DOMINICANS FIGHT CORRUPTION - MUCH BARK, LITTLE BITE, SHOOTING SNAFU WITH JUSTICE OFFICIALS

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PP RUEHWEB

DE RUEHDG #0028/01 0081116
ZNY CCCCC ZZH
P 081116Z JAN 07
FM AMEMBASSY SANTO DOMINGO
TO RUEHC/SECSTATE WASHDC PRIORITY 7062
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE PRIORITY
RUEHPU/AMEMBASSY PORT AU PRINCE PRIORITY 4436
RUEAWJA/DEPT OF JUSTICE WASHDC PRIORITY
RUCOWCV/CUSTOMS CARIBBEAN ATTACHE MIAMI FL PRIORITY
RHMCSUU/FBI WASHINGTON DC PRIORITY
RUEAHLC/HOMELAND SECURITY CENTER WASHINGTON DC PRIORITY
RUEFHLC/HQS DHS WASHDC PRIORITY
RUMISTA/CDR USSOUTHCOM MIAMI FL PRIORITY

C O N F I D E N T I A L SANTO DOMINGO 000028 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR WHA/CAR (SEARBY),WHA/EPSC (KUBISKE),INL; 
SOUTHCOM ALSO FOR POLAD 
 
E.O. 12958: DECL: 12/15/2016 
TAGS: PGOV, KCOR, KCRM, KJUS, DR 
SUBJECT: DOMINICANS FIGHT CORRUPTION - MUCH BARK, LITTLE 
BITE, SHOOTING SNAFU WITH JUSTICE OFFICIALS 
 
 
Classified By: Political Officer Michael Garuckis. Reasons: 1.4 (B) AN 
D (D) 
 

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losing its authority."



4. (C) Despite significant new legislation designed to fight

corruption, the overall situation did not improve in 2006 and

despite USG assistance is not likely to improve rapidly. The

overwhelming attitude of the general populace is tolerance

toward corrupt practices, the executive branch lacks the will

to pursue corruption, and the judiciary has failed to impose

deterrent sentences.



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Legislative Progress

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5. (U) In February 2006 President Fernandez finally issued a

"bridge decree," requiring public solicitation of bids for

government purchases of goods, services and construction. The

decree entered into force on June 1. It contained numerous

limitations and escape clauses, including subject matter

exemptions (i.e., social programs, poverty alleviation, and

programs dealing with "women, the disabled, children or

adolescents facing scare resources"). The ceilings on

amounts subject to its provisions were high. The decree

remained in effect until August 18, 2006, when it was

supplanted by generally satisfactory legislation addressing

these issues. The entry into force of the regional trade

agreement with the United States (DR-CAFTA) brings additional

credibility to the government procurement statutes and to the

criminalization of bribery in trade matters.



6. (SBU) At issue will be the implementation and use of these

new instruments. On November 29 former Attorney General and

current Senator for Santiago Francisco Dominguez Brito

commented publicly on the most recent non-CAFTA-related

anti-corruption legislation to pass through the Dominican

Congress, the 2004 Freedom of Information Act (Ley General de

Libre Acesso a la Informacion Publica). Dominguez Brito,

considered both by the Embassy and by the general public to



be an honest, engaged public official, dismissed the

legislation as ineffective because of lack of implementation.

Dominican wags hearing this remark suggested that the

Dominican national character simply lacked the concepts of

personal responsibility necessary for effective

implementation - - "it's easy to pass legislation."



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Society's Acceptance

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7. (SBU) Ratifying this view is a 2005 poll conducted by the

Pontifical Catholic University (PUCMM). The PUCMM study,

co-sponsored by USAID and released this December 7, is the

first formal discussion of "petty" corruption in the

Dominican Republic in the last 5 years and the first to

examine the subject extensively. Its principal findings

confirm empirically that corruption is both widespread and

culturally accepted in the Dominican Republic.



