updated 8/20/2004 6:22:24 PM ET 2004-08-20T22:22:24

Less than a week after his inauguration, President Leonel Fernandez has given top posts to four former officials charged with involvement in the disappearance of millions of dollars in public funds in the late 1990s.

Critics say the appointments contradict campaign promises to crack down on corruption as the Dominican Republic weathers its worst economic crisis in decades.

The Fernandez administration has defended the officials, saying the allegations were politically motivated.

All four served in the first Fernandez government from 1996 to 2000, and all have trials pending on charges stemming from the alleged disappearance of $100 million from the Temporary and Minimal Employment Program, a fund intended to create jobs and quell strikes.

The program’s ex-coordinator, Luis Inchausti, was arrested on embezzlement charges in 2001, and this week he was named to the Cabinet post of secretary of state without portfolio, traditionally a top presidential adviser.

“This is a bad start,” Pedro Catrain, a political science professor at the Autonomous University of Santo Domingo, said Thursday. “Even if it turns out they are innocent, ethically Fernandez shouldn’t have named them.”

Four were arrested in 2001
The scandal broke in 1998 after an audit by the Department for the Prevention of Corruption. Inchausti and three others were arrested in 2001. Prosecutors said those other three were in positions to have known that the money was taken and were negligent in not reporting it.

The others include former Public Works Secretary Diandino Pena, who was appointed to head a subway construction project; former administrative secretary Simon Lizardo, now the nation’s top auditor; and former auditor Haivanjoe Ng Cortina, who will regulate the Santo Domingo Stock Exchange.

Those three are charged with negligence, and, like Inchausti, all say they are innocent. They are free pending trials that have yet to be scheduled.

Corruption is a chronic problem in the Caribbean nation of 8.8 million people. A bank fraud scandal in 2003 cost the treasury $2.2 billion and sent the economy into a tailspin.

Fernandez was sworn in Monday after trouncing President Hipolito Mejia in the May election, promising a return to economic progress.

Fernandez, who presided over strong growth, left office in 2000 because of a single-term limit that was later rescinded. He denied wrongdoing in the embezzlement scandal, but his popularity suffered and his chosen successor, Danilo Medina, was easily defeated by Mejia in 2000.

Now Fernandez has promised a clean administration and has accused Mejia’s administration of widespread corruption.

New government blames politics
The government says that the four appointees have impeccable credentials and that politics is at the root of the charges.

“In this country, you are innocent until you are convicted and sentenced,” said Hector Olivo, a spokesman for Fernandez’s Dominican Liberation Party.

Fernandez’s opponents are seizing on the appointments as an act tainting his government.

“There are many others Fernandez could have chosen,” said Rafael Peralta, a spokesman for Mejia. “This is contrary to good ethics.”

This week, Fernandez also ordered the retirement of 97 generals from the armed forces, including Gen. Jose Miguel Soto Jimenez, the top military leader.

Fernandez’s designated leader, Adm. Sigfrido Pared Perez, has said fewer than 100 of the 202 total generals were needed. Dozens of officers were elevated to general under Mejia, and many served in largely honorary roles.

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