Guatemala Congress withdraws bill that cut anti-graft penalties

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GUATEMALA CITY (Reuters) - Guatemala’s Congress on Friday repealed a controversial bill it had passed only two days earlier, which critics had blasted as a setback in the fight against political corruption.

Prosecutors have accused President Jimmy Morales and the main political parties of illegal campaign financing, so opponents were outraged when Congress on Wednesday passed a “national emergency” decree to curb penalties for the offense.

The legislation sought to make party accountants responsible for irregularities rather than party leaders.

As public outcry mounted, Morales said on Thursday he was prepared to veto the legislation if it was against the nation’s interest. Congress responded by announcing it would withdraw the bill.

A motion to repeal the bill passed on Friday afternoon with 130 votes in favor and none against in Guatemala’s Congress, with 28 absentees. Earlier this week, the legislation had been approved by lawmakers with a vote of 105-19 in favor.

Guatemalan lawmakers and anti-graft proponents have been locking horns in recent months.

U.N.-backed anti-graft body, the International Commission Against Impunity in Guatemala (CICIG), and Attorney General Thelma Aldana have accused Morales and political parties of using illicit financing in the 2015 election campaign and sought to impeach the president over the charge.

However, Congress voted not to strip Morales of his immunity from prosecution earlier this month.

In August, Morales attempted to expel the head of the CICIG, veteran Colombian prosecutor Ivan Velasquez, from Guatemala. Instead the president was thwarted by the country’s top court and came under a barrage of international criticism.

Reporting by Sofia Menchu, Editing by Rosalba O’Brien