Friday, October 23, 2020

Former Pemex boss accused Mexico’s ex-president Nieto of corruption


The former head of Mexico’s state-oil company Petróleos Mexicanos (Pemex) accused former president Enrique Peña Nieto and his former finance minister of instructing him to funnel millions of dollars in bribes to the 2012 presidential campaign, part of Mexico’s highest-profile corruption probe in decades, the country’s Attorney General said Tuesday.

Emilio Lozoya, who is also facing corruption charges, filed a complaint against Mr. Peña Nieto and former Finance Minister Luis Videgaray for allegedly ordering him to illegally finance Mr. Peña Nieto’s campaign and bribe legislators to secure passage of sweeping overhauls, including the opening of the energy industry to private investment, Attorney General Alejandro Gertz said in a video statement.

Mr. Lozoya said bribes of more than 100 million pesos, or $7.5 million at the time, from Brazilian construction giant Odebrecht SA were diverted to Mr. Peña Nieto’s campaign, according to a summary of the complaint provided by the attorney general. Another 120 million pesos was funneled to bribe legislators in 2013 and 2014.

Mr. Gertz said Mr. Lozoya has given prosecutors witnesses, receipts and a video. The former Pemex chief was extradited from Spain in July after spending months in prison.

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Mexico’s attorney general said his office was opening an investigation to determine whether the evidence is solid and may call Mssrs. Peña Nieto and Videgaray to testify. They haven’t been charged with any crime.

Mr. Peña Nieto couldn’t be immediately reached for comment. Mr. Videgaray didn’t reply to a call seeking comment at his office in the Massachusetts Institute of Technology, where he is serving as senior lecturer at the MIT Sloan School of Management.

Mr. Lozoya’s allegations are part of the highest-profile corruption case since 1983, when another former Pemex chief was jailed for corruption. If Mr. Peña Nieto were indicted, he would be the first president to face corruption charges in Mexico’s modern history.

An investigation against Mr. Peña Nieto could be a boon for President Andrés Manuel López Obrador, a nationalist who came to power in 2018 promising to stamp out corruption.

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But observers have expressed doubts that the Attorney General’s office, which is on paper autonomous from the president, would be impartial just 10 months before midterm elections.

“This is more a political show than anything else. It’s going to be difficult to demonstrate the former president’s involvement,” said Alejandro Schtulmann, director of risk consulting firm Empra. Lawyers say that the statute of limitations has expired for illegal campaign financing in 2012.

Mr. Lozoya, who led Pemex from 2012 to 2016 and was a close aide to Mr. Peña Nieto, has been charged with money laundering, bribery and racketeering in two cases. He was hospitalized upon arrival to recover from anemia, the Attorney General’s office said. He was later released by a judge, who ordered him to wear an ankle monitor. Mr. Lozoya has denied wrongdoing.

His offer of evidence allegedly involving Mr. Peña Nieto and Mr. Videgaray is part of a a negotiation to secure a plea bargain, according to people familiar with the case.

The first probe against Mr. Lozoya relates to the alleged payment of bribes by Brazil’s Odebrecht in exchange for government contracts, prosecutors say. Some of the money was allegedly received when Mr. Lozoya served as international affairs chief of Mr. Peña Nieto’s presidential campaign and part after he was named Pemex chief executive.

Several former Odebrecht executives have told Brazilian prosecutors under oath that to secure Mexican government contracts for their firm, they paid $10 million in bribes to Mr. Lozoya while he was a top aide of Mr. Peña Nieto.

As part of a plea bargain with U.S. authorities in 2016, Odebrecht admitted to bribing governments across Latin America and elsewhere in exchange for contracts. Odebrecht officials couldn’t be reached for comment at the company’s Mexico City offices.

The second inquiry relates to the 2013 sale of a fertilizer plant by steelmaker Ahmsa to Pemex for about $273 million. Mexican authorities say the plant was worth only about $50 million. Prosecutors say that Ahmsa funneled some $3.5 million to Mr. Lozoya.

Ahmsa’s chairman, Alonso Ancira, was arrested in Spain last year and is expected to be extradited to Mexico soon. Ahmsa has denied any wrongdoing by its chairman or the company.

Prosecutors say that Mr. Lozoya bought two mansions with proceeds from the bribes, one in a luxury neighborhood in Mexico City and another in the Pacific beach resort of Ixtapa.

Mr. Peña Nieto governed from 2012 to 2018. During his tenure, he shepherded in congress a historic package of overhauls that sought to increase competition in sectors of the economy from education and telecommunications to energy. Under the 2013 energy changes, private firms could explore and produce oil in Mexico for the first time in nearly 80 years.

Mr. Peña Nieto’s party lost convincingly at the hands of Mr. López Obrador in the 2018 election. Now the changes, analysts say, may be compromised if the investigations reveal that they were passed in part thanks to bribes. Mr. López Obrador has effectively overturned the energy reform, not awarding any contract to private investors, and has said he could send a bill to formally abrogate it after midterm elections.

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