BOLIVIA: MURDER AND SCANDAL

UNCLAS LA PAZ 000156 SIPDIS E.O. 12958: N/A TAGS: PGOV PREL PINR ASEC BL SUBJECT: BOLIVIA: MURDER AND SCANDAL REF: 08 LA PAZ 2567 ¶1. Summary: Bolivian headlines announced "murder", "torture", and "conspiracy" in the days following a brutal murder and robbery which may have ties to powerful politicians. An investigation into the January 27 murder and theft of $450,000 has raised suspicions of corruption within the state hydrocarbons company YPFB. In the course of the robbery the president of a company contracting to YPFB was killed. Press reports suggest that the victim may be associated with the brother-in-law of YPFB President Santos Ramirez, who is close to President Evo Morales. The victim was also the nephew of an opposition PODEMOS Senator. If the stolen money was a kick-back to YPFB, as the press is alleging, the case could create another high-level corruption scandal for the Morales government, less than two months after powerful Presidency Minister Juan Ramon Quintana was accused of collusion with contraband smugglers (reftel). End summary. - - - - - - - - - - - - - - - - - One Man Dead, USD 450,000 Stolen - - - - - - - - - - - - - - - - - ¶2. According to public information, on January 27, Jorge O'CONNOR D'Arlach was killed and USD 450,000 in his possession was stolen. The amount of cash the victim was carrying immediately raised suspicions, particularly since O'Connor was the president of Catler Uniservice, a company which has dealings with the state hydrocarbons company YPFB: in July 2008, O'Connor signed a USD 66 million contract with YPFB President Santos Ramirez for the construction of a hydrocarbons liquid-to-gas plant. Police sources have told the press that they suspect the cash was a kick-back for the YPFB contract. - - - - - - - - - - - - - - - - - - - - - - Murder Investigation Proceeds With Caution - - - - - - - - - - - - - - - - - - - - - - ¶3. According to press reports, police sources and prosecutors are requesting anonymity in what is developing into a delicate case. One source reportedly said, "This is a very sensitive and dangerous case because it involves people with power." Unconfirmed press reports suggest that the house where the victim was taking the money belongs to the brother-in-law of YPFB President Santos Ramirez. The victim is also the nephew of opposition-party PODEMOS Senator Carlos Rodolfo D'ARLACH Lema (Tarija),who was formerly the president of YPFB. (Note: Tarija is a sparsely populated department (state) where many leaders are linked by complex familial ties. End note.) On January 29, the police announced that they had arrested three suspects who were carrying USD 50,000 in cash, USD 37,000 in bank "deposit" notes (receipts),and stolen license plates. - - - - - - - - - - - Senate to Investigate - - - - - - - - - - - ¶4. The (opposition-controlled) senate has announced that it will form a special commission to investigate possible linkages between the state hydrocarbons company YPFB and the crime. The senate will ask for testimony from the president of YPFB Santos Ramirez and Hydrocarbons Minister Saul AVALOS Cortez. - - - - - - - - - - - - - - - - - - - - Not the First Possible Corruption Case - - - - - - - - - - - - - - - - - - - - ¶5. In an unrelated and unsolved alleged corruption case, a former head of the Bolivian Customs Agency has accused Presidency Minister Quintana of negotiating with smugglers to allow contraband to exit the country in exchange for political support. On December 11, 2008, President Morales publicly supported Quintana, while acknowledging that he knew of Quintana's meetings with the smugglers. Even one of the smugglers called for Quintana's resignation: "For the dignity of this government, Quintana should come out and tell the truth. He should resign so that he does not damage the government, since we know that our President is honest." On January 18 President Morales was moved to re-establish public control over his most powerful minister, saying "Juan Ramon (Quintana) should be very afraid of the President." When asked about Quintana's alleged "dirty work", Morales answered: "I don't know about dirty work...I never have anything up my sleeve...as far as I know, no minister can dedicate himself to (dirty work)." LAMBERT