The United States has banned former Panamanian President Juan Carlos Varela Rodriguez from entering the country “due to his involvement in significant corruption” while in office.
The announcement, made by Secretary of State Antony Blinken, accuses Varela of accepting bribes in exchange for granting government contracts.
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“This designation reaffirms the commitment of the United States to combat endemic corruption in Panama,” Blinken said in his statement.
“It is our hope that today’s action will prompt Panama’s elected representatives and authorities to tackle entrenched corruption and empower all those who stand up for the rule of law.”
Named for the Brazilian construction firm at the heart of the case, the Odebrecht scandal involved officials allegedly collecting bribes as they doled out major public works contracts.
While in office, Varela was implicated in the scandal, with lawyer and former adviser Ramon Fonseca Mora accusing him of accepting bribes from Odebrecht as “donations”.
“President Varela told me — may lightning strike me if I lie — that he had accepted donations from Odebrecht because he couldn’t fight everyone,” Fonseca told reporters in 2017.
At the time, Varela, a former businessman, was in the midst of his five-year term in office, which spanned from 2014 to 2019. He denied any wrongdoing.
Previously, Varela — the scion of one of Panama’s wealthiest families, famous for its rum brand — served as vice president under fellow conservative Ricardo Martinelli.
But the two men had a falling out, and in 2011, Martinelli stripped Varela of a second position he held as foreign affairs minister.
Martinelli has likewise been accused of participating in the Odebrecht case, among other allegations. His two sons, Luis Enrique Martinelli Linares and Ricardo Martinelli Linares, both served prison sentences in the US for their role in the money-laundering scandal.
In addition, the elder Martinelli was extradited from the US in 2018 on accusations that he used public money to spy on political opponents and journalists. He was acquitted in 2021, with a Panamanian court ruling there was insufficient evidence.
Martinelli, his sons and Varela are scheduled to stand trial for their alleged roles in the Odebrecht case. They have been barred from leaving Panama.
In Thursday’s press release, Secretary of State Blinken underscored the deep costs such a scandal can inflict.
“Corruption unjustly deprives the people of Panama of quality public services such as schools, hospitals, and roads, hurting their economic prospects and their quality of life,” he wrote.
“If not addressed, corruption will continue to depress Panama’s prosperity, weaken its democracy, and prevent it from realising its full potential.”