WASHINGTON — Today, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Luis Miguel Martinez Morales (Martinez) for his role in corruption in Guatemala wherein he engaged in widespread bribery schemes, including schemes related to government contracts. Martinez is being designated pursuant to Executive Order (E.O.) 13818, which builds upon and implements the Global Magnitsky Human Rights Accountability Act and targets perpetrators of serious human rights abuse and corruption around the world.
“Today’s action underscores the corrosive impact of corruption on the public’s trust in government institutions. Martinez sought to leverage his privileged position for personal benefit at the expense of the Guatemalan people,” said Treasury’s Under Secretary for Terrorism and Financial Intelligence Brian E. Nelson. “The U.S. government will continue to hold accountable individuals whose corrupt schemes undermine democracy and do harm to populations around the world.”
Today’s action builds on the Administration’s efforts to address corruption as a root cause of irregular migration through the northern Central America region. Corrupt and anti-democratic acts, including those that threaten the integrity of an orderly transition of power in Guatemala, undermine Guatemala’s democratic institutions and threaten the stability of Guatemala and the region as a whole. The Guatemalan people have spoken and their voices must be respected.
Since 2021, the U.S. government has sanctioned 11 individuals and entities in Guatemala for their roles in corruption. The Department of State also has used a range of visa restriction tools, to promote accountability for corrupt and undemocratic actors in Guatemala. These actions demonstrate the U.S. government’s continued commitment to stand by the Guatemalan people.
LUIS MIGUEL MARTINEZ MORALES
Martinez is the former head of the now-defunct Centro de Gobierno, a powerful quasi-cabinet level agency created by Guatemalan President Alejandro Giammattei (Giammattei) at the start of his administration. President Giammattei was forced to shut down the Centro de Gobierno in December 2020 following backlash to Martinez’ rising power in the government. During his time as the head of Centro de Gobierno, Martinez was considered one of the most powerful unelected officials in the government. While he does not currently hold a government position, Martinez remains one of the most influential individuals in the Giammattei administration.
Martinez has influenced the government contracts process to benefit himself and close associates. Martinez colluded with other Guatemalan government officials to illegally award contracts to favored bidders outside of Guatecompras, the Guatemalan government’s formal procurement system. Martinez and his conspirators used antiquated procurement law to forego the bidding process and secure government contracts for companies in which he has a financial interest.
In 2021, Martinez solicited large kickbacks to facilitate the purchase of the Russian Sputnik V vaccines by the Government of Guatemala. Guatemala’s special anti-corruption agency investigated Martinez for his role in a controversial payment tied to the purchase of 16 million doses of Russian Sputnik V COVID-19 vaccines by the Guatemalan government.
Martinez is being designated pursuant to E.O. 13818 for being a foreign person who is a current or former government official, or person acting for or on behalf of such an official, who is responsible for or complicit in, or who has directly or indirectly engaged in, corruption, including the misappropriation of state assets, the expropriation of private assets for personal gain, corruption related to government contracts or the extraction of natural resources, or bribery.
SANCTIONS IMPLICATIONS
As a result of today’s action, all property and interests in property of the person described above that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC. In addition, any entities that are owned, directly or indirectly, individually or in the aggregate, 50 percent or more by one or more blocked persons are also blocked. Unless authorized by a general or specific license issued by OFAC, or otherwise exempt, OFAC’s regulations generally prohibit all transactions by U.S. persons or within (or transiting) the United States that involve any property or interests in property of designated or otherwise blocked persons. The prohibitions include the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any designated person, or the receipt of any contribution or provision of funds, goods, or services from any such person.
The power and integrity of OFAC sanctions derive not only from OFAC’s ability to designate and add persons to the SDN List, but also from its willingness to remove persons from the Specially Designated Nationals and Blocked Persons (SDN List) consistent with the law. The ultimate goal of sanctions is not to punish, but to bring about a positive change in behavior. For information concerning the process for seeking removal from an OFAC list, including the SDN List, please refer to OFAC’s Frequently Asked Question 897 here. For detailed information on the process to submit a request for removal from an OFAC sanctions list, please click here.
GLOBAL MAGNITSKY
Building upon the Global Magnitsky Human Rights Accountability Act, E.O. 13818 was issued on December 20, 2017, in recognition that the prevalence of human rights abuse and corruption that have their source, in whole or in substantial part, outside the United States, had reached such scope and gravity as to threaten the stability of international political and economic systems. Human rights abuse and corruption undermine the values that form an essential foundation of stable, secure, and functioning societies; have devastating impacts on individuals; weaken democratic institutions; degrade the rule of law; perpetuate violent conflicts; facilitate the activities of dangerous persons; and undermine economic markets. The United States seeks to impose tangible and significant consequences on those who commit serious human rights abuse or engage in corruption, as well as to protect the financial system of the United States from abuse by these same persons.
Click here for more information on the individuals designated today.
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