Financial Crime World

Corruption Runs Deep in Paraguay as President-Elect Prepares to Take Office

Paraguay has long been plagued by corruption, a problem that shows no signs of abating despite efforts by authorities. The election of Santiago Peña as president-elect on April 30 has raised concerns about the country’s ongoing corruption issues.

The Ties Between Corruption and Politics

Peña’s victory is a concern for many in Paraguay due to his party’s ties to former President Horacio Cartes, who was sanctioned by the US Treasury Department for corruption. The Colorado Party, led by Peña, has been accused of working with Brazil’s First Capital Command (PCC), a notorious organized crime group.

Allegations Against Cartes

  • Money laundering
  • Drug trafficking
  • Links to the PCC

Despite these allegations, Cartes’ allies have managed to evade prosecution. The previous attorney general never brought charges against him, and it is likely that investigations will struggle to move forward under Peña’s administration.

The Challenge of Rooting Out Corruption

“Fighting corruption requires decades and a great social commitment that is difficult to achieve without a change in power,” said David Riveros García, executive director of the Paraguayan anticorruption organization reAcción.

Corruption Beyond Politics

Corruption extends beyond the Colorado Party, with:

  • A network of customs officials allowing smugglers to pass freely across borders
  • The navy aiding traffickers
  • Ammunition produced exclusively for the armed forces being found in the hands of criminals

The State’s Capacity to Dismantle Organized Crime

Despite attempts to take down the PCC, Paraguay lacks the state capacity to dismantle the gang’s transnational operations. With little changing in Paraguay’s political outlook, it is likely that corruption and organized crime will continue to plague the country for years to come.