SANTIAGO – Chilean President Michelle Bachelet has announced plans for a constitutional amendment to remove from office those who have acquired elected positions by illegal means.
She said on Tuesday that preparation of an amendment, coming in the wake of scandals that have rocked the country, will be entrusted to a Presidential Advisory Council in advance of its presentation to Congress.
The amendment to regulate the relationship between politics and business follows a controversial series of events that have engulfed Chilean entrepreneurs, political parties and even her son Sebastian Davalos.
Bachelet said that a 15 member Council based at La Moneda Palace, the government’s headquarters, will be given complete autonomy and will have 45 days to submit proposals to undermine the potential for such conflicts of interest.
Last Saturday, a Chilean judge remanded in custody six of 10 defendants of tax, bribery and other crimes related to the “Penta Case,” including two powerful businessmen and a former under-secretary of the mining ministry.
In another controversy, the “Caval Case,” a real estate business reportedly netted profits worth millions of dollars for Davalos and his wife Natalia Compagnon.
The defendants in the Penta case, named for an investment bank that manages assets worth $20 billion, are accused of defrauding the treasury through tax offenses, bribery, kick-backs and other illegal activities such as financing election campaigns through fictitious businesses and false invoices.
Caval, a small company in part owned by Compagnon, received a $10.4 million loan from the Bank of Chile after intervention from Davalos, to buy land later sold for a profit of $4.8 million.
The bank’s vice president, Andronico Luksic, was also tied to the loan, granted in November 2013 when Bachelet won the presidential elections.
The case is being investigated for insider dealing and peddling of political favors.
The impact of the case has battered Bachelet’s popularity, and Davalos is expected to resign from his government position as socio-cultural director of the Presidency.