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Costa Rica supports banning contracts with corrupt companies

The Costa Rican government has introduced a law project that would prohibit companies involved in acts of corruption from participating in any new contracts with the Public Works and Transport Ministry (MOPT).

The bill comes a month after news broke of an alleged bribery scandal involving several of Costa Rica’s largest infrastructure companies.

“The project seeks to guarantee the transparency of the public procurement processes promoted by the MOPT and avoid the award of new contracts to natural and / or legal persons who do not turn out to be suitable contractors,” a statement from Casa Presidencial reads.

“Said limitation is a reasonable measure to safeguard the public interest.”

The ongoing bribery investigation, nicknamed “Cochinilla” after a parasitic insect, became public knowledge in mid-June when Judicial Investigation Police (OIJ) raided Casa Presidencial – among other public and private entities – and detained 30 people.

Here’s what we know so far:

What is the Cochinilla scandal?

On June 14, police raided houses, private construction companies and Casa Presidencial as part of an investigation into an alleged bribery network.

According to OIJ’s director, Walter Espinoza, authorities believe private construction companies offered bribes – money, vehicles, land, sexual favors and more – in exchange for preferential treatment in obtaining government infrastructure contracts.

The financial toll has been estimated at $125 million, but the real impact is significantly greater. For instance, companies allegedly used defective asphalt in road projects and, through bribes, manipulated the quality tests to meet construction requirements.

Who is involved?

The alleged bribery network involves members of the National Highway Council (CONAVI), high-ranking officials in the H. Solis and MECO construction firms, and an advisor to President Carlos Alvarado.

CRHoy published the surnames of those detained and their known roles:

  • Cerdas Araya, detained in Escazú (MECO businessperson).
  • Bolaños Salazar arrested in Curridabat.
  • González Carballo (MECO).
  • Alpízar Maple (MECO).
  • Bonilla Guillén (MECO).
  • Solís Vargas, detained in Santa Ana (businessperson of H. Solís).
  • Abarca Quesada, detained in Coronado.
  • Martínez Martínez, detained in Cartago.
  • Herrera Chacón, detained in San Carlos.
  • Castro Rodríguez, detained in Alajuela.
  • Cervantes Morales, detained in Heredia (Conavi official).
  • Solís Murillo, detained in Sabanilla (former financial manager of Conavi).
  • Zuñiga Fallas, detained in Desamparados (Conavi official).
  • Madrigal Rímola, detained in Conavi (manager of institutional supply of Conavi).
  • Carmona Rivas, detained in Desamparados
  • Mora Obando, detained in Cartago.
  • Ortiz Vega, detained in Zapote.
  • Chaves Mora, detained in San José (Conavi, Sixaola binational bridge executing unit).
  • Rojas Monge, detained at Conavi (financial director).
  • Quesada Pérez, detained in San José.
  • May Cantillano, detained in Desamparados (Conavi’s road maintenance manager).
  • Zamora Zamora, detained in Heredia.
  • Ureña Villalobos, detained in Heredia.
  • Quesada Aguirre, detained in Desamparados.
  • Sánchez Castro, detained in San Ramón.
  • Lobo Bejarano, detained in Moravia.
  • Monge Hernández, detained in Cartago.
  • Rodríguez Araya, detained in San José.
  • Rivera Campos, detained in Alajuela (Conavi official).

What has been the response?

In a national address, President Carlos Alvarado said: “Where there is a corrupt person, there is also a corrupter, and both must be punished. It is my wish, just like that of the rest of Costa Ricans, that the bottom line of the matter is reached and that responsibilities and sanctions be felt.”

The advisor to the president, Camilo Saldarriaga, resigned his position, while the director of CONAVI has asked to be reassigned to a different role.

President Alvarado says CONAVI – the government agency most heavily implicated in the scandal – must be further investigated and says he’s seeking “the appropriate legal mechanism to do so as soon as possible.”

More generally, though, the Cochinilla case is another blow to public trust in government. It’s also a stain on the administration of President Alvarado; under his leadership, Casa Presidencial has been raided twice for separate scandals.

Criminal proceedings are underway against some of those detained.

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