On Wednesday the U.S. State Department sanctioned 39 public officials, judges, prosecutors, legislators, and businessmen in Guatemala, El Salvador, Honduras, and Nicaragua citing evidence of corruption or attacks against democracy. The sanctions are part of the most recent update to the ‘Engel List’, which since 2021 has become a tool to publicly scold key actors in the region and an indicator of the Biden administration’s diplomatic strategy in Central America. Standing out on this new list are the names of the main actors involved in a judicial strategy to impede the participation of Guatemalan opposition party Semilla in the August 20 run-off election, moves which have been denounced by the international community as an attempted electoral coup.
In the case of Nicaragua, precisely on the 44th anniversary of the Sandinista Revolution, July 19, the United States sanctioned legislators and public officials involved in the stripping of citizenship from hundreds of Nicaraguans and the banishment of 222 political prisoners in February of this year.
The inclusion of the former left-wing presidents Mauricio Funes and Salvador Sánchez Cerén appears, in the case of El Salvador, to strike a balance after previous lists’ accusations of corruption against key cabinet members in the administration of President Nayib Bukele and leaders of the Arena and FMLN parties. There is abundant evidence, particularly in the case of Funes, that both ex-presidents embezzled from state coffers for personal gain and both have been shielded from facing trial in El Salvador by the Nicaraguan citizenship granted to them by the Ortega dictatorship. But the list makes no reference to those responsible for mass human rights violations under the state of exception —such as the reported state policy of torture in prison— or to officials who have refused to investigate related cases. Nor does the State Department appear to consider anti-democratic the promotion and launch of Bukele’s campaign for reelection despite an explicit constitutional prohibition.
The inclusions and omissions from the sanctions list demonstrate a reordering of priorities in the U.S. strategy in Central America, a region pierced by attacks against the electoral systems and led by presidents hostile to Western sanctions. In Honduras, the designations of a former advisor to ex-president Juan Orlando Hernández and of Yani Rosenthal —a leader of the Liberal Party who ran for president in 2021 after spending three years in U.S. prison on a drug trafficking-related money laundering conviction— point to an effort to smooth over bilateral tensions caused by sanctions last year touching the inner circle of Manuel Zelaya, husband to President Xiomara Castro and her closest advisor. But the assertion that Rosenthal had “manipulated the results” of the recent congressional appointments to the Supreme Court of Justice shines a light on the selection of the next attorney general in the coming months.
The State Department dealt its most severe blow to the Judicial Branch of Guatemala, a country where, when the first edition of the sanctions list was published in 2021, the Biden administration saw a better opportunity to build a constructive relationship than in El Salvador, Honduras, or Nicaragua. Most notable among the six justice system operators and public officials to be sanctioned is criminal court judge Fredy Orellana, for “authoring unsubstantiated, politically motivated criminal charges” against journalist José Rubén Zamora, sentenced in June to six years in prison. They also revoked the visa of Cinthia Monterroso, the prosecutor who presented the state arguments during the Zamora trial.
On July 12, it was the same Orellana who ordered the suspension of the opposition party Semilla —whose candidate Bernardo Arévalo is set to compete in the run-off against former first lady Sandra Torres— at the request of Monterroso’s office, the Special Prosecutor’s Office Against Impunity (FECI), despite a legal prohibition of the suspension of political parties with election season underway.
In a statement issued on July 19, the administration of President Alejandro Giammattei rejected the sanctions by comparing them to a trial without procedural safeguards, based on “value judgements and without the guarantee of legitimate defense through due judicial process. This situation violates the universal principle of the presumption of innocence.” The government attributed the sanctions to “baseless media accusations” and denounced “external interference in internal affairs and the utilization of abusive political tools against Guatemalans.”
The Guatemalan government similarly rebutted the application of the same sanctions against FECI chief Rafael Curruchiche and Attorney General Consuelo Porras for obstructing corruption cases. An investigation by El Faro revealed in February 2022 how Porras and Curruchiche worked together to impede a criminal investigation into alleged bribery in 2019 of Giammattei.
“This doesn’t affect me at all, and only demonstrates my good work. So much so that an entire international department has sought to neutralize me,” reacted Monterroso on Wednesday. “Anyway, my visa expired in 2018 and I didn’t renew it because I have no intention to travel to the United States. I went there once and didn’t like it.”
