MP REQUESTS 10 YEARS IN PRISON FOR FORMER PRESIDENT PORTILLO

Guatemala, April 25, 2011. The Public Prosecutor's Office (MP) requested 10 years in prison on the charge of embezzlement for former President Alfonso Portillo and ex Ministers Manuel Hiram Maza Castellanos and Eduardo Arévalo Lacs. The trio are charged with misappropriating GTQ 120 million from the Ministry of National Defence in 2001.

During the final arguments of the trial of the three former public officials, the prosecutor, Eunice Mendizábal, gave details of how each of the accused individuals had been involved in the crime. "The actions of each of the three accused created the conditions to misappropriate GTQ 120 million from the Ministry of National Defence," she said.

The prosecutor said that Portillo had committed embezzlement by ordering Maza Castellanos to transfer GTQ 120 million, contravening the provisions of the Budget Adjustments Manual, which sets forth a series of requirements for such operations. The former President violated these requirements.

She said that Portillo showed a lack of integrity by authorizing the misappropriation of millions despite being aware of the fact that the State of Guatemala had pledged to reduce Army assets by 33% after the signing of the Peace Accords.

"He authorized the GTQ 120 million transfer to the MDN, by way of Government Decision 16-2001, and of this, he gave GTQ 30 million to José Armando Llort Quiteño (former President of the National Mortgage Credit Bank) for his own personal use. Portillo ordered that Jacobo Salán Sánchez and Napoleón Rojas (Portillo's former heads of security) deliver the money to Llort Quiteño, but later ordered that they recover it after certain problems arose."

The prosecutor also explained that Article 182 of the Constitution of the Republic sets forth that the President of the Republic is the Commander in Chief of the Army and is responsible for looking after the interests of the population. Therefore, Portillo was the maximum authority of the MDN and thereby responsible for the management of the funds of the Ministry.

The prosecutor said that Maza Castellanos had assisted in the crime by contributing to the authorization of a budget in excess of GTQ 1.8 billion. This authorization contravened the Peace Accords, which had provided for a reduction in Army assets. Maza Castellanos authorized five budget adjustments (including adjustment 16-2001, which provided for the withdrawal of GTQ 120 million) and delivered the funds to the MDN without authorization.

"In relation to these facts, Eduardo Arévalo Lacs committed embezzlement by countersigning Government Decision 16-2001 to transfer GTQ 120 million to the MDN. Furthermore, he ordered the withdrawal of the funds in cash and, as a result, Juan José de León Pineda (former head of the Financial Subdivision of the Finance Department of the Army) cashed in two cheques without having authorization to handle cash," she said.

Furthermore, she said that Arévalo Lacs had ordered the issuance of certificates as the sole documentation of the expense and ordered that the certificates be filed as confidential military documents backing the GTQ 120 million expense. This was the only ministry authorized to receive and handle cash, thus creating the conditions by which the money could be misappropriated and hidden.

The prosecutor presented all the documentary evidence, expert witness opinions and witness statements, which she believed demonstrated the criminal responsibility of former President Portillo and the two former ministers.

The final arguments of the complementary prosecutors will be heard tomorrow in these criminal proceedings against the three accused individuals.