Guatemala: More Reasons for High Geographic Risk
In terms of geographic risk for financial crimes like fraud and money laundering, Guatemala has raised red flags for decades. And that has been especially true among government officials there. But growing protests by citizens have pressed for prosecution of corrupt officials and businesses, and they may be making headway. But that headway has helped ignite a political crisis tied to financial crimes.
Guatemalan president Otto Perez Molina resigned late yesterday, the same day that a judge issued a warrant for his arrest. On Tuesday, the congress of Guatemala stripped Perez Molina from immunity from prosecution. Perez Molina faces extensive charges for fraud and corruption related to a bribery scheme in which government officials allegedly receive kickbacks in exchange for tariff reductions on imports. Perez Molina’s former vice president has already been jailed for charges of financial crimes, and she is currently awaiting trial.
Guatemala in recent decades has been rocked by civil war and by an infiltration of criminals and criminal organizations into the nation’s government and businesses. Former president Alfonso Portillo, for example, was arrested in 2010 on charges of embezzlement as he was preparing to flee the country. Portillo was not convicted of alleged crimes in Guatemala. However, he was eventually extradited to the U.S. where he pled guilty to charges of laundering illicit funds through banks in Florida. He was released from U.S. custody earlier this year.
A Wall Street Journal analysis in April of this year warned of growing unrest in Guatemala due to corruption, financial crimes, and to the fomenting of public dissatisfaction by political activists who would benefit from public exasperation with endless corruption.
Investigations and prosecutions have gained greater traction recently due to the support of the United Nations in the form of international prosecutors assisting the efforts of Guatemala’s attorney general’s office. And while many hail the events this week as progress in the fight against corruption, these events have added to the confusion about the presidential election scheduled for Sunday, an election in which the leading candidates are considered by many to be tainted by the perceived culture of corruption and financial crimes in the halls of power in Guatemala.
Mitigating Geographic Risk
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