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Paraguay vice president blacklisted by U.S. for corruption to resign

Paraguay's President Mario Abdo Benítez and Vice President Hugo Velazquez are pictured at the National Congress in Asuncion in November 2018, when they presented bills aimed at fighting money laundering, terrorism and organized crime. (Norberto Duarte/AFP/Getty Images)

Paraguay’s vice president, a candidate in the country’s presidential elections next year, announced his resignation on Friday after U.S. officials blacklisted him for alleged “significant acts of corruption.”

The news has thrust the South American nation into a moment of political uncertainty, fostering a lack of trust in the government in the midst of an electoral season, analysts and officials said.

Secretary of State Antony Blinken announced Friday morning that the United States had included Vice President Hugo Adalberto Velázquez Moreno on a corruption list for his alleged role in, among other things, offering a bribe to a public official and interfering in public proceedings. The U.S. government also included on the list Juan Carlos “Charly” Duarte Martínez, a close associate of the vice president.

At Velázquez’s request, Duarte allegedly offered a bribe of more than $1 million to a public official to obstruct an investigation that threatened the vice president’s financial interests, Marc Ostfield, U.S. ambassador to Paraguay, said in a news conference Friday. Ostfield described it as “an act consistent with an apparent pattern of shared corrupt activity.”

The designations mean that Velázquez, Duarte and their immediate family members are barred from entering the United States.

“The corrupt acts of Velázquez and Duarte undermine the confidence of the Paraguayan people in the stability of Paraguay’s democratic institutions,” Ostfield said.

Prosecutor on his honeymoon is gunned down by hit men at beach

Following the announcement, Velázquez told a local radio station he was withdrawing his candidacy for president and planned to resign as vice president next week. He denied the U.S. government’s accusations, which he said “fell like a bucket of cold water,” especially given his frequent rhetoric about fighting organized crime.

He said he made the decision to resign to defend himself and clear his name as a “common citizen.”

Paraguayan President Mario Abdo Benítez told reporters on Friday that the news “surprised all of us.”

“I say this with pain, because he’s a friend,” the president said, “But I congratulate him for his mature attitude in prioritizing the interests and the construction of credibility in our nation.”

Duarte also serves as legal counsel for the Yacyretá Bi-National Entity, which operates the Yacyretá Dam that is jointly owned by Paraguay and Argentina.

“Duarte’s act of corruption abused and exploited his powerful and privileged public position within the Yacyretá Bi-National Entity, risking public confidence in one of Paraguay’s most vital economic assets,” Blinken said in a statement released by the State Department.

Ostfield said the decision was not political, and that the United States planned to continue to work closely with Paraguayan President Mario Abdo Benítez on several issues, including the fight against corruption and impunity, as well as against money laundering.

Late last month, the State Department also designated former Paraguayan president Horacio Cartes for allegedly obstructing “a major international investigation into transnational crime in order to protect himself and his criminal associate from potential prosecution and political damage,” according to a news release.

The string of allegations comes just months after the brazen killing of Paraguayan prosecutor Marcelo Pecci roiled the South American country, a nation of about 7 million people landlocked between Brazil and Argentina. Pecci was with his new wife, celebrating their honeymoon in a resort in Cartagena, Colombia, when hit men rode up on personal watercraft and opened fire on Pecci.

In June, Colombian authorities sentenced four people to prison after they confessed to participating in the killing. Authorities say the slaying of the prosecutor, who was known for investigating organized crime in Latin America, was connected to international drug trafficking groups.

Sebastián Acha, a political analyst and former Paraguayan lawmaker, said the U.S. government’s blacklisting confirmed suspicions held by many Paraguayans for a long time. But the news, combined with other recent corruption accusations and the killing of Pecci, has shaken the country’s trust in its democratic institutions.

“What it clearly tells us, and what we need to take very seriously,” he said, “is that the justice system is infiltrated by corruption at the very highest levels.”