These findings include:



-- 82 percent of those polled find corruption to be at least

somewhat tolerable



-- 13 percent of all respondents have paid bribes to

government officials, principally in the areas of health care

and justice, and the majority of those paying bribes (55

percent) either approve of the practice or recognize it as

"wrong," but "justified."



-- 67 percent of all respondents would suggest to their

friends and family the payment of a bribe to speed

administrative processes



-- Only 3 percent of those solicited for bribes report the

solicitation. Of those not reporting, over half state that

it would be "a waste of time" or that it "wouldn't matter."





8. (C) Why wouldn't reporting solicitation of bribes

"matter"? The Embassy finds the shape of the answer in a

review of judicial actions resolved during 2006, as well as

those actions currently pending (paras 12-14 below). Bluntly

put, the review suggests that Fernandez administration tends

to punish corruption as part of a partisan political agenda,

rather than as an overall curative. The only notable

exception to this tendency are the enforcement actions

targeted against evasion of taxes and customs, led by

Internal Revenue Head Juan Hernandez and by Customs Director

General Miguel Cocco.



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Judicial Enforcement Gone Wrong

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9. (U) On November 23 the single vigorous effort by Justice

Ministry officials to arrest one of their own turned into a

disaster that resulted in the shooting death of the suspect,

one uniformed officer wounded, the suspension of two honest

and competent deputy attorneys general, and the demotion of

the number two official at the ministry.



10. (U) After receipt of several complaints in late 2005,

Deputy attorneys general Bolivar Sanchez and Frank Soto

obtained wiretaps and instituted surveillance of regional

Prosecutor for Puerto Plata Dr. Teodoro Ceballos Penalo.

These not only confirmed that Ceballos was extorting money

and otherwise abusing his office but revealed that he was

commissioning an imminent murder of a resident Italian

couple. Sanchez and Soto arrived in the northern city at

about noon to obtain a judicial warrant for arrest and

organize his capture in the town of Sosua, some twenty miles

distant. Delays were such that they had to obtain a revised

warrant authorizing action at night. They obtained

permission to proceed from Rodolfo Espiniera, acting Attorney

General in the absence from the country of Atty Gen Jimenez,

then set out to Sosua at about 8 PM, where Ceballos was

dining with friends in a restaurant. In route in a four-car

caravan they recognized Ceballos in a white pick-up coming

the other way; the arrest team turned to follow him. Soto



instructed an officer to call Ceballos on his cell phone to

warn him not to resist arrest, but the call failed because of

poor regional coverage. When the senior uniformed officer

pulled ahead of Ceballos and blocked his route, a uniformed

drug enforcement officer approached the car. Ceballos,

evidently expecting an assassination attempt, opened fire

with a pistol, wounding the arresting officer in the leg and

getting off five shots before vigorous return fire silenced

him. A female passenger was unhurt. The team took Ceballos

to emergency services in Puerto Plata and he was transferred

to Santiago but died shortly afterwards of a head wound.



11. (SBU) Attorney General Jimenez commissioned an

investigation. The three-person team coordinated by Gisela

Cueto delivered its report December 30, confirming the strong

evidence against Ceballos Penalo. The members advised

renewing vigilance over activities of prosecutors and

strengthening technical capabilities in evidence handling and

crime scene investigation. They recommended a judicial

inquiry against the uniformed officer whose automatic weapon

killed Ceballos -- largely because the officer denied having

pulled the trigger. The two assistant attorneys general were

suspended and referred for disciplinary review within the

ministry. And the following week the Attorney General moved

Rodolfo Espiniera from the number two position to a routine

administrative post.The lurid story of judicial enforcement

gone wrong, worthy of a James Ellroy novel, is being

published serial form in HOY newspaper, via installments of

the full text of the commission's account, complete with

verbatim interviews and a diary of its contacts and

activities.



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A PARTIAL LIST OF RESOLVED AND PENDING CASES AGAINST FIGURES

OUTSIDE THE FERNANDEZ ADMINISTRATION

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12. (SBU) There is no lack of judicial casework on

corruption, but there has been little forward movement in

them. These include:



-- Charges for money laundering brought and currently

pending against Pedro "Pepe" Julio Goico Guerrero (head of

presidential advance under the former administration of

Hipoligo Mejia).



