VZCZCXYZ0007
OO RUEHWEB

DE RUEHQT #1350/01 1641219
ZNY CCCCC ZZH
O 131219Z JUN 07
FM AMEMBASSY QUITO
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7196
INFO RUEHBO/AMEMBASSY BOGOTA PRIORITY 6712
RUEHCV/AMEMBASSY CARACAS PRIORITY 2581
RUEHLP/AMEMBASSY LA PAZ JUN 0624
RUEHPE/AMEMBASSY LIMA PRIORITY 1714
RUEHGL/AMCONSUL GUAYAQUIL PRIORITY 2438
RHEFDIA/DIA WASHDC
RHMFISS/CDR USSOUTHCOM MIAMI FL

C O N F I D E N T I A L QUITO 001350 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: DECL: TEN YEARS 
TAGS: PGOV PREL EC
SUBJECT: VIDEO SCANDAL EXPANDS 
 
REF: QUITO 1182 
 
Classified By: PolChief Erik Hall for reasons 1.4 (b&d). 
 
¶1.  (C) Summary:  Another secretly-taped video involving 
Economy Minister Ricardo Patino has become public, extending 
the controversy over an earlier video (reftel).  The new 
video dates to February, and shows President of Congress 
Jorge Cevallos discussing his efforts toward congressional 
approval of the referendum over the national constituent 
assembly.  Media and opposition assert the video reveals 
Correa government manipulation of other branches of 
government, and claim more damaging videos will follow. 
While far short of a "smoking gun," the videos convey 
unseemly back-room dealings that have put the Correa 
government on the defensive and begun to erode public 
support.  More damaging revelations are promised in coming 
weeks.  End Summary. 
 
Video Content 
 
¶2.  (U) The video tape contains footage of a meeting between 
Patino and Cevallos in Patino's hotel room, on the evening of 
February 12, shortly before Congress approved the 
government's controversial assembly referendum proposal. 
(Note: the referendum, strenuously opposed by the opposition, 
was approved by voters on April 15 by more than 81%.) 
Christian Democratic Union (UDC) congressman Jaime Estrada 
(like Cevallos a native of Manabi province) also appears in 
the meeting, as does Patino's political advisor Quinto 
Pazmino. 
 
¶3.  (U) Most of the conversation consists of Cevallos (a 
founding member of Noboa's PRIAN) describing that day's 
session of Congress and how he planned to overcome procedural 
restrictions (and his own "problems with my own party") to 
permit a vote once passage of Correa's referendum statute was 
assured.  (Note:  Cevallos followed through and the measure 
was passed in the subsequent session).  Cevallos also 
expressed his concerns about whether Lucio Gutierrez's PSP 
party could be trusted to hold to its pledge to support the 
assembly proposal.  Patino's participation in the 
conversation is limited to asking a few questions.  At one 
point Estrada changed topics and lobbied for Patino's support 
for a $100m infrastructure project in Manabi province.  Once 
the video became public, the PRIAN formally expelled Cevallos 
and the Democratic Left (ID) has joined the PSC and PRIAN in 
calling for his resignation. The UDC is reportedly planning 
to oust Estrada as well. 
 
Patino's Defense Lame 
 
¶4.  (U) In response to blanket press interest, minister 
Patino has counter-attacked the press, claiming it is "no 
coincidence" that the video emerged on TeleAmazonas, the 
media outlet owned by Bank of Pichincha president Fidel Egas. 
 Egas' decision to broadcast the video is clearly an attempt 
to thwart the government's proposed banking reform, which he 
and other banking interests vehemently oppose, according to 
Patino.  President Correa's public support for Patino, 
meanwhile, remains solid. Correa's sister Pierina, however, 
has said publicly that Patino has become a distraction to the 
government's agenda and should step down. 
 
Opposition Seeking "Smoking Gun" 
 
¶5.  (C) PSC national president Pascual del Cioppo and PSC 
ex-congressman Luis Fernando Torres told the DCM on June 8 
that the second video would soon be released, and that others 
would follow.  The videos would demonstrate damaging 
collusion between the Correa government and other nominally 
independent branches (judiciary, embodied by Supreme 
Electoral Tribunal president Jorge Acosta; and legislative, 
represented by Cevallos) to clear the path to approving the 
April 15 referendum over a national constituent assembly. 
While this particular video falls short of offering any 
"smoking gun," these opposition members assert that it will 
compound and extend the controversy over clandestine taping 
of sensitive meetings, and could further degrade presidential 
popularity which has dipped recently. 
 
¶6.  (C) Another ex-congressman from the PSC, Alfredo Serrano, 
shed some light on the provenance of the tapes.  In a meeting 
on June 12 Serrano claimed that ex-Patino aide Pazmino 
possessed multiple tapes from sensitive sessions, and had 
flogged them with opposition-supporting members of the 
economic elite.  According to Serrano, PRIAN leader Alvaro 
Noboa paid $200K for a copy of the video (originating with 
Pazmino), only to be scooped by the release of a different 
copy by media outlet TeleAmazonas days later.  Serrano 
claimed PSC credit for acquiring and releasing the first 
video.  He said other damaging videos exist and will be 
released in turn, in the hope of damaging government 
credibility in the run-up to the assembly election in 
September.  The PSC has urged other opposition leaders to let 
the press, rather than opposition politicians, lead this 
attack. 
Comment 
 
¶7.  (C) Opposition members ousted from Congress are reeling 
from what they perceive to be the Correa government's 
political persecution (although they continue to garner 
little sympathy from the public).  They see Patino as an 
increasingly vulnerable surrogate for Correa.  Impeachment 
proceedings against Patino could gather steam from this, the 
second secret video featuring Patino.  But even if 
successful, impeachment does not automatically remove a 
minister, and thus far Correa has shown no inclination to 
jettison one of his most trusted confidants. 
 
¶8.  (C) The ousted opposition deputies have little hope that 
the newly re-constituted Constitutional Court will rule in 
their favor, and instead plan to appeal to the IACHR (Noboa 
is reportedly funding the legal bills for that effort). 
Judging from recent conversations, they are also willing to 
contemplate any and all means to terminate his government 
prematurely.  They justify undemocratic means with the charge 
that Correa's game plan for the upcoming constituent assembly 
is "pre-cooked" and itself undemocratic.  These opposition 
members believe Correa will use his majority to advance the 
timetable for elections in early 2008, and to purge the 
constitution of "neo-liberal bias" and consolidate his 
personal power by extending the presidential period to six 
years, with re-election permitted.  While this video is not 
particularly damaging in itself, it is certainly the case 
that were a "smoking gun" video to emerge, popular support 
for the government's reform agenda could erode. 
JEWELL