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Cablegate: Nicaragua: Gon to Review Past Property Claims Decisions

VZCZCXYZ0000
RR RUEHWEB

DE RUEHMU #0106/01 0282159
ZNR UUUUU ZZH
R 282159Z JAN 08
FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC 2010
INFO RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE

UNCLAS MANAGUA 000106

SIPDIS

STATE FOR WHA/CEN, EB/IFD/OIA AND L/CID
STATE FOR WHA/EPSC
STATE PLEASE PASS TO USTR
TREASURY FOR INL AND OWH

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: EINV ECON USTR KIDE NU
SUBJECT: NICARAGUA: GON TO REVIEW PAST PROPERTY CLAIMS DECISIONS

REF: A) 07 MANAGUA 2581, B) 07 MANAGUA 2615, C) 07 MANAGUA 2442, D)

07 MANAGUA 2324, E) 07 MANAGUA 2494, F) 07 MANAGUA 0002

SUMMARY
-------

1. (SBU) The December 20 monthly Working Property Group meeting
confirmed that the Attorney General plans to reduce the number of
outstanding property claims as quickly as possible and that
dismissing claims is the preferred method to accomplish this goal.
We believe that we further convinced GON officials of the
seriousness with which we take U.S. citizen claims and of our full
intention to follow through on all potential dismissals. On a
positive note, GON officials told us that they are reviewing the 12
claims we highlighted during September and November working group
meetings involving properties that government entities control.

FRANK DISCUSSION WITHOUT SUPERINTENDENT PEREZ
---------------------------------------------

2. (SBU) During the December 20 monthly Working Group meeting,
Econoffs met with three officials from the National Confiscations
Review Commission (CNRC), and two officials from the Office of
Assessment and Indemnification (OCI), to clarify the Government of
Nicaragua's (GON) administrative process to dismiss 18 U.S. citizen
claims as "no ha lugar" (Refs A and B). The fact that Property
Superintendent Yara Perez did not attend gave us our first
opportunity to explore the views of her often silent colleagues and
clarify what they were doing to implement changes in policy.

ATTORNEY GENERAL TO DISMISS CASES
---------------------------------

3. (SBU) It is becoming clear to us that the Attorney General plans
to reduce the number of outstanding property claims as quickly as
possible and that dismissing claims is his preferred method to
accomplish this goal. As part of his responsibility to safeguard
the nation's economic resources, GON officials explained, the
Attorney General will exercise his authority to dismiss claims that
do not meet a new threshold for proof of ownership and/or
expropriation.

GON RAISES THE THRESHOLD TO PROVE OWNERSHIP
-------------------------------------------

4. (SBU) To increase the number of claims that the Attorney General
may consider for dismissal, the GON has raised the threshold for
proof of ownership and/or expropriation. Claimants must now produce
the original title or cadastral records, according to one OCI
official. Proof of payment associated with property ownership, such
as utility or tax receipts, are no longer enough. Moreover, the
Attorney General may review and dismiss claims at any time prior to
final settlement -- and may even dismiss a claim for which the
government has already negotiated, but not consummated, a
settlement.

NEW THRESHOLD STRICTER THAN REQUIRED BY LAW
-------------------------------------------

5. (SBU) Econoffs requested a formal explanation of the Attorney
General's authority to dismiss claims and challenged setting the
threshold for proof of ownership and/or expropriation so high. The
new standard is much stricter than what is required by law and
clearly disadvantages some claimants. We argued that Nicaraguan law
provides for considerable flexibility when it comes to furnishing
proof of ownership. In many instances, property titles and
cadastral records were lost or destroyed when the country drifted
from revolution into civil war during the 1980s. This was the
decade in which the government confiscated some 30,000 properties as
part of nationalization and land redistribution campaigns, often by
employing questionable legal practices and creating documents that
conferred the same property right to more than one party.

6. (SBU) Comment: We are not satisfied with the explanation that has
been presented to us. We believe that for claimants who have waited
ten years to have their cases considered, unilateral and
administrative dismissal based on recently raised thresholds for
proof is unfair. Moreover, claimants have only 15 days to appeal
the Attorney General's decision to dismiss their claims. We will
continue to advocate that the government take a more flexible
approach. End Comment.

SOME NOT SO REASSURING VERBAL ASSURANCES
----------------------------------------

7. (SBU) A CNRC official assured Econoffs that the Embassy would be
afforded sufficient time to contact U.S. claimants before their
cases were dismissed. GON officials also assured us that U.S.
claimants would be given the opportunity to provide additional
evidence of ownership and expropriation to strengthen their claims.
When we asked whether the GON had begun notifying claimants that
their cases had been dismissed, an OCI official replied that this
was a subject that the Attorney General would discuss with the
Ambassador. Begin comment: We are not reassured by these verbal
statements. We will follow any developments related to U.S.
claimants very closely and will not take any dismissals lightly.
The Ambassador has already raised the issue with Attorney General
Estrada (Ref F), and will continue to do so. End comment.

PROGRESS ON CLAIMS INVOLVING GOVERNMENT AGENCIES
--------------------------------------------- ---

8. (SBU) On a positive note, GON officials told us that they are
reviewing the 12 claims we highlighted during September and November
working group meetings (Refs A and D). These involve properties
controlled by the Nicaraguan Army, the Ministry of Interior, and
Jalapa City Police. GON officials presented detailed updates on
each and told us that they wanted to resolve these claims as soon as
possible. Econoff observed that settling these claims would
contribute to meeting two out of three benchmarks set by Secretary
Rice in her July 31, 2007, letter to Foreign Minister Santos
regarding Section 527 and goals for this waiver year.

COMMENT
-------

9. (SBU) The absence of Property Superintendent Yara Perez allowed
us to communicate freely with other GON officials and to discuss
in-depth U.S. citizen claims under GON control. We have been
seeking separate working level meetings on a regular basis that
would serve this purpose, but have been consistently rebuffed by
Attorney General Estrada and Superintendent Perez.

10. (SBU) While confirming the intentions of the Attorney General to
dismiss cases was not the intended result of the meeting, we were
prepared for that outcome. We believe that during the course of the
meeting, we further convinced GON officials of the seriousness with
which we take U.S. citizen claims, and our full intention to follow
through on all potential dismissals. Indeed, we have completed the
first round of a campaign to contact all U.S. citizen claimants to
inform them of the Nicaraguan Government's policy changes and the
need to contact the Property Superintendent to make sure that their
files are accurate and complete. As of January 25, we have sent 296
of 308 letters. Almost immediately, we began receiving responses.

TRIVELLI

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