-- Formal investigation begun of Milagros Ortiz Bosch

(Secretary of Education and Vice President. under Mejia and

current PRD presidential pre-candidate) for possible theft

from financing for school lunch program during her tenure, as

well as other management "irregularities" totaling over 1

million USD in current dollars.



-- Convictions obtained for fraud and embezzlement in the

Plan RENOVE scandal (involving the over-priced purchase of

public transport vehicles during the Mejia administration).

Results of Supreme Court review are expected soon. Convicted

were:



1) Pedro Franco Badia (former Minister of the Interior and

ex-president of RENOVE -- 3 years house arrest and fine of 15

million pesos);

2) Casimiro Antonio Marte (president of transport union

CONATRA -- 3 years prison);

3) Milciades Amaro Guzman (3 years in prison and a fine of 5

million pesos);

4) Fabio Ruiz Rosado (4 years in prison and a fine of 10

million pesos);

5) Antonio Perez (6 months house arrest);

6) Gervasio de la Rosa (2 years in prison);

7) Paulino Antonio Reinoso (2 months house arrest);

8) Alfredo Pulinario Linares (six months house arrest);

9) Freddy Mendez Monres de Oca (six months house arrest); and

10) Blas Peralta (president of the National Federation of

Dominican Transport (FENATRADO) -- six months in prison and

fine of 2 million pesos)



-- Case pending against Victor Cespedes Martinez (Attorney

General under Mejia) for bribery, prevarication (representing



another's interest while public official),criminal

association, and fraud. He allegedly promised inmates

presidential pardons in exchange for money or sexual favors.

Several inmates allegedly paid between 250,000 and 500,000

pesos to Cespedes. (This Embassy obtained Department

authorization to revoke his U.S. visa.) In addition,

Cespedes was found not guilty of malfeasance for paying from

official funds a large supplementary honorarium to a staff

member defending government actions in another case.



-- Conviction obtained for Mejia-era administrator of

National Real Property, Victor Tio and 4 others. They were

sentenced to between one and two years in prison after being

found guilty of fraud in the improper transfer of state

property (totaling 3381 sq. meters). Four others were found

not guilty. Prosecutor German Miranda Villalona had sought

maximum sentences of 5 years for Tio and 3 years for 2 others.



-- Case pending against Cesar Sanchez Torres, administrator

for the Mejia administration of the Corporation of State

Electric Companies (CDEEE). Sanchez is accused of a 2002

fraud involving more than 2 billion pesos (USD 60 million

current, USD 115 million in 2002) of government bonds.

Specific charges include prevarication, fraud, violation of

Law 128-01 (concerning government bonds) and violation of

Article 102 of the Constitution. Proceeds of sale of

government bonds totaling 2,019,400,000 pesos were directed

to CDEEE for the construction of a 345 kilovolt transmission

system between Santo Domingo and Santiago. The system was

never built and Law 128-01 required that the funds be used

for only the designated purpose. Additionally, "grave

irregularities that constitute fraudulent attempts to hide

the criminal activity" are alleged. Sanchez purportedly

tried to use documents regarding a second bond issue to show

payment on the first.



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A PARTIAL LIST OF RESOLVED AND PENDING CASES AGAINST FIGURES

WITHIN THE FERNANDEZ ADMINISTRATION

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-- Conviction obtained against Yorman R. Solano Vazquez, the

Fernandez administration's executive technical director for

coordinating special development zones for the border region.

He was accused of soliciting bribes to arrange for the

irregular shipment of six containers of merchandise through

Caucedo Multimodal Port, asserting that he had authorization

of Customs Director General Miguel Cocco. Convicted on July

1, 2006, of violating Articles 166 (prevaricacion) 174

(collusion while public official),175 (illegal compensation

for official actions),and 177 (accepting bribes) of the

Criminal Code. Sentenced to 3 years in prison and 100,000

peso fine.



