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Volume 15, Number 13
July 28, 2009

news special

Also in this section:
Martinelli moves in on another Amador deadbeat's illegal marina
Bosco certified as mayor
US consulate and embassy alter their hours
Push comes to shove on PRD "civil service" appointments
Martinelli's Kuna and Embera governors
Martinelli's ambassadors
City moves to gut historic controls in Casco Viejo

Copy of a note alleged to be handwritten by former CEMIS exec Stephen Jones

Reopened investigation could alter more than one political pecking order

Years later, high court reopens CEMIS case
by Eric Jackson

If some local journalists are calling it "the country's biggest scandal" --- and some are --- that mostly says unflattering things about not only the state of those reporters' historical knowledge, but also about their memory of recent events. Hundreds of people poisoned to death by cough syrup mixed at a government lab is a lesser matter? All the political murders and disappearances of the 21-year-long dictatorship pale in importance? The still-unsolved 1955 murder of President José Remón suddenly becomes a relative trifle? It is, of course, a matter of opinion which facts in the news are important --- just as it's newsworthy to know who plays up and who plays down a particular story.

The CEMIS case is about allegations that bribes were paid to legislators back in 2001 to get a concession to expand the France Field airport into a facility that can handle jets and international flights; build an adjacent container handling interface among the airport, the Manzanillo International Terminal and Colon Container Terminal seaports and the Panama Canal Railroad; and surround the whole thing with a commercial and light industrial zone. The allegations when the court stopped the prior investigation named only three men, but that was almost certainly the limiting partisan influence of the flagrantly pro-corruption attorney general of that time, José Antonio Sossa. Other published tales touch about 15 current legislators and a number of former ones, most but not all from the PRD.

When one considers who was said to have been involved and compares them to the factional lineups both within the PRD and to a lesser extent in Martinelli's governing coalition, however, that could provide ammunition for major political firefights.

A chronology

To summarize the events in this case:

September 2001 --- The Moscoso administration proposes a 30-year renewable concession contract with Consorcio San Lorenzo, whose two principal executives were the Panamanian Martin Rodin and US citizen Stephen Jones, to build and operate the Centro Multimodal, Industrial y de Servicios (CEMIS). However, Moscoso was unable to mobilize a majority in the legislature at this time, and the proposed concession was stalled in the face of deputies' objections that the government was giving too much away.

October through December, 2001 --- CEMIS runs into opposition from Colon Free Zone merchants and environmentalists at heated sessions of the Legislative Assembly's Commerce Committee (then headed by Laurentino Cortizo, at the time a Solidaridad deputy allied with the PRD, who later joined the PRD), and gets handed back to President Moscoso for modifications. On December 6 Cortizo convenes a closed door meeting among himself, CEMIS representatives, then Comptroller General Alvin Weeden, then Legislative Assembly president Rubén Arosemena (Partido Popular, allied with the PRD), then Minister of Commerce and Industry Joaquín Jácome, and possibly others. It was reported that the Moscoso administration agreed to make changes and resubmit the proposal to the legislature.

December 29, 2001 --- In the usual mad rush at the end of the second 2001 legislative session the CEMIS concession, having breezed through the Commerce Committee, passes unanimously on third and final reading in the legislature.

January 3, 2002 --- Sergio Gálvez, a legislator of Mireya Moscoso's coalition who hardly ever showed up at Legislative Assembly meetings, is seen and photographed at his desk in the assembly's chambers, counting cash from a manila envelope.

January 9, 2002 --- Mireya Moscoso's two nominees to the Supreme Court, Winston Spadafora and Alberto Cigarruista, are approved in a 36 to 35 vote wherein PRD legislators Carlos Afú, Tomás Gabriel Altamirano Duque and Carlos Alvarado broke ranks and voted for ratification. Altamirano Duque's family business had a government contract to print lottery tickets at stake. It is said that Alvarado broke ranks due to a combination of personal friendships with the nominees and the Moscoso administration spending money on projects in his legislative circuit. But Balbina Herrera and Pedro Miguel González accused Afú of taking a $1.5 million bribe to vote for Mireya's high court nominees.

