Development: On 7 November the judge investigating a corruption scandal at Ecuador’s state-owned oil company, Petroecuador, ruled that four of the accused (including the brother and sister of a former energy minister, Carlos Pareja) must be taken into custody while the investigation continues.
Significance: The judge ruled that these individuals, which also include Ramiro Luque (from Galileo Energy, one of Petroecuador's suppliers) and Sonia Calero (from Grupo Azul, another supplier) had failed to comply with a 21 October ruling that required them to present themselves several times a week in front of a judge. Although the initial ruling also stated that the individuals must remain in Ecuador, it is believed that the four individuals have fled to the US. This has prompted the Ecuadorean authorities to request that Interpol add these people to a list of individuals being sought for possible involvement in the scandal. Interpol is already looking for Carlos Pareja, who is also believed to have fled to the US.
- Around a dozen people are currently under investigation for alleged corruption relating to the refurbishment of Petroecuador’s Esmeraldas refinery in 2014-2015. Given Carlos Pareja’s close and long-running relationship with Ecuador's President Rafael Correa, the ongoing investigation could have political implications for the upcoming presidential election in February 2017. Although Correa is prevented from running for another term in office, the investigation could impact negatively on the ruling Alianza País (AP) party’s chosen presidential candidate, Lenín Moreno, particularly if the scandal widens significantly.
- The suspected fleeing of individuals implicated in the Petroecuador case to the US is embarrassing for the Ecuadorean authorities, since it is not the first time that they have been unable to prevent high-profile suspects from leaving the country: a cousin of the president and former central bank governor, Pedro Delgado, fled to the US while under investigation for embezzling public funds in 2012. Given that Ecuador extradites suspected criminals to the US only infrequently, it may be difficult to secure the extradition of the accused from the US.
Looking Ahead: Currently, Moreno remains popular and well ahead of his nearest rivals in the pre-electoral polls, but the investigations into corruption in the Correa administration have the potential to make the presidential race a more closely-fought contest than in recent elections.