This is the third and final consecutive year that the Department of State applies the visa revocation policy as stipulated in Section 353 of the Northern Triangle Enhanced Engagement Act, known colloquially as the ‘Engel List.’ In December the U.S. Congress could decide whether to renew the mandate.
The U.S. also sanctioned two fundamental actors in the conviction in May of anti-corruption prosecutor Virginia Laparra, declared a “prisoner of conscience” by Amnesty International: former judge Lesther Castellanos, the current rapporteur against torture who, according to the State Department, “retaliat[ed] against” Laparra by filing the criminal accusation against her that led to her incarceration; and Omar Barrios, current president of the executive board of the National Port Commission, for “conspiring to intimidate” Laparra.
Minutes after the publication of the list, Barrios tweeted a picture of a medal from the “Regional Security Department” of the transnational fruit and vegetable company Dole “for cooperating in the fight against crime and for strengthening maritime and port protections.” In the evening he accused the United States of “covering up crimes of corruption financed with its budget.”
Role of the Private Sector
In 2021 and 2022 the Engel List identified actors in a deep web of influence peddling, schemes of bribery in exchange for public contracts, and other illicit activity in the Guatemalan high courts and Congress. Now, for a third year in a row —and as opposed to the sanctions of members of the government in El Salvador, Honduras, and Nicaragua— the list does not touch Giammattei’s inner circle.
“This list is right about identifying by first and last name various Guatemalan actors tied to corruption or anti-democratic actions, including the electoral crisis,” says Ricardo Barrientos, executive director of the Central American Institute of Fiscal Studies (ICEFI).
“But we do not see people with large shares of economic and political power behind these actors,” he continues. “Who is giving money to bribe judges and prosecutors to perpetrate these crimes? Who are financing the ‘netcenter’ structures who carry out digital attacks on social media, a clearly anti-democratic action?”
“This international support is important, valuable, and appreciated, but we Guatemalans must respond for the problems of Guatemala, just like Salvadorans for the problems of El Salvador and Hondurans for those of Honduras,” Barrientos insists.
“We are deeply concerned by the recent attempt of the Public Ministry to threaten the integrity of the election process,” said Frank Mora, U.S. Ambassador to the Organization of American States, in a Permanent Council session on Wednesday. “The ongoing efforts to interfere with Guatemala’s elections threaten to undermine its democratic process and its adherence to the Inter-American Democratic Charter.”
“As we have noted in the past with Venezuela and Nicaragua, what is happening in Guatemala affects us all,” Mora continued, adding —in an apparent reference to the powerful business lobby CACIF’s backing of the certification of the first-round results— that “in particular the United States is grateful for the Guatemalan private sector’s strong commitment to the integrity of the country’s election.”
“The Guatemalan private sector is one of the factors that have influenced a bipartisan understanding in the United States which we have not seen since the exit of the International Commission against Impunity in Guatemala (CICIG),” asserts Ana María Mendez, Central America director of the Washington Office on Latin America. “It’s because of the enormous weight of commercial relations in the bilateral relationship. The United States defends those interests [of the private sector], of ‘legal certainty,’ from the threat of a new Nicaragua.”
“Four Nicaraguas”
The Engel sanctions have received bipartisan support from both chambers of a polarized U.S. Congress. On Friday, July 14, the chairmen of the two congressional foreign relations committees jointly condemned “the Guatemalan Attorney General’s Office’s attempt to illegally revoke the legal status of the political party of an opposition candidate in advance of the country’s August 20 runoff presidential elections.” The press statement concluded: “As the lead Republican on the Northern Triangle Enhanced Engagement Act, McCaul also calls on the Biden administration to make full use of the Section 353 sanctions authorities.”
“McCaul’s statement (in favor of Section 353 sanctions) was a major victory for the Biden administration, signaling that not all Republicans hold the same view on Central America,” says Eric Olson, director of public policy at the Seattle International Foundation. “The GOP instinct is to be pro-sanctions, but some have seen Central America through a traditional left-right Cold War optic. McCaul's positioning would appear to be less ideological and more about corruption, rule of law and democracy.”
