CONGRESS VOTES "NO CONFIDENCE" IN FINANCE MINISTER

C O N F I D E N T I A L QUITO 001607 SIPDIS SENSITIVE SIPDIS E.O. 12958: DECL: TEN YEARS TAGS: PGOV PREL EC SUBJECT: CONGRESS VOTES "NO CONFIDENCE" IN FINANCE MINISTER REF: QUITO 1182 Classified By: PolOff James Cohen for reasons 1.4 (b) and (d) ¶1. (SBU) Summary: Continuing the standoff between Congress and the Correa administration, Congress passed a vote of no confidence July 13 against Minister of Finance Ricardo Patino. Citing allegations of embezzlement, illicit association, collusion and treason, Congress passed the measure after Patino failed to appear before a Congressional hearing into the allegations, declaring the Minister "in rebellion" (in contempt of Congress). Since the vote of no confidence is non-binding, and President Correa has reiterated his confidence in Patino, the vote will have no immediate practical effect. But President of the Congress Jorge Cevallos announced his intention to transfer the charges to the Office of the Attorney General for investigation, keeping the matter in the spotlight. End Summary. NO SHOW, NO CONFIDENCE -------------- ¶2. (SBU) By a margin of 66 to 34, Congress passed a vote of no confidence against Minister of Finance Ricardo Patino July ¶13. The proceedings began with a vote to declare Patino in "rebellion," since he did not appear before Congress as requested. With that procedure out of the way, the no confidence debate was led by Luis Almeida (PSP - Partido Sociedad Patriotica) and Diego Ordonez (UDC - Union of Christian Democrats). Both deputies highlighted Patino's perceived complicity in the recent scandal involving possible manipulation of the international bond market (reftel). Additionally, they accused Patino of mishandling foreign debt, misappropriating public funds, violating two articles of the Law on Fiscal Transparency and lying about his economic expertise and qualifications. They produced documents to suggest that he did not graduate with an economics degree as cited on his curriculum vitae. Most center-right deputies voted in favor of the no confidence measure. While Pachakutik, small leftist parties and some members of the National Dignity Bloc voted against the measure, no deputies came to Patino's defense rhetorically. EXECUTIVE BRANCH STANDS FIRM AS FIGHT CONTINUES -------------- -- ¶3. (SBU) Patino refused to appear before Congress to defend himself, telling supporters outside the Congress building that Congress was corrupt and out for blood, then retreating to his office. President Correa vowed to stand by his Finance Minister and expressed total confidence in him. Speaking from Italy, Correa noted in his weekly radio address in regards to the Patino matter, "Today, more than ever, Congress is corrupt and has no credibility." ¶4. (SBU) Under the 1998 Constitution, the no confidence vote is non-binding and has no force of law. In order to continue the case against Patino, President of Congress Cevallos announced July 14 that he intends to request that the charges against Patino be investigated by the Attorney General. Many deputies in the Congress, led by John Argudo (ID),support the notion of criminal proceedings against Patino, not only because a conviction would force him from office, but also because, in their view, Patino committed felonies. COMMENT -------------- ¶5. (C) As the Constituent Assembly election campaign approaches, Correa's opponents will not let go of the Patino issue. Knowing that Congress has the lowest approval rating of any government institution, Cevallos is banking on an independent investigation to keep the issue alive in the media. Embassy contacts at the Supreme Electoral Tribunal have privately told us that they fear there is more dirt on Patino and that his opponents will dole it out piecemeal to embarrass Correa closer to the September 30 Constituent Assembly election. The fact that deputies included in their attack accusations that Patino lied on his resume indicates that they will dig up whatever they can to turn this into a political advantage. JEWELL