Bloomberg News

Ecuador Central Bank Head Quits After Admitting Fake Diploma

December 20, 2012

Ecuador central bank head Pedro Delgado, a cousin of President Rafael Correa, resigned yesterday after admitting he used a fake college degree to apply to business school more than two decades ago.

Delgado acknowledged the lie at a news conference yesterday, saying “I committed an extremely grave error 22 years ago, I made the wrong decision to achieve an academic objective and I made a mistake that today is costing me dearly.” Correa on his Twitter account last night said Delgado used the false degree in economics to apply to the Central American Institute of Business Administration, or INCAE, which has campuses in Nicaragua and Costa Rica.

It’s been an “extremely hard day,” Correa, 49, who is running for a second term in February’s national elections, said on Twitter last night. “He’s done a great harm to the revolution.”

Correa, a self-declared socialist revolutionary who has sparred with banks since taking office in 2007, has adopted policies that are similar to those of Argentine President Cristina Fernandez de Kirchner. Both have sought to boost liquidity and limit capital outflows after defaults limited access to overseas credit markets.

Correa is expected to name economist Rosa Matilde Guerrero to replace Delgado, the Wall Street Journal reported today, citing a person familiar with the leader’s plans.

No Degree

“I presented a document with no value that certified I had a degree which I didn’t hold,” Delgado said, apologizing to his family and the Ecuadorean people.

The resignation’s impact on markets will probably be minimal because Ecuador uses the U.S. dollar as its currency and has only one international bond, the 9.375 percent note due in 2015, said Siobhan Morden, the head of Latin America fixed- income strategy at Jefferies Group Inc. Yields on the bonds fell 22 basis points today, or 0.22 percentage point, to 8.68 percent, the biggest decline since August.

“It’s a dollarized economy, so the role of the central bank is marginal,” Morden said in a telephone interview from New York.

Ecuador’s inflation slowed to 4.77 percent in November after peaking at 6.12 percent in March.

On the resignation of Delgado, who Correa appointed last year, “you can look at it positively,” Morden said. “At least if he didn’t have the degree they let him go.”

To contact the reporters on this story: Eric Martin in Mexico City at emartin21@bloomberg.net.

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net.


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