On July 16, two-dozen conservative presidents from around the hemisphere and Spain —among them, Alfredo Cristiani of El Salvador, Felipe Calderón of Mexico, and Álvaro Uribe of Colombia— issued a statement condemning “the disqualifications and political judicialization in Argentina, Guatemala, and Venezuela” elections.
Manuel Orozco, of Inter-American Dialogue, also ascribes the appetite in Washington for more individual sanctions in Central America to the idea of preventing the consolidation of another dictatorship like the one headed by Daniel Ortega and Rosario Murillo.
The U.S. government, European Council, and Canada have sanctioned dozens of officials from the three branches of Nicaraguan government since the 2021 elections. In April of last year, Nicaragua expelled the OAS from the country and announced its departure from the multilateral organization.
There is an growing current within the Nicaraguan opposition in exile that believes that the electoral path toward democracy has been closed ever since the arrest of seven opposition candidates during the 2021 race and the cancellation of the two primary opposition parties. Ortega’s decision this year to strip the citizenship of 222 political prisoners has propelled new discussions among exiled leaders about peaceful options to recover democracy. A spokesperson for the initiative says that competing in the 2025 elections would be out of the question.
The stripping of the nationality of hundreds of people, banishment of the political prisoners, and confiscation of assets and pensions are the throughlines of the State Department’s most recent sanctions, touching the first and second vice presidents of the National Assembly, the director of the Nicaraguan Social Security Institute, and two appeals judges involved in the trials of political prisoners.
“These designations are part of a series of measures that the administration is taking in a policy of applying the same instruments to all four countries, and partly in an effort to prevent the region from becoming four Nicaraguas,” says Orozco. “The designations connect the transgressions of the regime in terms of violations of the right to freedom of expression, free enterprise, and commerce.”
“These are sanctions designed precisely for the illegalities implemented against the banished political prisoners and the denaturalized,” Juan Sebastián Chamorro, 2021 presidential candidate and one of the former political prisoners expelled to the United States by plane in February, told El Faro.
“During the 20 months that I spent in prison, I had an enormous amount of interrogations and the issue of sanctions was recurrent. They have always paid much attention to sanctions, but not because they mean much in material terms,” he said. “There is an important social dimension to the sanctions. These names become known in Nicaragua by the people, family members, and neighbors. And that generates fissures in the structure that supports the dictatorship between those who commit the crimes and those who have nothing to do with them, like the professor, the nurse, the doctor, or the very soldier or police officer.”
Equidistance in El Salvador
In July 2021, when the first edition of the list was published, one of the primary preoccupations of the U.S. government, as expressed in its sanctions policy, was the Bukele-controlled Legislative Assembly’s illegal removal of the Constitutional Chamber magistrates and the attorney general two months prior in El Salvador, during the first legislative session of the new legislature. In an update to the list in September of that year, the State Department added the five magistrates of the Constitutional Chamber who ruled in favor of presidential reelection despite an explicit constitutional prohibition.
The provision that anyone who promotes consecutive presidential periods should lose their citizenship has not dissuaded the president himself, nor legislators of the ruling Nuevas Ideas party and their allies. There has been no indication that the Attorney General’s Office has opened an investigation into the public comments and campaign announcement.
When asked by El Faro about the absence of references to unconstitutional reelection in El Salvador in the newest list, a U.S. government official in Washington only responded that “the list doesn’t represent the full opinion of the United States on these four countries.”
Since 2021, the Engel List has also sanctioned Bukele’s chief of cabinet Carolina Recinos, his legal advisor Conan Castro, and numerous other senior officials in his government. The U.S. Treasury has even frozen the assets of three officials —Recinos among them— for their involvement in clandestine negotiations with gangs or in a “multi-ministry, multi-million dollar corruption scheme.”
Since 2022 each of the heads of state and foreign ministers of El Salvador, Guatemala, and Honduras have made calls for respect for sovereignty and non-intervention in internal affairs, generating some resonance among Washington Republicans. Last year, Bukele tweeted his own response in capital letters: “UNITED FRUIT COMPANY.” After a visit to San Salvador in March of this year, Senator Marco Rubio, the influential Florida Republican, accused Biden of “actively alienat(ing) or allies and opt(ing) to appease murderous dictators in our region.” U.S. Ambassador William Duncan publicly met with Bukele for the first time on July 13, seven months after his swearing-in.
