Caribbean & Central America - February 2018 (ISSN 1741-4458)

Kenia Porcell, Panama’s attorney general, has revealed details of a new corruption scandal involving local construction companies; but some campaigners still accuse her of taking a “selective” approach to prosecuting wrong-doers.

The latest corruption scheme, code-named ‘Blue Apple’ by prosecutors, is similar, but on a smaller scale, to the scandal that blew up around Odebrecht, the Brazilian construction company which paid bribes in many Latin American countries, including Panama. Porcell said the new scandal involved a group of local construction companies that were paying bribes equivalent to 5%-10% on top of the value of commissioned work, as a way of securing big government contracts, and a guarantee of speedy payments, from the ministry of public works and housing in 2011-2012. Prosecutors were investigating 33 persons of interest. Seven construction companies had been involved. The total value of the bribes was around US$40m; the illicit payments were made through a paper company called Blue Apple Services (hence the name of the investigation). The authorities had recovered some US$20m of the bribes paid and a further US$5m-worth of assets had been confiscated.

Reaction to the news was mixed. Annette Planells, leader of anti-corruption lobby group Movin (Movimiento Independiente), said this was an important and positive development. Economist Rolando Gordón of Universidad de Panama said it this was the first time kickbacks in public works, which had been endemic since the 1970s, were being properly addressed. But Ernesto Cedeño, a lawyer, said that as in the Odebrecht case, Porcell was limiting the investigation to wrong-doing under the previous government of President Ricardo Martinelli (2009-2014), and not following up evidence pointing to involvement by officials in both the preceding and the current administration of President Juan Carlos Varela. Other campaigners also complain that despite leaks, many of the names of the accused in both the Odebrecht and Blue Apple cases remain under wraps.