January 16, 2002 --- Afú holds a press conference at which he waves $6,000 in cash. He said it came to him in a manila envelope on December 29, 2001 and was one of many envelopes of cash in a cardboard box in the office of then PRD deputy Mateo Castillero for distribution to various of his colleagues. Afú said that Balbina Herrera, then both a fellow legislator and president of the PRD, got $150,000, as did Héctor Alemán, then a legislator and party undersecretary and later the presidential campaign manager for Martín Torrijos in 2004 and Balbina Herrera in 2009. Afú alleged that the mastermind of the whole bribery scheme was Miguel Bush, then a PRD deputy from Colon, who allegedly received "much more" than either Herrera or Alemán. Afú further asserted that there was a second distribution of cash, this time $14,000 apiece, to the legislators who had voted for CEMIS. Afú said that then deputy Manuel de la Hoz was present when he picked up his envelope at Castillero's office. Tomás Gabriel Altamirano Duque told La Prensa that day that Castillero had offered him money but that he did not accept it.

January 17, 2002 --- The Attorney General begins an investigation of the bribery allegations.

February 27, 2002 --- The Attorney General petitions the Legislative Assembly to lift the immunity from investigation and prosecution of all of its members, so that an investigation of bribery allegations related to both the CEMIS matter and the ratification of the Supreme Court nominees can be investigated.

April 12, 2002 --- The Supreme Court holds that the legislators did not have immunity when the bribery investigation began.

December 31, 2002 --- Attorney General Sossa recommends bribery charges against Rodin, Jones and Afú, the end of the investigation of Castillero and no action against any other person.

June 30, 2003 --- The Legislative Assembly's rejects the request to lift any legislator's immunity.

September 17, 2003 --- By a 6-3 vote the Supreme Court reverses itself and declares that the bribery investigation was illegal because the legislature had not lifted its members' immunity. It went further and ruled out any case against non-legislators Rodin and Jones, holding that when an immune person is accused of committing a crime in league with a non-immune person, the immunity of the former attaches to the latter. Jones, having been free on $1 million bail, takes advantage of the ruling to leave Panama. Rodin, protesting his innocence in the affair, stays in his native Panama.

October 10, 2003 --- Supreme Court magistrate Cigarruista, who had been a legislator when the CEMIS concession passed, tells a national television audience that there were bribes paid, that he knows who paid them and who received them, and that he has given this information to the Roman Catholic Archbishop of Panama, José Dimas Cedeño and Attorney General Sossa. (To date, neither Cigarruista, Cedeño nor Sossa have disclosed such details.)

March 8, 2004 --- A motion for reconsideration of the Supreme Court's September 17 decision, made by the Attorney General's alternate, Mercedes Arauz de Grimaldo, while Sossa was away, is rejected by the high court on procedural grounds.

March 18, 2004 --- Manuel De La Hoz says that he lied in his initial denials of Afú's allegations, and that virtually the entire PRD caucus lied, in order to protect party leader and then presidential candidate Martín Torrijos.

January 1, 2005 --- New constitutional provisions go into effect, one of which is that the Supreme Court, not the legislature (now renamed the National Assembly), makes decisions about lifting legislators' immunity.

March 3, 2005 --- The new Attorney General, Ana Matilde Gómez, petitions the Supreme Court to reopen the CEMIS case.

July 2009 --- The Martinelli administration comes into office and discovers that its predecessor, considering the CEMIS concession dead, had granted concessions on 47 parcels of land on or near the France Field Airport, where the CEMIS concession had been located, to expand the Colon Free Zone. There was an unspecified plan to build a new airport for Colon elsewhere. Martinelli, who wants to upgrade France Field to an international airport notwithstanding the CEMIS affair, cancels these concessions.

July 22, 2009 --- The Supreme Court, after a more than four-year delay, rules on Gómez's motion and unanimously decides to reopen the CEMIS case. There is no precedent for reopening a closed case in such a fashion, and the decision reversed the usual rule that any investigation begun against someone who's immune from investigation is not only null and void but it prevents any subsequent investigation or prosecution in the matter. Still to be issued is the high court's order about who will conduct the investigation. Gómez wants the case assigned to her office, but the court could appoint one of its members or, theoretically, any other attorney, to act as prosecutor.

July 27, 2009 --- Gómez delivers two video tapes to the Supreme Court. These are purportedly of two December 2001 conversations among former President Ernesto Pérez Balladares, former Labor Minister Mitchell Doens, former legislator Manuel De La Hoz and legislator Carlos Afú. These recordings may have been made surreptitiously --- and if that's the case, illegally --- by Pérez Balladares. They are said to contain detailed admissions about the bribery of legislators to assure the CEMIS concession's passage, and talk of a role that Martín Torrijos played in the transaction. The former president claims that he had given copies of these recordings to former Attorney General Sossa some seven years ago.