In its newest additions to the Engel list, the State Department accused former President Mauricio Funes of “orchestrating and participating in several schemes involving bribery, embezzlement, and money laundering while president, pilfering hundreds of millions of dollars from state coffers.” An El Faro investigation revealed proof in 2019 that Funes had spent at least hundreds of thousands of dollars from a secret presidential discretionary fund on international trips and luxury purchases.
The department wrote that his vice-president and successor, Salvador Sánchez Cerén, “launder[ed] money during his tenure as vice president, personally receiving more than $1.3 million in public funds in exchange, and participated in a scheme to divert $183 million in public funds away from public accounts and oversight into personal accounts while serving as president.” The $183 million dollars are the amount from the discretionary fund for which the Sánchez Cerén administration declined to indicate where the money was spent, arguing that the information was classified.
Also on the list are Miguel Meléndez, a close advisor to Funes convicted in August 2022 of requesting bribes in exchange for public contracts, and three former officials of the state-run Banco Hipotecario (mortgage bank), for allegedly laundering tens of millions of dollars in exchange for bribes.
“There appears to be a message between the lines to the current leadership of the bank, which has played an important role in the configuration of bitcoin policy and other corruption cases connected to the current administration, like those of Munir Bendek and Pablo Anliker,” argues Wilson Sandoval, coordinator of the Anti-Corruption Legal Advisory Center.
With these sanctions “everyone is in the same basket now,” he adds, in reference to the inclusion of Funes and Sánchez Cerén. “In Casa Presidencial they must be discussing now to handle this issue. What can they say now, that the list is illegitimate because it only mentions their people? I think [the State Department] is trying to calibrate a new communications strategy with this new update to the list.”
“Yet to be seen are possible sanctions under the Global Magnitsky Act, meaning that there is plenty of space for more sanctions. It’s a tool better reserved for corruption cases and human rights violations, which are the recurrent elements that we’ve seen in the current Salvadoran context,” he explains.
Eyes on the Honduran Congress
“The inclusion of Yani Rosenthal is a clear message to the political party, particularly given the upcoming election of the attorney general,” indicates Honduran human rights lawyer Joaquín Mejía. “How is it possible that, after completing a sentence and being continually mentioned in New York drug trafficking trials, that he is still at the head of the Liberal Party? The party is serving as the door hinge for negotiations in the National Congress.”
The Honduran Congress is set to receive a list of finalists for attorney general on August 31. Prosecutors and forensic analysts from the Public Prosecutor’s Office went on strike for 79 days this year until they reached an agreement for salary raises, exposing the institutional fragility in the country after the installation in December of a state of exception modeled on that of El Salvador under promises of curbing extortion. Cooperation with the top prosecutor’s office will be a key piece in the eventual formation and chances for success of an eventual International Commission Against Impunity in Honduras (CICIH) backed by the United Nations.
In addition to Rosenthal and Roberto Antonio Ordóñez Wolfovich, a former advisor to Juan Orlando Hernández, the State Department sanctioned a congressman from the Liberal Party and former public health, electricity, and public works officials for evidence of embezzlement, contracts awarded without competition, intimidation of journalists, and manipulation of the nomination of the new Supreme Court.
The Honduran government, like that of El Salvador, has not directly responded to the new sanctions, but former head of state Manuel Zelaya, husband-advisor to President Castro, retweeted a video published by a radio station in which the sanctioned Liberal Party legislator, Samuel García, denounced that “far-right legislators from the Liberal Party are the ones ratting to the American Embassy. And the saddest part is that the Embassy made the decision without investigating, simply on the basis of reports. Those rats from the cartel just wanted to look good.”
“This list has left a bitter-sweet feeling because, if these people are being sanctioned for corruption, for manipulating processes and attacking democracy, they have done so with total impunity. And one might wonder why the State Department does not include Attorney General Óscar Chinchilla on the list, the one directly responsible for these people being allowed to act with total impunity,” continues Mejía. “I think it’s time for citizens to rise up again and demand resignations and responsibility.”
“This edition of the Engel list and the prior ones are a necessary step, but they’re not enough,” concludes Barrientos of ICEFI. “It must reach the intellectual authors and financiers of these structures in Central America that are attacking democracy and fomenting corruption.”
