VZCZCXYZ0005
PP RUEHWEB

DE RUEHC #1201 1391736
ZNY CCCCC ZZH
P 191723Z MAY 09
FM SECSTATE WASHDC
TO AMEMBASSY MANAGUA PRIORITY 0000

C O N F I D E N T I A L STATE 051201 
 
SIPDIS 
 
E.O. 12958: DECL: 05/18/2019 
TAGS: PGOV PREL ECON NU
SUBJECT: DEMARCHE REQUEST: URGE GON TO RESOLVE PROPERTY 
CLAIMS 
 
Classified By: WHA A/S Thomas A. Shannon for reasons 1.4 (b,d) 
 
¶1. (U) This is an action request.  See para 5. 
 
¶2. (C) The Department is concerned that despite recent GON 
efforts and initiatives to resolve U.S. citizen property 
claims, the number of cases resolved in the 2008-2009 waiver 
year could jeopardize our ability to grant Nicaragua a waiver 
under Section 527 of the Foreign Relations Authorizations Act 
of FY1994/1995.  In granting a waiver to the GON in July 
2008, the Secretary of State outlined three benchmarks by 
which to measure progress, including: (1) the GON's 
successful resolution of a substantial number of 
Embassy-registered claims; (2) the return of or compensation 
for properties held or controlled by the GON; and (3) the 
resolution of property claims controlled by the Nicaraguan 
Army.  To date, progress on all three benchmarks has been 
very modest. 
 
¶3. (C) Further complicating prospects for a waiver for 
Nicaragua are a significant number of dismissed American 
citizen property cases under Decrees 3 and 38, which allowed 
for the confiscation of properties belonging to the "allies" 
of former President Anastasio Somoza following the Sandinista 
revolution.  U.S. concerns regarding such dismissals were 
raised during a December 2008 bilateral review of the GON's 
property claims resolution process and Attorney General 
Hernan Estrada undertook to review cases dismissed by the 
present administration.  Similarly, recent nullifications of 
previously resolved claims are very troubling and could be 
particularly unfavorable to Nicaragua's chances for a waiver 
if allowed to stand. 
 
¶4. (C) The current waiver year will expire on July 28, 2009, 
leaving less than three months for the GON to demonstrate 
significant progress on all three benchmarks.  The Department 
requests that Post urge the GON, at the highest levels, to 
address our concerns and thereby increase the likelihood that 
a Section 527 waiver will be granted for Nicaragua. 
 
¶5. (U) The Ambassador may draw on the following points to 
demarche Foreign Minister Samuel Santos and Attorney General 
Estrada regarding our concerns with U.S. citizen property 
claims in Nicaragua: 
 
Cooperation:  We appreciate the establishment of the Attorney 
General's Liaison Office for U.S. Claims.  The cooperation on 
casework has improved and the Liaison (Rebeca Zuniga) has 
done a good job of working with U.S. citizen claimants and 
the U.S. Embassy's Property Office to advance claims. 
 
Claims Under GON Control:  We appreciate the progress the GON 
has made in resolving claims under the control of the 
Nicaraguan National Police (two claims) and the Nicaraguan 
Army (one claim) during this waiver year.  We understand 
there has been progress on settling the 28 claims of U.S. 
citizen Juan Barreto, whose property is under the control of 
the Army.  Resolving the Barreto case this waiver year would 
be looked on positively by the USG when it decides whether to 
grant a waiver to Nicaragua in July. 
 
Decree 3 and 38 dismissals:  Decree 3 and 38 dismissals are a 
serious concern to the USG.  We were pleased to hear that 
Attorney General Estrada promised in March to review 70 
dismissed claims under Decrees 3 and 38, and that the GON has 
already resolved two claims favorably.  We look forward to 
resolving the remaining 144 dismissals. 
 
Claims In Court:  We remain concerned about the Attorney 
General's policy of withdrawing support from a U.S. citizen 
seeking the return of his/her property in court, and instead 
petitioning on behalf of the illegal occupant.  So far we are 
aware of three claims in which the Attorney General has 
petitioned the court in favor of illegal occupants.  These 
actions undermine the rule of law and discourage claimants 
from using the GON to advance claims in court. 
 
Resolution of Claims Through Official Publication:  Section 
527 of the Foreign Relations Authorization Act recognizes a 
claim as resolved when the claimant determines that he/she 
has received adequate compensation.  The USG does not 
recognize claims as "resolved" that are published in the 
Official Gazette and the indemnification bonds are deposited 
in escrow.  We urge the GON to work with claimants to resolve 
their claims. 
 
Nullification of Previously Resolved Claims:  Reports of 
nullifications of previously resolved claims are very 
troubling.  The National Confiscations Review Commission's 
reversal of its recent nullification notices to two U.S. 
citizens notifying them that their previously settled claims 
had been ruled null is a positive sign.  We hope that other 
nullifications will be treated similarly. 
 
Confiscation of U.S. Citizen Property:  We are concerned 
about reports that the GON recently confiscated the property 
of U.S. citizen Leonidas Guadamuz.  We eagerly await Attorney 
General Estrada's explanation on the status of Mr. Guadamuz' 
property claim.  It is our understanding that Mr. Guadamuz 
has stated repeatedly that he is willing to settle his claim 
through compensation. 
CLINTON