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Presidents' Offspring in the Shadow of Corruption
Diego Cevallos

MEXICO CITY, Feb 1 (IPS) - Suspicions of corruption are hanging over the grown children of the presidents of Brazil and Mexico, of former leaders of Peru and Argentina, and of former Chilean dictator Augusto Pinochet - just another symptom of the deep-rooted graft faced by many Latin American nations, according to analysts.

"Anti-corruption laws in Latin America are generally vague when it comes to dealing with the relatives of those who hold power in the state, and this translates into an incentive for committing irregularities," Arturo del Castillo, director of CIE Consulting & Research, a private Mexican firm that specialises in the fight against corruption, told IPS.

"And while there are no clear laws for combating corruption among the family members of presidents, there is a very strong unwritten law that states that it is best not to mess with them," he said.

A Mexican congressional commission issued a report Tuesday recommending an in-depth investigation into the newfound wealth of one of President Vicente Fox's stepsons, who in the past five years left his middle-class lifestyle behind to emerge as a wealthy figure in the real estate market. (Fox took office in December 2000).

Trafficking of influences, the obtaining of loans from public entities, the disappearance of key public documents that would prove the existence of irregularities, and unusual support from government officials all form part of the suspicions and accusations against Manuel Bribiesca, the son of Marta Sahagún, Fox's second wife.

Another case in the region involves the son of Brazilian President Luiz Inácio Lula da Silva. In January, the local press in Brazil reported on how quickly 30-year-old Fabio Lula da Silva had become a wealthy man.

The media reports, published by Veja, a prestigious weekly publication; Época, another local magazine; and the newspaper Jornal do Brasilia, noted that the Brazilian leader's son, formerly an English and computer teacher with a modest lifestyle, founded three video game businesses in 2003, apparently with suspicious financing.

The capital used to set up the businesses came from the Telemar phone company, whose shareholders include the state-owned National Development Bank, which owns a 25 percent stake, and pension funds of public enterprises, which own 19 percent of the shares.

The swift change in the economic position of Lula's son since the president took office in January 2003 has added fuel to the fire in the corruption scandal that the ruling leftist Workers' Party has faced since last year, involving bribes paid to lawmakers from allied parties to win support for government-sponsored legislation.

"There are many cases where wily families take advantage of a president's power," said Óscar Ugarteche, who helped the Peruvian Congress investigate corruption in public finances on the part of former president Alberto Fujimori (1990-2000).

Ugarteche told IPS that in the processes of deregulation and privatisation of a number of economies in Latin America, governments received large revenues, which they tended to administer with little regulation and oversight, thus encouraging the diversion of funds and other kinds of corruption.

A not insignificant part of the new inflow of revenues reached the relatives of presidents through different channels, and - "since ethics matters very little in politics" - were used with absolute discretion, said Ugarteche, who has been living in Mexico for the past year, where he teaches and does research at the National Autonomous University of Mexico.

In his view, the form that corruption has apparently taken among the children of presidents and former presidents is new. "In the past, graft basically consisted of taking money from a state account, whereas now it involves taking advantage of a position of power to obtain benefits linked to the trafficking of influences," said the expert.

In Peru, Fujimori's daughter Keiko was accused in 2004 of mishandling donations from a U.S. charity while acting as first lady during her father's administration. (The former Peruvian president himself is currently in custody in Chile awaiting extradition to Peru on multiple charges of corruption and human rights abuses).

Another case is that of the family of former Chilean dictator General Augusto Pinochet (1973-1990). On Monday, the Santiago appeals court released Pinochet's oldest daughter LucÃ*a on bail in a case involving tax evasion. She had been arrested after she returned to Chile and withdrew a request for political asylum in the United States.

LucÃ*a, three of her siblings, and her mother and father are all facing charges for tax fraud and evasion.

In Argentina, a shadow also hangs over Zulema Menem, the daughter of ex-president Carlos Menem (1989-1999). The former president opened secret bank accounts holding millions of dollars in Switzerland, in her name.

"The cases of corruption involving the family members of presidents or former heads of state are just one more symptom of the grave problems of corruption in Latin America," said CIE Consulting & Research's del Castillo.

With respect to presidents' responsibility regarding the actions of their family members, the expert said they have a moral responsibility that, if they fail to assume it, directly taints the heads of state themselves.

On the global anti-corruption watchdog Transparency International's 2005 corruption perception index, which classifies countries on a scale of zero (absolute corruption) to 10 (squeaky clean), the "healthiest" countries in Latin America are Chile, which was given a score of 7.3, and Uruguay, with a score of 5.9.

The rest of the countries in the region were rated 4.2 or lower, with Haiti tailing the list with a score of 1.8.

The index, which is released every year by the Germany-based Transparency International, is based on surveys among business, analysts and students. (END/2006)