-- Case pending against Marino Manuel Guichardo Pena, former

assistant director of analysis for the Office of the

Comptroller General. He is accused of favoring institutions

from which he received "commissions" (i.e., bribes).

Specifically, he required and accepted bribes from persons,

businesses, and contractors offering services to the State.



-- Case pending against Felix Alberto Alcantara Lugo

(ex-President of the Committee for Reform of Government

Agencies (CREP)) for prevarication and embezzlement. He is

accused of mishandling 27 million pesos of public funds.

Among the evidence implicating him in criminal activity is a

check for USD 77,000 written in October of 2004 to

Consolidated Aircraft Corporation and, in September of 2004,

a check for RD pesos 6 million in favor of Alcantara's

chauffeur Rafael Adams. Alcantara is also accused of

fraudulently participating in above-market-value purchases of

computer software, a Toyota Land Cruiser and three Isuzu

trucks in 2005.



Still, governmental advocacy against party stalwarts appears

imperfect.



-- The Santo Domingo district court has delayed for a month

until February 8 a hearing on the PEME case. The Fernandez



administration declines to sustain an appeal (first made

under the Mejia administration) against dismissal of charges

against 4 senior PLD officials Simon Lizardo, Haivanjo Ng

Cortinas, Luis Inchausti and Diandino Pena (and 4 others)

accused of embezzling roughly USD 43 million (1999

equivalent) from the now defunct PEME (Temporary and Minimal

Employment Fund) during the first Fernandez administration.

All except Inchausti are serving in the current Fernandez

administration: Lizardo is Comptroller, as before; Ng is

Superintendent of the Securities Commission; and Diandino

Pena is the commissioner in charge of getting the President's

Metro line built. The Ambassador cited this five-year-old

case in his November 22 speech as an example of the failure

of the judicial system to investigate: "Either the charges

were unfounded, or those accused are benefiting from

traditional Dominican impunity. The people do not know. And

they will probably never know."



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Non-Judicial Enforcement

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13. (SBU) In terms of fighting corruption within the police,

armed forces, and judiciary, the government's track record is

rather worse. Rather than resort to judicial sanctions, the

authorities apply weak, non-judicial sanctions. This

typically means termination of employment. In the most

notable instances:



-- 16 judges were terminated this year through an internal

judiciary review process for issuing sentences "favorable" to

narcotics traffickers (assumedly as a result of corruption),

but no criminal investigation/prosecution is anticipated.



-- The Armed Forces have likewise terminated 15 members (rank

of lieutenant colonel and below) for a variety of offenses,

at least 8 of whom were dismissed for classic

misappropriation or "money changing hands" corruption-type

offenses. None of these members currently faces civilian

justice to our knowledge and none will face military justice

(save dishonorable discharge or forced retirement).

According to a Dominican Army JAG officer, the maximum

punishment under the Armed Forces, Organic Law is

dishonorable discharge; additional punishment must come from

civilian authorities in civilian courts.



-- The National Drug Control Directorate (DNCD) terminates

employment in lieu of prosecution, and has fired more than

600 officers since August 16, 2006, for an ill-defined mix of

"incompetence" and "criminality," likely to include what we

would consider to be corruption-related offenses.



14. (SBU) An alternative manner of dealing with corruption,

or perhaps the threat of corruption, is reassignment. An

example of this practice is the mass reassignment of DNCD

officers, most recently in Puerto Plata and Sosua.

Government officials invariably describe the reassignments as

"normal procedure."





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Conclusion

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15. (C) While the impact of corruption is more than ever in

the thoughts of the Dominican populace, little real progress

in the fight against corruption has occurred. The culture of

impunity is weakening but the prospect of effective

punishment has not gotten much closer. The current political

leaders of the Fernandez administration, with the honorable

exceptions of the heads of Internal Revenue and Customs, have

done little to convince the public or the corrupt that they

mean business. A change in this behavior is unlikely, given

the beginning of campaigning within the parties and between

the parties for the 2008 presidential election.

HERTELL