Peru’s President Faces Possible

Ouster in Corruption Scandal

A congressional session on Friday. Lawmakers signed a document calling President Pedro

Pablo Kuczynski “morally handicapped.”Credit...Guadalupe Pardo/Reuters

By Andrea Zarate and Nicholas Casey

• Dec. 15, 2017

LIMA, Peru — Lawmakers voted on Friday to begin proceedings that could oust
President Pedro Pablo Kuczynski of Peru, the latest leader accused of involvement
in a corruption scandal that has shaken some of Latin America’s biggest countries.

The dispute involves Odebrecht, a Brazilian construction giant, which last year
admitted to paying roughly $800 million in payoffs in exchange for lucrative
projects. That revelation set off a flurry of investigations by prosecutors and
lawmakers, principally in Latin America, seeking to learn who was on the receiving
end of the payments.

According to documents sent to Congress and released this week, Odebrecht paid
$782,000 in advisory fees to Westfield Capital, a company Mr. Kuczynski owns.
Most of the payments occurred between 2004 and 2007, while Mr. Kuczynski
served as Peru’s economy minister and prime minister.
On Friday, lawmakers voted overwhelmingly to move ahead with proceedings next
week that could remove Mr. Kuczynski from office, on the grounds that he is
“morally handicapped.” They scheduled a hearing for Thursday, at which Mr.
Kuczynski is expected to present a defense.

“This scandal has highlighted the moral misery of our political regime,” Alberto
Quintanilla, a lawmaker with the New Peru party, said before the vote.

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Mr. Kucynski’s opponents would need a two-thirds majority to remove him. The
vote on Friday was 97 to 17.

“By Christmas we will probably have a new president,” Eduardo Dargent, a

political-science professor at the Pontifical Catholic University of Peru, said before
the vote. He noted that Mr. Kucynski’s party holds only a few seats in Congress to
defend him. Unlike impeachment proceedings, the ouster proposed by lawmakers
would not require a lengthy trial, he said.

Mr. Kuczynski, 79, has refused to step down. On Thursday night the president gave
a speech in which he said he had done nothing wrong, but he did not deny that
payments were made. “I’m not running, I’m not hiding, I have no reason to do so,”
he said.

Mr. Kuczynski said he had invoices for the transactions, adding that while
Westfield Capital did belong to him, he had not managed it personally. He said he
had reported the transactions to the authorities in January and had not signed any
contracts with Odebrecht.
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“I am an honest man and have been all my life,” he added.

Mr. Kuczynski’s center-right Peruvians for Change party holds only 18 of the
legislature’s 130 seats. His main rival, Keiko Fujimori, lost to him in the last
presidential election, in June 2016, but maintains a large majority in the legislature
through her right-wing Popular Force party.

In September, the opposition party flexed its muscles by staging a no-confidence

vote against the president, and calling for the entire cabinet to resign and for Mr.
Kuczynski to pick new ministers.

“The president increasingly appears unlikely to serve out his term in office,” wrote
Fernando Freijedo, an analyst with the Economist Intelligence Unit, in a note to
clients on Friday.

Mr. Kuczynski is the latest in a growing list of leaders who have been accused or
sentenced to crimes related to the scandal.

On Wednesday, a court in Ecuador sentenced the country’s vice president, Jorge

Glas, to six years in prison on charges of receiving millions of dollars in bribes from
Odebrecht through his uncle.

In October, an ousted Brazilian prosecutor released a tape in which an Odebrecht

official said that President Nicolás Maduro of Venezuela had accepted millions in
campaign contributions in exchange for contracts.

Two former Peruvian presidents also face charges of accepting bribes, with one in
jail and another at large.

Prosecutors have said Odebrecht paid bribes on 100 projects in more than a dozen
countries, in one case buying a local bank branch to hide the transactions, and even
opening a division dedicated to payoffs.

Throughout Latin America, the company built bridges, dams, power plants and
roads, along with a highway linking Brazil and Peru that greatly exceeded its
budget. Nearly three years of investigations have prompted at least 77 Brazilian
Odebrecht executives to sign plea deals, and led to the imprisonment of the
company’s former chief executive, Marcelo Odebrecht.

Andrea Zarate reported from Lima, and Nicholas Casey from Hanga Roa, Chile.

A version of this article appears in print on Dec. 16, 2017, Section A, Page 9 of the New York edition with the
headline: Peru Leader Faces Ouster Over Links To Builder. Order Reprints | Today’s Paper | Subscribe