Former Loreto state governor Yvan Vasquez faces over 30 years in prison sentences for various corruption charges including embezzlement and collusion.
Prosecutors are seeking prison sentences of 12 and 19 years for irregularities in the contracting of an Iquitos sewage plant during Vasquez’s administration. The scandal is one of three corruption investigations into his term as governor.
The first charge alleges that Vasquez illegally added $53 million in additional projects to the $125 million contract awarded to China International Water and Electric Corporation (CWE). The second charge stems from protocol irregularities which culminated in a contract worth $155 million, 25% more than what was legally authorized.
Since the contract was awarded in 2010, the state of Loreto has spent over $220 million in oil royalties on the sewage treatment plant. However the city of Iquitos does not have a functional sewage system. An El Comercio report showed that 82% of the plant’s sewage tanks, pipelines and other installations have defects.
Every time the region suffers a heavy rain, water mixed with sewage comes up through residential plumbing systems. Many homeowners in the affected areas have disconnected their pipes from the sewage system to avoid flooding from their toilets, causing the contaminated water to be deposited in the Nanay river which the project was intended to protect.
Representatives from CWE and four other companies involved in the contract also face charges in the scandal. Officials from Peru’s comptroller estimate the Loreto government’s losses range from $60 million and $104 million. CWE is currently in litigation with Loreto, which it says misrepresented the true state of its drainage in the initial technical studies.
Vasquez is also being investigated for a state loan program which distributed $23 million to impoverished farmers. However only $8 million were paid back, and thousands of farmers who put their properties up as collateral claim they never received their loans. Prosecutors found that the recipients contracted to distribute the loans were newly formed companies hand-chosen by Loreto’s government.
In July of 2014, a Loreto court ordered Vasquez to serve 18 months in a preventive jailing sentence for his alleged steering of a $2.7 million contract for four river boats to the Atlantic Internacional Sudamerica company, in which he owned a stake.
Vasquez then became a fugitive when he went into hiding for five days before turning himself in. Two months after reporting to jail, a different court freed Vasquez until prosecutors bring the case to trial.
As a free man, Vasquez ran for reelection, but lost to current Loreto governor Fernando Melendez. Melendez has estimated that Vasquez’s term will leave the state government in debt until 2023.
Vasquez is the former director of the Peruvian Soccer Federation (FPF). Some investigators have alleged that he laundered money through his 97% ownership of the Colegio Nacional Iquitos soccer club.
La fiscalía pedirá 19 años de prisión para Yván Vásquez (El Comercio)
TRAGEDIA EN LORETO (La Mula)