NICARAGUA - US Strikes Again at Ortega’s Inner Circle

President Daniel Ortega’s son Rafael has become the third Ortega family member to be blacklisted by the US Department of the Treasury’s Office of Foreign Assets Control (OFAC). The sanctions, which were also directed at three companies owned or controlled by the Ortega family, are the US government’s latest attempt to pressure the Frente Sandinista de Liberación Nacional (FSLN) administration to end its crackdown of government opponents which began in April 2018. While providing a fillip to the opposition, these efforts have yet to have their desired effect, serving instead to harden the Ortega government’s resolve.

On 12 December OFAC announced its decision to sanction Rafael Ortega for alleged money-laundering along with two of his companies that it said were used to finance and launder money for the Ortega government - Inversiones Zanzibar and Servicio De Protección Y Vigilancia. OFAC also blacklisted fuel distribution company Distribuidora Nicaragüense de Petróleo (DNP) for “being owned or controlled by, or having acted or purported to act for or on behalf of, directly or indirectly,” Vice President and First Lady Rosario Murillo (who was sanctioned in November 2018 for allegations of human rights abuses and corruption) as well as Rafael Ortega. The US sanctioned another of Ortega’s sons, Laureano, for corruption, in April 2019. Other members of Ortega’s inner circle to be blacklisted include police director Francisco Díaz and the secretary general of the Managua mayor’s office, Fidel Moreno.

  • Companies sanctioned

According to OFAC, Inversiones Zanzibar has been used to obscure the transfer of profits from DNP and as a “front company” while Servicio De Protección Y Vigilancia is a security company which has received millions of US dollars in government contracts and provides protection for Ortega family businesses.

Government response

With the Organization of American States (OAS) yet to indicate whether it intends to act on its latest report, presented last month, which determined that actions by the Ortega administration qualified as undemocratic under Article 20 of the OAS Democratic Charter, the government responded to the latest sanctions by nationalising DNP via a law passed on 14 December by the FSLN-controlled national assembly which declared the fuel and other assets of DNP, a matter of “citizen security and national interest”. This follows a similar move in March in response to US sanctions after the national assembly ratified

the N$743bn (US$23m) government purchase of Banco Corporativo (Bancorp), a financial institution blacklisted by the US for its ties to Venezuela’s state oil company Pdvsa. The following month Bancorp requested permission from the country’s banking regulator, Siboif, to cease operations.

Opposition claims step towards “big coalition”

The latest move by the US could provide a boost to the two main opposition movements Alianza Cívica por la Justicia y la Democracia (ACJD) and Unidad Nacional Azul y Blanco (UNAB) which, on 12 December, presented a joint electoral reform proposal, described by UNAB leader Félix Maradiaga as a “first big step towards a big coalition”.

Among other things the proposal calls for the threshold to be elected president to be increased from the current 35%+1% to 50% +1 which, if not attained, would result in a second round; no presidential re-election; and a bar on a president being succeeded by a spouse. It also calls for the election of new electoral authorities, and national and international observers.

The event marking the launch of the proposal, which took place in Managua, also made headlines amid reports and camera footage of the police attacking journalists, opposition politicians, and relatives of political prisoners.