragua has spent US$735.5 million (in both cash and bonds) to indemnify all types of confiscations that occurred during the Sandinista government. This figure represents 15% of the national budget for each of the past seven years and more than was spent on education and health in the same years.


On July 3, Rosa Marina Zelaya, who presided over the Supreme Electoral Council during the controversial 1996 elections following the resignation of her predecessor and close colleague Mariano Fiallos in protest against the changes made to the electoral law the previous year, lost her battle to keep her post. The Supreme Court threw out her charge of unconstitutionality against the legislative reforms agreed to in the PLC-FSLN pact that reduced her term of office. Earlier that same day five new CSE magistrates and three alternates were elected—most of them from those same two parties—as another key piece of the pact. Zelaya’s departure satisfies one of Daniel Ortega’s most frequently reiterated political wishes. He has consistently claimed that he lost the 1996 elections due to fraud and blames Zelaya, who left the FSLN in disagreement with his leadership in the mid-nineties, though providing no evidence to substantiate the charge.

Four days before she was forced to leave the CSE, Zelaya filed a denunciation with the Nicaraguan Human Rights Center (CENIDH) charging a strategy of intimidation against her by political groups that she did not identify. The intimidation began when FSLN leader Emmet Lang, appointed some months ago as a CSE magistrate, claimed that the 1996 election records had disappeared. He accused Zelaya, threatening her with prison for this "irresponsibility." She in turn claims that both the archives where these records were kept and her own office had been broken into and the records presumably robbed. The National Police, which initiated an investigation, concluded that there was no evidence.


On June 28, Agustín Jarquín resigned as one of the five comptrollers in the new collegial CGR. Getting rid of this embattled and lonely fighter for honesty and transparency in government had been one of the most visible objectives of the pact—as important to Alemán as Zelaya was to Ortega. Among other methods for neutralizing Jarquín, including jailing him on trumped-up corruption charges, the pact’s two architects decided to name four additional comptrollers this past February, splitting the posts among their respective supporters.

Since that time, Jarquín, fifth among supposed equals, had periodically denounced changes taking place in the CGR that would undermine its transparent functioning. Upon turning in his resignation to the National Assembly, which had originally named him comptroller general nearly six years earlier, Jarquín argued that the CGR’s work has been perverted since the consummation of the Alemán-Ortega pact. When the resolution was issued on the Jerez case, there were two dissenting voices among the five: one of the new Sandinista comptrollers, who argued merely that the channels of investigation had not been exhausted, and Jarquín, who alone insisted that enough evidence existed to take the case to court.


In mid-June, Amnesty International released its Report 2000, which documents the violation of human rights around the world in 1999. With respect to Nicaragua, the report includes the weakening of institutions, particularly of the Office of Comptroller General, provoked by the FSLN-PLC pact. It specifically refers to the imprisonment of former Comptroller General Jarquín, who the report states "had taken a decisive step forward in revealing various serious corruption cases."


The United Nations Development Program (UNDP) presented its Human Development Report 2000 in San José, Costa Rica on June 29. Unlike the Amnesty 2000 report, this one covers data from 1998, when Nicaragua was showing slight improvements in its low living standards before Hurricane Mitch hit toward the end of that year. Of the 174 nations studied, Nicaragua moved up from 121st place to 116th. Within the hemisphere, it moved from second only to Haiti to third from the bottom, with Guatemala now below it as well. Those who know Guatemala, however, say that the shift grows more out of deteriorating conditions in that country than improvements in Nicaragua.

One particularly hair-raising piece of information is that Nicaragua has the fourth worst figures on domestic violence against women, with 28% of the female population attacked by a family member. The only countries below it are Bangladesh (47%), New Zealand (35%) and Barbados (30%).


On July 6, an earthquake registering 5.4 on the Richter scale caused major destruction to the northwest slopes above Laguna de Apoyo, a small volcanic crater lake near Masaya and 35 km from Managua. The quake, centered less than a kilometer below the earth’s surface, was followed by dozens of aftershocks, causing ongoing destruction to hundreds of poorly constructed shacks in the impoverished villages around the lagoon, as well as landslides in the hillside itself. Collapsing roofs killed three children and injured a number of people.

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