Latin America’s Virus Villains:

Corrupt Officials Collude With

Price Gougers for Body Bags and
Flimsy Masks
The coronavirus has devastated Latin America. And it has only been worsened
by a wave of graft and profiteering, prosecutors say.

A forensic investigator disinfecting a body bag holding the remains of a man

who collapsed on the street and died from from the coronavirus last month in
Quito, Ecuador.Credit...Dolores Ochoa/Associated Press

Of all the schemes that have siphoned resources from Latin American countries
fighting the coronavirus, the body bag conspiracy might be the most brazen.

Last month, prosecutors in Ecuador announced they had identified a criminal

ring that had colluded with health officials to win a contract selling body bags to
hospitals at 13 times the real price.

Then one of the men implicated, Daniel Salcedo, fled Ecuador in a small plane
that crashed in Peru. Mr. Salcedo is now recovering in the custody of the
Ecuador police.
Even as Latin America has emerged as an epicenter of the pandemic, with
deaths and infections soaring, efforts to contain the crisis have been
undermined by a litany of corruption scandals.

Dozens of public officials and local entrepreneurs stand accused of exploiting

the crisis for personal enrichment by peddling influence to price-gouge hospitals
and governments for medical supplies, including masks, sanitizer and
ventilators. Some of the gear was so flawed that it was rendered useless — and
may have contributed to even more sickness and death.

“People are dying in the streets because the hospital system collapsed,” said
Diana Salazar, Ecuador’s attorney general. “To profit from the pain of others,
with all these people who are losing their loved ones, it’s immoral.”

Investigations into fraud have reached the highest levels of government. The
former Bolivian health minister is under house arrest awaiting trial on
corruption charges after the ministry paid an intermediary millions more than
the going rate for 170 ventilators — which didn’t even work properly.

Marcelo Navajas, Bolivia’s former health minister, looking at a ventilator last

month. He was arrested the next day, May 20, on charges of corruption related
to the purchase of substandard ventilators.Credit...Diario El Debate, via
Reuters
In Brazil, which has the second highest number of coronavirus deaths after the
United States — and on Friday surpassed one million reported cases —
government officials in at least seven states are under investigation on suspicion
of misusing more than $200 million in public funds during the crisis.

In Colombia, the inspector general is investigating reports that more than 100

political campaign donors received lucrative contracts to provide emergency
supplies during the pandemic.
Peru’s police chief and interior minister resigned after their subordinates
bought diluted sanitizer and flimsy face masks for police officers, who then
began dying of infections from the virus at alarming rates.

Prosecutors are investigating links between police officials and the suppliers of
the equipment to determine whether they colluded to defraud the government,
according to Omar Tello, the head of anti-corruption investigators in the
prosecutor’s office.

Armillón Escalante, a police officer in Lima, said that he and his colleagues were
given paper-thin masks and gloves that broke immediately.

“We didn’t really have any protection,” he said. Mr. Escalante was enforcing
social-distancing measures in a crowded market alongside three other officers
who have since died of the virus.

Mr. Escalante became infected in April and spent three weeks intubated in the
hospital. He still suffers pain in his lungs and shortness of breath when talking.

“It wasn’t just me. The majority of us were abandoned,” he said. “I don’t feel the
same as before. The disease has damaged my organs.”

When Peruvian prosecutors began to look into the purchase of protective gear
this month, several boxes of evidence went missing at the headquarters of the
police’s investigative crime unit in Lima. Police officers told the authorities that
several security cameras were not working the day they disappeared.

Mr. Tello said the monitoring system appeared to have been manipulated and
prosecutors are working to extract images of people who removed the boxes.

More than 11,000 police officers in Peru have been infected and 200 have died
of the virus, according to the government, forcing the country to shutter some
stations at least temporarily to contain outbreaks.
Peruvian police officers began dying of infections from the virus at alarming
rates after they were issued flimsy face masks.Credit...Rodrigo Abd/Associated
Press

Coronavirus is testing nations that were struggling with corruption long before
confronting a global health emergency. Presidents in Brazil, Peru and
Guatemala have been forced from office in cases of bribery and kickbacks over
the years.

