VZCZCXYZ0001
OO RUEHWEB

DE RUEHQT #1607 1982135
ZNY CCCCC ZZH
O 172135Z JUL 07
FM AMEMBASSY QUITO
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7406
INFO RUEHBO/AMEMBASSY BOGOTA PRIORITY 6763
RUEHCV/AMEMBASSY CARACAS PRIORITY 2610
RUEHLP/AMEMBASSY LA PAZ JUL 0654
RUEHPE/AMEMBASSY LIMA PRIORITY 1780

C O N F I D E N T I A L QUITO 001607 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: DECL: TEN YEARS 
TAGS: PGOV PREL EC
SUBJECT: CONGRESS VOTES "NO CONFIDENCE" IN FINANCE MINISTER 
 
REF: QUITO 1182 
 
Classified By: PolOff James Cohen for reasons 1.4 (b) and (d) 
 
¶1.   (SBU)  Summary:  Continuing the standoff between 
Congress and the Correa administration, Congress passed a 
vote of no confidence July 13 against Minister of Finance 
Ricardo Patino.  Citing allegations of embezzlement, illicit 
association, collusion and treason, Congress passed the 
measure after Patino failed to appear before a Congressional 
hearing into the allegations, declaring the Minister "in 
rebellion" (in contempt of Congress).  Since the vote of no 
confidence is non-binding, and President Correa has 
reiterated his confidence in Patino, the vote will have no 
immediate practical effect.  But President of the Congress 
Jorge Cevallos announced his intention to transfer the 
charges to the Office of the Attorney General for 
investigation, keeping the matter in the spotlight.  End 
Summary. 
 
NO SHOW, NO CONFIDENCE 
---------------------- 
 
¶2.  (SBU)  By a margin of 66 to 34, Congress passed a vote of 
no confidence against Minister of Finance Ricardo Patino July 
¶13.  The proceedings began with a vote to declare Patino in 
"rebellion," since he did not appear before Congress as 
requested.  With that procedure out of the way, the no 
confidence debate was led by Luis Almeida (PSP - Partido 
Sociedad Patriotica) and Diego Ordonez (UDC - Union of 
Christian Democrats).  Both deputies highlighted Patino's 
perceived complicity in the recent scandal involving possible 
manipulation of the international bond market (reftel). 
Additionally, they accused Patino of mishandling foreign 
debt, misappropriating public funds, violating two articles 
of the Law on Fiscal Transparency and lying about his 
economic expertise and qualifications.  They produced 
documents to suggest that he did not graduate with an 
economics degree as cited on his curriculum vitae. Most 
center-right deputies voted in favor of the no confidence 
measure.  While Pachakutik, small leftist parties and some 
members of the National Dignity Bloc voted against the 
measure, no deputies came to Patino's defense rhetorically. 
 
EXECUTIVE BRANCH STANDS FIRM AS FIGHT CONTINUES 
--------------------------------------------- -- 
 
¶3.  (SBU) Patino refused to appear before Congress to defend 
himself, telling supporters outside the Congress building 
that Congress was corrupt and out for blood, then retreating 
to his office.  President Correa vowed to stand by his 
Finance Minister and expressed total confidence in him. 
Speaking from Italy, Correa noted in his weekly radio address 
in regards to the Patino matter, "Today, more than ever, 
Congress is corrupt and has no credibility." 
 
¶4.  (SBU) Under the 1998 Constitution, the no confidence vote 
is non-binding and has no force of law.  In order to continue 
the case against Patino, President of Congress Cevallos 
announced July 14 that he intends to request that the charges 
against Patino be investigated by the Attorney General.  Many 
deputies in the Congress, led by John Argudo (ID), support 
the notion of criminal proceedings against Patino, not only 
because a conviction would force him from office, but also 
because, in their view, Patino committed felonies. 
 
COMMENT 
------- 
 
¶5. (C)  As the Constituent Assembly election campaign 
approaches, Correa's opponents will not let go of the Patino 
issue.  Knowing that Congress has the lowest approval rating 
of any government institution, Cevallos is banking on an 
independent investigation to keep the issue alive in the 
media.  Embassy contacts at the Supreme Electoral Tribunal 
have privately told us that they fear there is more dirt on 
Patino and that his opponents will dole it out piecemeal to 
embarrass Correa closer to the September 30 Constituent 
Assembly election.  The fact that deputies included in their 
attack accusations that Patino lied on his resume indicates 
that they will dig up whatever they can to turn this into a 
political advantage. 
 
JEWELL