Mexico Fines Pro-Fox Parties Over Campaign Financing

The two political parties responsible for Vicente Fox’s successful 2000 presidential bid were fined $48.8 million Friday for violating campaign finance rules, the first known sanction of its kind in Mexico against a governing party.

Ending a three-year inquiry, the nonpartisan Federal Electoral Institute ruled that Fox’s campaign failed to disclose donations of $8.1 million, about one-fifth of what it spent. The campaign also exceeded legal spending limits by $1.6 million and received $4 million from prohibited sources.

The action carries no legal consequences for Fox, because election officials have power only to fine political parties, not to prosecute individuals. Though the long-running scandal hurt Fox’s image as the maverick elected to clean up Mexican politics, the electoral institute -- which runs the country’s elections -- solidified its role as a neutral arbiter of the country’s democratic transition.

Friday’s ruling was meant to put to rest a bitterly fought sequel to the 2000 vote, which ended 71 years of rule by the Institutional Revolutionary Party, or PRI, and left both major parties accusing each other of violating election finance laws.

Last March, the electoral body fined the PRI a record $98 million for having received more than $45 million in illegal funding from the labor union at Pemex, the state oil company. The once-omnipotent PRI was reduced to asking its supporters for a peso a day to help it meet a two-year deadline to pay the fine.

The sanction levied Friday was a hard blow to Fox’s center-right National Action Party, or PAN. It was hit with two-thirds of the fine, while the Green Party, the junior partner in Fox’s Alliance for Change, must pay the remainder.

Both parties said they would contest the fine in court.

German Martinez, one of the PAN’s leaders in Congress, said the decision was unjust because the illegal donations came from a campaign support committee called Friends of Fox, which had little connection to either party.

Accusations that the committee tapped wealthy foreigners and other illegal sources surfaced soon after Fox took office. He dismissed them at the time as revenge for an investigation he had ordered into the PRI’s campaign funding.

The inquiry into Fox’s campaign gained momentum after a court ruling last year gave the electoral institute access to bank records. After examining 55 accounts, it said it found campaign money from four outlawed sources: Mexican companies, PAN members of the Senate, unnamed contributors, and a foreign donor identified as Luis Arturo Delgado of Pasadena, who gave $11,000.

In addition, Fox’s campaign was found to have received money from 13 people who exceeded the $54,000 legal limit on individual contributions.

The institute’s general council, made up of political party representatives and nonpartisan citizens, approved the sanction Friday by a vote of 6 to 0, with three abstentions.

“This is not an insignificant amount but a fair one, as it is proportionate to the offenses committed,” said Alonso Lujambio, head of the electoral institute’s committee on campaign financing.

Sen. Fidel Herrera, the PRI’s representative, called the fine a token punishment based on an “incomplete, insufficient, half-hearted” inquiry.

Many analysts disagree, adding that the electoral institute has a growing reputation for evenhandedness. In surveys, Mexicans consistently rank it among the country’s most respected institutions, along with the army and the Roman Catholic Church.

“In Mexico’s democratic transition, there are still public servants who commit abuses with impunity, there is still a lack of reforms, but at least we have fair, well-run elections,” said Daniel Lund, a veteran pollster here. The electoral institute, which gained its oversight powers in a 1996 law, “has evolved into a genuinely autonomous body,” he said.

Election officials have proved far more effective at pursuing campaign-related illegalities than has Fox’s government.

The prosecutor’s office announced over the summer that it had insufficient evidence of “major crimes” to press fraud and money-laundering charges against union leader Carlos Romero Deschamps over illegal campaign contributions to the PRI’s 2000 presidential campaign.

Fox’s administration also failed to secure the extradition from Houston of Rogelio Montemayor, the former Pemex director, in the same case.

Meanwhile, prosecutors have dropped a money-laundering investigation against seven leaders of Friends of Fox, saying there was no evidence that any of their campaign contributions were raised illegally.