News
Portal advised the president that the matter was 'extremely serious.'

Peña Nieto was advised of ‘master fraud’ and did nothing: ex-auditor

More than 5 billion pesos was misappropriated, according to prosecutors

Former president Enrique Peña Nieto was advised about the so-called “Master Fraud” embezzlement scheme in which government departments allegedly misappropriated billions of pesos but did nothing, according to the former chief auditor.

In an interview with the newspaper El Universal, Juan Manuel Portal said that he spoke to Peña Nieto at a 2017 meeting about the involvement of the secretariats of Social Development (Sedesol) and Agrarian Development and Urban Planning (Sedatu) in the scheme.

The former head of the Federal Auditor’s Office (ASF) said he told the ex-president that the matter was “extremely serious” and needed to be cleaned up.

Portal also said he told Peña Nieto that ASF reports about the embezzlement scheme had been sent to the president’s office.

“Analyze them . . . Look at them with the Secretariat of Public Administration . . .” he recalled telling the president.

Asked whether Peña Nieto took any action, Portal responded: “No, there was the intention, but he didn’t do anything.”

He also said he told the ex-president about irregularities that the ASF detected in the state oil company’s purchase of fertilizer plants, for which former Pemex CEO turned fugitive Emilio Lozoya faces charges.

In response, Peña Nieto “took note to find out what it was about,” Portal said.

The “Master Fraud” scheme, in which billions of pesos were misappropriated through allegedly phony contracts with universities and shell companies, is back in the spotlight after a judge this week ordered former cabinet secretary Rosario Robles to stand trial on charges related to the case.

The Attorney General’s Office alleges that through omission, Robles allowed over 5 billion pesos (US $258 million) to be misappropriated from the federal budget while she was at the helm of Sedesol and later Sedatu.

There has been speculation that Robles’ successor at Sedesol, José Antonio Meade, and Peña Nieto could also face charges.

Meade followed Robles as social development secretary.
Meade followed Robles as social development secretary.

However, the head of the federal Financial Intelligence Unit, Santiago Nieto, said today that Meade is not under investigation.

Robles’ legal team said at a hearing this week that their client told both Meade and Peña Nieto about the financial irregularities at the departments she headed.

Asked whether Peña Nieto should be investigated for omission, Portal said that must be determined by a judge before reiterating that the former president was “aware” of the corrupt practices occurring within his administration.

Likewise, the former ASF boss said that it wasn’t up to him to determine whether Meade should be investigated but added that “he was there [and] he should have known the [content of] the reports.”

Portal told El Universal that in meetings with Robles, the former secretary rejected that public funds had been misappropriated via public universities.

He said that Robles told him that she had personally verified the proper use of funds that had allegedly been embezzled.  

“. . . The area in which she has a misunderstanding is that it is the Auditor’s Office that audits, not her,” Portal said.

Before one meeting, the former ASF chief said a truck arrived with more than 60 boxes of documents which Robles asked him to review.

However, a revision of the documents showed that they were “pure rubbish: copies, photocopies of photographs of events that had no date, no place, no nothing,” Portal said.

Asked how similar thefts of public money can be avoided, Portal said the law needs to be changed to ensure that the heads of government secretariats and other agencies such as Pemex are required to sign off on the expenditure of large amounts of funds.

Without that change, officials will continue to say “‘I didn’t sign anything,’” he said.

“We also need to strengthen confidence controls, train people [and] have more honest people [in government],” Portal said.

“However, the example comes from the president or the secretary. Each . . . must set an example . . . If everyone knows that a secretary is doing it [embezzling money] or if the president is diverting resources, who below them will respect [the law]? That’s why [setting] an example is very important . . . [as are] penalties.”

Source: El Universal (sp)

Reader forum