Today's political context

In the wake of the PRD's crushing defeat in this past May's elections, Balbina Herrera declared that she's party president and thus leader of the opposition until 2014. It is widely presumed that she wants to run for president again in that year.

Balbina Herrera, Martín Torrijos and Héctor Alemán could be run out of political life by this case, and party factions whose leaders had already called for their resignations from party offices in the wake of last May's defeat are, not surprisingly, calling for a full investigation. Chief among those calling for new PRD leadership and applauding the reopening of the CEMIS case are Balbina's primary opponent and later running mate, former Panama City Mayor Juan Carlos Navarro, and former President Pérez Balladares.

So is this the definitive scandal from the PRD perspective? Maybe not. Still lingering out there are investigations of the 35 tons of bronze statues that disappeared from the custody of former first lady Vivian Fernández de Torrijos, and of the poisoned medicine scandal. These, too, could be the monsters that slay political reputations and careers.

Meanwhile, Vice President Juan Carlos Varela fought long and hard to establish his dominance of the Panameñista Party, against various opponents but most of all against Mireya Moscoso's clique. So does this scandal taint legislators and former legislators on both sides of the aisle? If so, it would hurt Mireyistas and not much affect Varela's faction.

One of the top vote getters in Martinelli's Cambio Democratico party, legislator Sergio Gálvez, may have trouble answering questions about the envelope full of cash that he was seen counting. Afú was re-elected in 2004 as an Arnulfista, and this past May as an independent, and votes with the Martinelli alliance in the assembly. However, even at the risk of some losses on his own side, Martinelli cheered the reopening of the CEMIS case.

The Supreme Court, meanwhile, is dominated by PRD presidents' appointees --- but that does not necessarily mean that they're aligned with the faction that led the party to defeat. As a matter of hardball politics, the magistrates also well know that Martinelli has the votes in the legislature to expand the court's membership and thus erase any PRD majority. So might it be a pragmatic move to reopen a case that could also bring down one of their colleagues, Alberto Cigarruista? That would give Martinelli one more vacancy to fill than he would ordinarily get.

Legal conundrums

So, when did the last act of the CEMIS affair occur? Was Gómez's motion to reopen the case in the nature of a "trial?" These questions probably matter. If the last act of the CEMIS scandal was in December of 2001 or in the following month, and there was no "intervening trial," then arguably the statute of limitations has run on this case. Under the Penal Code that was in effect at the time, this would have been six years.

Meanwhile, Stephen Jones is gone and the United States (if that's where he is) has no extradition treaty with Panama. (It does have the Foreign Corrupt Practices Act, but that's another case in another jurisdiction if it arises.) The note at the top of this article, if it can by handwriting or fingerprints be attributed to him, could be fairly damning --- to Jones. But what, if any, evidence would there be to directly link Rodin to bribery? Jones could be tried in absentia, but in his absence it may be hard to prove anything against anyone else on the CEMIS end.

Did people know about and consent to those recordings that Toro Pérez Balladares produced? And even if they pass the screen of legality, how much of their contents is admissions about things in which the people speaking have direct personal knowledge, and how much is political bochinche? And if the tapes either can't be used or can be but don't prove much, might they provide leads to more solid evidence? Panama doesn't have a US-style "fruit of the poisoned tree" doctrine about improperly obtained evidence.

Who is going to conduct this investigation, and what motives might she or he have? These are rude questions, but this is Panama. A prosecutor taking a dive and losing a solid case, a judge ignoring the evidence, undue influences being brought to bear --- none of this would be unprecedented here.

But maybe, just maybe, three people coming from very different backgrounds --- Supreme Court President Harley Mitchell, Attorney General Ana Matilde Gómez and President Ricardo Martinelli --- truly intend to lead this country into a new era in which corrupt old ways will not be tolerated. If that's the case, then whatever happens with the CEMIS case may be anti-climactic because there are plenty of other political scandals floating out there to be used to set examples.

Also in this section:
Martinelli moves in on another Amador deadbeat's illegal marina
Bosco certified as mayor
US consulate and embassy alter their hours
Push comes to shove on PRD "civil service" appointments
Martinelli's Kuna and Embera governors
Martinelli's ambassadors
City moves to gut historic controls in Casco Viejo

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