But the pandemic has broadened the opportunities for public officials in Latin
America to pilfer from state coffers, corruption experts say. Declaring a state of
emergency, several countries suspended some regulations governing public
contracts, paused in-person congressional sessions or did away with rules
requiring them to respond to media requests for information.

“You have the ideal conditions for doing whatever you want,” said Eduardo
Bohorquez, the director of Transparency International Mexico, an anti-
corruption nonprofit group. “There is less transparency, less access to
information, and zero independent oversight from Congress.”

The federal hospital system in Mexico gave back flawed ventilators that it had
ordered from the son of the head of the federal electricity commission, after a
local watchdog group revealed that the government had agreed to pay 85
percent more than the cheapest option.

Last month, an official within the Bolivian health ministry went to a Spanish
company called IME Consulting to purchase 170 ventilators even though
another company was offering the machines for half the price.
The Bolivian government agreed to pay IME Consulting about $28,000 per
ventilator — three times the price that the original manufacturer said it charges
for each machine.

Shortly after the ventilators arrived, doctors began complaining that the
machines were not suitable to treat seriously ill coronavirus patients. A lawyer
for the former health minister, Marcelo Navajas, told reporters he was “totally
and absolutely innocent” and that “there was absolutely no illegal or
inappropriate action here.”

Days before Mr. Salcedo’s botched escape from Ecuador, police officers raided
the home of a former president, Abdalá Bucaram. They arrested him after
having discovered an illegal firearm, along with thousands of face masks and
coronavirus tests.

Former President Abdalá Bucaram of Ecuador, third from left, was escorted out
of his residence in Guayaquil during an early morning raid this
month.Credit...Marcos Pin/EPA, via Shutterstock

“Mr. Bucaram isn’t procedurally qualified as an importer or a vendor of medical

supplies,” said Ms. Salazar, the attorney general. She said prosecutors suspect
that a criminal group including Mr. Salcedo, Mr. Bucaram and some of their
family members have been overcharging hospitals for medical equipment since
2018. Last year, the attorney general said, they sold one hospital thousands of
body bags for $148 each, even though they were only worth about $11.

Mr. Salcedo “has been a vendor during the health emergency as well,” said Ms.
Salazar. “Of course, he had to take advantage.”
Mr. Salcedo’s brother, Noé, was caught this month trying to cross the border
into Peru with $47,000 in cash — money that investigators believe was illicitly
obtained — and he is now in jail. Prosecutors have issued arrest warrants for
Michel and Dalo Bucaram, two of the former president’s sons. Until recently,
Dalo Bucaram was staying at Mr. Salcedo’s house in Miami.

Mr. Salcedo’s lawyer has said her client is not involved in a corruption scheme
and that the cash his brother was carrying came from a bank loan taken out by
his parents. Mr. Bucaram, who is under house arrest, has denied the charges
against him and said he faces “cowardly political persecution.”

Investigators suspect the tests and the masks found in Mr. Bucaram’s house
were destined for Teodoro Maldonado Carbo hospital in Guayaquil, one of the
cities hardest hit by the virus, where dead bodies piled up outside hospitals or
were packed inside empty banana cartons for lack of storage space.

Alex Vivas, a doctor treating coronavirus patients at Teodoro Maldonado Carbo

hospital, said he was appalled by the scheme.

“For us, the medics on the front lines, it is outrageous to see this level of
corruption,” Mr. Vivas said in an interview. “To see how these overpriced
contracts consume up the budgets that should be destined for such protection
gear, it’s simply outrageous.”

Reporting was contributed by José María León Cabrera, Maria Silvia Trigo,
Jenny Carolina González and Elda Cantú.