Corcione defies prosecutors, envelopes the ACP in a cloud of corruption

Don Corcione
Nicolás Iván Corcione Pérez Balladares, construction executive and Panama Canal Authority board of directors member who allegedly coordinated a bribery, kickback and money laundering scheme for contracts for the construction and renovation of Panama’s courts. The scheme was said to have been orchestrated by now imprisoned former Supreme Court president Alejandro Moncada Luna and some of the money trail led through a maze of companies, the owner of one of which has testified that a sum of $600,000 was divided between Corcione’s company, which got $200,000 and another company owned by Martinelli insiders Alejandro Moncada Luna, Felipe Virzi and Ricky Calvo, into the Banco Universal account of which was deposited $400,000.

Nicolás Corcione skips a deposition with the prosecutor as his lawyer asserts that as a member of the Panama Canal Authority board of directors Corcione is immune from dealing with prosecutors and the regular court system

ACP board member seeks to
be untouchable for bribery

by Eric Jackson

This is how it works, or at least how embattled Panama Canal Authority board of directors member Nicolás Corcione and his lawyers want it to work:

  • An investigation has begun, in which Corcione’s name has come up both as the coordinator of a bribery – kickback – money laundering scheme and as a recepient of $200,000 for playing that role. Prosecutors took a closer look at Corcione and called him in for questioning under oath — an indagatoria, one of the depositions that are central to Panamanian criminal proceedings.
  • As the investigation began, Corcione left the country and via his lawyers begged off on the indagatoria until he came back. The interrogation was rescheduled for August 5, but on that day he didn’t show up and his lawyer asserted that under the Judicial Code and the Constitution, prosecutors and ordinary court have no jurisdiction over him, that only the Supreme Court can investigate, prosecute and try him.
  • It is one of the rules of Panamanian criminal procedure that if a criminal investigation is begun by a prosecutor who has no constitutional jurisdiction, everything about that investigation is null and void and no new investigation about the same matter may be opened, at any level.
  • Since the law that created the Panama Canal Authority provides that members of the board of directors may only be removed for cause, and since any criminal proceedings against Corcione would be barred, he would keep his position on the ACP board.

Neat trick, isn’t it?

Except that Title XIV of Panama’s Constitution, the part about the Panama Canal, doesn’t directly say what Corcione and his lawyers claim that it says. Article 318 provides that:

The administration of the Panama Canal Authority shall be run by a board of directors composed by 11 directors, appointed in this way:
1. A director designated by the president of the republic, who will preside over the board of directors and shall have the condition of state mininster for canal affairs…

The other members of the board of directors are not given the status of ministers. Then when you go to Article 40 of the Code of Criminal Procedure — which was in force before the Panama Canal Authority was created — it provides that the Supreme Court’s Criminal Bench shall hear cases involving vice ministers, prosecutors, appeals court judges, top police officers, diplomats and a variety of other officials, including “the directors and managers of autonomous and semi-autonomous entities and those who work in whatever other post with authority and jurisdiction in all of the territory of the republic….” A government minister is a member of the executive branch with authority and jurisdiction. A member of an authority’s board occupies a post in a collegial policy-making body, but has no authority in an individual capacity to issue orders to those who work for the authority.

In the case of the toxic cough syrup mixed and distributed by the Social Security Fund, several members of that institution’s board were charged with a crime for alleged negligent oversight. They never allocated the funds out of the budget they got from the legislature for an adequate medicine testing system, but it was found by the ordinary courts that those facts did not support a conviction for hundreds of counts of negligent homicide. The case was prosecuted by the regular prosecutors at tried by a regular judge and the matter of only the Supreme Court’s Penal Bench having jurisdiction was never raised. Precedent doesn’t mean much in Panama’s legal system, but the weight of legal opinion here is that for purposes of Article 40 of the Code of Criminal Procedure “director” means the person with top administrative powers and not a member of a board of directors who has no executive duties. Constitutional law professor Miguel Antonio Bernal opines that the only one on the ACP board who has “authority and jurisdiction” is the minister of canal affairs.

In the years since the provisions found in Article 40 have been in effect, it would have been wiser in the drafting of laws creating state entities to use a word other than “director” for members of those institutions’ boards. Careless legal drafting, like falsified academic credentials, is one of the hallmarks of Panama’s political class. Sometimes confusion is actually what is intended.

The Panama Canal Authority has had problems with the canal expansion and may have more. It took a lowball bid from a consortium that includes a construction company owned for the then administrator’s family and is facing major money disputes that are in litigation or arbitration with that consortium. The authority is planning to expand into ports, oil pipeline and fossil fuel power plant businesses and some of the objections suggest conflicts of interest. A board packed with people from industries that have pecuniary interests in the canal and with old-school politicians does not escape critical mention. But polls indicate that most Panamanians give the ACP the benefit of the doubt.

Will that benefit of the doubt survive if the ACP board includes one of Martinelli’s insiders, an executive in an industry that would be favored if the ACP’s controversial plans to expand into other businesses proceed, about whom there is probable cause to investigate whether he’s a big-time crook but has gamed the system to block any investigation and to remain on the board?

Corcione may not get away with his legal ploy, but Bernal thinks that it will at least delay the proceedings against him. Other legal scholars have also opined in statements to other media that what Corcione is trying to do is legally flawed.

Bernal suggests a quicker way than endless litigation for the ACO to free itself from this Gordian Knot. “Corcione’s colleagues should vote to remove him from the board.” Can they do that? One might imply it from the powers enumerated in the Constitution, but unlike the power to remove the adminstrator it’s not something that’s explicitly granted. But the ACP board does have the power to set regulations in order to improve the authority’s functions and generally exercise all canal-related functions under the laws of Panama. So wouldn’t that give them to power to remove Corcione?

Think about it. If his colleagues kicked him out, Corcione might scream and yell and sue. To quickly set aside the action he’s have to file an ammparo de garantias with the Supreme Court, which would have to hold a summary hearing to decide if his case has enough merit to stay any action against him. But then he’d be rolling the dice with magistrates who are surely embarrassed by a corrupt scheme involving their institution, when he is alleged to have been a central player in that scheme. It would look terrible and could provoke a constitutional crisis if they ruled in favor of Corcione.

Other balls may be played in other courts. Attorney General Kenia Porcell could just order her prosecutors to proceed against Corcione as if he were a two-bit gangster from the slums, sending the police out to arrest him and bring him in for an indagatoria, at the end of which he would be ordered jailed pending trial as a scofflaw and flight risk charged with a serious crime.

The problem remains, for now. The Panama Canal Authority is under a cloud, with what appears to be a notorious scandal in its midst. The aura of patriotic pride in a canal taken over from the Americans and apparently well run and moving in a new direction may not shine so well through that sort of a cloud.


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