Civil Court Absolves Ex-President Flores of Embezzlement, Returns Millions Stolen from Public Funds to Heirs

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On April 20, a civil court in El Salvador absolved the family of former President Francisco Flores (1999-2004) on a technicality in one of the most high-profile cases of corruption in the country’s recent history. Francisco Flores, from the right-wing Nationalist Republican Alliance (ARENA), was under house arrest and on trial for corruption and embezzlement when he suddenly died in 2016.

The decision to absolve Flores deals a major blow to efforts to hold ARENA party members and former public officials accountable for runaway impunity and suggests high-level corruption within El Salvador’s judicial system. The outcome also raises questions about current Attorney General Douglas Meléndez, who bungled the case on a technicality, which, according to progressive legal organization FESPAD, should have been easily avoided. Civil society organizations have repeatedly questioned Meléndez’ bias, pointing to hundreds of corruption cases implicating former ARENA government officials that the Attorney General has left untouched.

In 2001, El Salvador was struck by two powerful earthquakes that ravaged the country and left many dead in its wake. Though El Salvador received millions of dollars in international humanitarian relief funds, recovery was slow to non-existent. In 2013, President Mauricio Funes, the first President elected by the FMLN, went public with investigations being carried out by U.S. and Salvadoran officials against ex-President Flores regarding the embezzlement of millions of dollars in earthquake relief funds that had been donated by the government of Taiwan. Facing reluctance to prosecute from then- Attorney General Luis Martínez, the FMLN opened a special investigative commission in the Legislative Assembly that ultimately forced the hand of the Attorney General to freeze Flores’ assets and press charges. Flores was accused of personally embezzling $5 million dollars, while routing $10 million dollars to the ARENA party. During the case, Flores remained under house arrest but his death in 2016 ultimately stopped the process. For more background see this Special Report from CISPES.

In an effort to recuperate the stolen funds, the current Attorney General Douglas Meléndez pursued a civil case against the Flores family estate and last year seized a number of multi-million dollar properties owned by the family. However, on April 20, the civil court judge ruled that the evidence presented by the Attorney General’s office showing the money transfers had not been officially authenticated by the Exterior Relations Ministries of Taiwan or El Salvador and as a result did not meet the legal requirements to be presented and evidence. While the Attorney General's office has vowed to appeal the decision, this seemingly minor detail highlights the Attorney General’s negligence in prosecuting cases of high level corruption, especially when it involves ARENA members.

Notably, the same evidence had previously been used to successfully indict Flores, who confessed to moving money into ARENA’s accounts while denying the charges of personal embezzlement, on criminal charges in a higher level court. The details of the embezzlement had also been well-documented for years, both by a special legislative commission and by U.S. financial institutions such as the IRS.

Flores’ corruption has had a lasting impact. Much of the stolen money was directed into ARENA party campaigns and may even continue to finance right-wing candidates. For example, a groundbreaking report from the Secretary of Transparency regarding political party financing revealed the shadowy Rodriguez Porth Institute as one of ARENA’s largest campaign contributors. According to Margarita Posada, a leader in the Social Alliance for Governability and Justice (ASGOJU), “The recipients of the money are in ARENA, Francisco Flores’s son even said so. In all the bank transactions you can clearly see that the money was sent to the Rodriguez Porth Institute, then to Costa Rica, and then to the bank accounts of COENA (the leadership council of ARENA). So they’re the ones who should pay … and against whom the asset forfeiture law should be applied.”

Meléndez’ unwillingness to utilize other legal tools available, like the asset forfeiture law, to recuperate the other $10 million, has prompted outcry from popular movement organizations like ASGOJU, which reports that they filed five motions before his office requesting an investigation into ARENA’s finances, none of which have been pursued.

Failure of the court to rule against the Flores family, or at the very least recuperate the stolen funds, reinforces and enables the impunity that the Salvadoran ruling class has enjoyed for decades. As progressive legal and human rights organization FESPAD points out, the decision follows a familiar pattern, pointing to two other recent cases: that of Luis Mario Rodríguez, current president of right-wing think tank FUSADES and former Legislative and Judicial Affairs Secretary to president Saca, against whom the Supreme Court decided not to pursue charges of illicit enrichment, and that of the Record Battery company, which was recently sentenced to pay a mere $195 fine each for each of the 52 people, including children, who suffered lead poisoning so severe that their case went all the way to the Inter-American Human Rights Commission and the United Nations’ Human Rights Commission.

According to FESPAD, “These three cases show some common characteristics … The accused are prominent figures in the country. The legal processes have gone back and forth for many years. The accused have or have had formal and financial ties to the ARENA party. There were failures in the process, either administrative or judicial. And they were absolved.”

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