Mexico arrests former high-ranking PRI official in corruption probe

MEXICO CITY (Reuters) - Mexican authorities on Wednesday arrested a former high-ranking official of President Enrique Pena Nieto’s party in a corruption investigation in the northern state of Chihuahua, the state’s governor said.

The arrest extends a streak of corruption allegations dogging the ruling Institutional Revolutionary Party (PRI), with four former governors arrested on such charges this year. Entrenched corruption is expected to be a key issue in the runup to Mexico’s next presidential election in 2018.

Alejandro Gutierrez, who was the adjunct secretary to the presidency of the PRI, was arrested in a joint operation by state and federal police, Chihuahua Governor Javier Corral wrote in a post on Facebook.

The Chihuahua prosecutor’s office accused Gutierrez of participating in a “sophisticated scheme” to divert public funds of 250 million pesos ($13 million) earmarked for educational programs in 2016. Gutierrez will present himself before a judge early Thursday, the office said in a statement.

This week, Mexican newspaper Reforma published reports on an alleged Chihuahua corruption scheme to funnel the money into the PRI’s campaign fund, through avenues such as fake contracts for workshops for parents and expensive software.

The reports were based on testimony to prosecutors by former state finance minister Jaime Herrera that the paper obtained.

Gutierrez’ arrest took place in Coahuila. This week, he rejected allegations against him in an interview with Mexican newspaper Vanguardia, saying he was considering suing for defamation.

“I am thinking, I will have to look into it, if I initiate some legal proceeding,” he said. “I do not know, I repeat to you, I did not know not even one official, nor ex-official, of finances... I see things that are absolutely false.”

Gutierrez’ arrest “contributes to the clearing up of the crimes of political corruption that have been attributed to the former governor, César Duarte Jáquez,” said Corral, of the National Action Party.

The government is determining whether others should be held responsible for the funneling of funds to PRI coffers in 2016, Corral added.

In March, a Mexican judge issued an arrest warrant for Duarte on suspicion of embezzlement. Corral has said he is a fugitive from justice.

A spokesman for the PRI did not immediately respond to a request for comment.

The PRI was routed in 2016 regional elections, losing several of its bastions, including the states of Veracruz, Tamaulipas and Quintana Roo, as voters expressed discontent over a series of graft scandals.

Reporting by Jose Luis Gonzalez in Ciudad Juarez and Christine Murray, Julia Love and Sharay Angulo in Mexico City; Editing by Michael Perry and Clarence Fernandez