Latinnews Archive
Brazil and Southern Cone - 6 February 1992
Menem reacts to corruption claims; MORE TO 'SMEAR CAMPAIGN' AS OFFICIALS FORCED TO RESIGN
With his government engulfed by a wave of corruption allegations, in mid-January President Carlos Menem said he would defend 'the good name' of government officials facing unfounded accusations and instructed law officers to take legal action against those making such accusations (the law actually places officials under the obligation, largely unobserved, to sue whenever allegations of impropriety are made).
On 8 January Menem had publicly claimed that the allegations were part of a smear campaign, inspired by the opposition Union Civica Radical (UCR), aimed at discrediting the government. He also blamed the press, singling out the Buenos Aires daily Clarin newspaper for publishing 'biased comment'.
Government officials pointed fingers at other 'villains'. Interior minister Jose Luis Manzano suggested to journalists that businessman Ghaith Pharaon, of BCCI renown, was behind the smear campaign. Manzano later backed the suggestion made by Eduardo Bauza, the President's chief-of-staff, that the campaign was part of a 'war of attrition' being conducted by Argentina's creditor banks in an effort to weaken the government's hand in forthcoming debt negotiations (see Page 7).
But while still claiming that there is 'a sort of campaign' against the government, in mid-January Menem acknowledged that not all the allegations were unfounded in ordering the attorney-general, Aldo Montesano Rebon, to speed up corruption cases involving officials and former officials of his government.
* Scandals galore
Accusations of corruption in high places are not new to the Menem government, which was shaken by a series of scandals in 1991.
One of the most notable was the early-year Swift-Armour bribery cased, raised by US ambassador Terence Todman, that led to the resignation of Menem's economic adviser and brother-in-law Emir Yoma and to a cabinet reshuffle (RS-91-01). Another was the 'Yomagate' money-laundering affair, which led to court proceedings against Menem's appointments secretary and sister-in-law Amira Yoma, her former husband Ibrahim al-Ibrahim, the customs director at Ezeiza airport, and the secretary of the federal water and sanitation council, Mario Caserta, all of whom were forced to resign (RS-91-04).
* Somisa boss goes
The latest wave of allegations of corruption followed the government's late-December announcement that it had accepted the resignation of Jorge Triaca, the former labour minister who had been dropped from the cabinet in the January 1991 reshuffle and who was later entrusted with slimming down the state steel company Somisa in preparation for its privatisation.
A judge had ordered proceedings against Triaca over alleged irregularities in the purchase of new headquarters for Somisa, for which the price paid was reportedly 80% higher than what almost identical adjoining premises had recently fetched. The magistrate investigating the deal said some documents suggested that officials acting under Triaca's instructions may have received illegal 'commissions'.
As Triaca submitted his resignation, ostensibly to 'facilitate the investigation', the chamber of metallurgic industries went to court, claiming that Somisa had sold some 20m tonnes of cold-rolled steel to two companies, Ferrosider and Sidersa, at lower-than-market prices.
Triaca was replaced by Maria Julia Alsogaray, the recently appointed secretary of natural resources and the environment -- herself out on US$ 10,000 bail while awaiting court proceedings on charges of irregularities in the privatisation of the state telephone company, Entel.
* Resignations multiply
Soon after Triaca's resignation came another, with presidential adviser Carlos Spadona quitting as a result of earlier charges of involvement in the sale to the government of powered milk unfit for human consumption, which was to be distributed among the poor.
The operation was carried out by a distribution company run by Spadona, although it was alleged that its true owner was Menem's personal secretary Miguel Angel Vicco, a businessman with interests in the dairy industry. Reportedly at the request of interior minister Jose Luis Manzano, Menem finally dismissed Vicco in mid-January.
Manzano's deputy Juan Carlos Mazzon has also lost his job, being dismissed after the magazine Noticias revealed that he had served nine months of a three-year prison sentence for fraud, passed by a court in the province of Mendoza.
Manzano himself has become a target. Opposition congressman Juan Pablo Baylac has said he will take to the courts charges of irregularities in government contracts, since put in abeyance, for compressed gas plants. Baylac has claimed that Manzano, the dismissed Vicco, and the president of the Justicialista (Peronist) party, Roberto Garcia, are involved.
* Inherited problem
While forced to acknowledge that allegations of corruption are not merely part of a campaign to undermine his government, Menem has insisted that the problem has its roots in the past UCR administration, headed by Raul Alfonsin. The President, who in early 1991 said he would leave no stone unturned in rooting out corruption (RS-91-04), has noted that he 'inherited a country which was corrupt through and through' and in which 'everybody broke the law', be it by evading taxes or by involvement with 'contraband,' thanks to the 'passivity' of the authorities.
Backing up Menem's claim that corruption has been around for a long time, the Peronist governor of Buenos Aires, Eduardo Duhalde, has said he has unearthed evidence of corruption dating back 10 years. As an example, he has noted that the provincial government is having to pay out 'three or four salaries' for each teacher on its payroll, adding that this 'cannot continue'.
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