At the bottom of the whole thing, it's a political scheme by Correa to grab the group's three television stations, put government loyalists at their helm and control the airwaves to win a September referendum that would allow him to tighten his grip on the country and seek re-election.

According to Correa's account of this week's events, Ecuadorean police following orders of the government's Deposit Guarantee Agency took over TC-Television, Gamavision, Cablevision, La Troncal Sugar Mill and dozens of insurance, construction and other companies that belonged to the Isaias Group in a measure allegedly aimed at doing justice to the failed business empire's remaining creditors.

Economy Minister Fausto Ortiz resigned in protest.

The Deposit Guarantee Agency says it is trying to recover $661 million allegedly embezzled by the Isaias Group, which owned the Filanbanco financial empire until it was turned over to the government in 1998. The Isaias Group says such claims are ridiculous, adding that Filanbanco has $500 in assets and only owes $30 million to depositors.

Regardless of whether the Isaias Group - led by brothers Roberto and William Isaias - were responsible for a major embezzlement and fled to the United States to avoid prosecution or, as they say, were victims of a financial crisis that led nearly 30 Ecuadorean banks to go under that year, the seizure of their television stations has all the signs of an all-out government attack on freedom of the press.

Consider:

If the seizure of the Isaias' group TV networks, which account for about 40 percent of the country's nightly news audience, were a purely financial move to sell the companies and use the proceeds to pay creditors, Correa would have asked an accounting firm to put an independent caretaker at their helm.

Instead, Correa named the head of Ecuador's government television station, Enrique Arosemena Robles, as the new head of the networks. And former Correa press aide Jose Toledo was appointed as the new vice president of news for the stations.

Worse, the owners of several of the television channels say they acquired the stations from the Isaias brothers several years ago and have nothing to do with the Filanbanco scandal. Estefano Isaias, brother of Roberto and William, who faces no charges in the banking scandal in Ecuador, told me he bought TC-Television about 10 years ago. Similarly, Alvaro Dassum says he - and not the Isaias brothers - is the owner of Gamavision.

The Correa government will have to start legal proceedings to determine who are the real owners of the TV stations, which will take months, if not years. In the meantime, the government will control three new propaganda channels at a critical time, when Correa badly needs free advertising to win the upcoming constitutional referendum.

"The whole purpose of this was taking over the television stations, because Correa was going down in the polls and he needed to do something to boost support for a referendum that is losing public support," Estefano Isaias told me Wednesday.

On Monday, government regulators closed down Radio Sucre, a Guayaquil radio station that often criticizes the government, citing alleged technical irregularities with its license. Last year, Correa took control of El Telegrafo newspaper, which was involved in a major financial scandal.

But instead of selling it, he kept it and turned it into a government mouthpiece.

"These are very alarming signs for the future of press freedoms in Ecuador," Enrique Santos Calderon, a vice president of the Inter-American Press Association, told me in a telephone interview.

"It's no coincidence that all of this is happening shortly before the election campaign for the constitutional referendum, nor can it be seen as unrelated to the systematic attacks by Correa against media that criticize his government."

My opinion: I agree. Correa won the presidency on an anti-corruption, pro-democracy platform, but has turned into an arrogant autocrat who - like his close friend, Venezuela's Hugo Chavez - is silencing the opposition to pass a Constitution that suits his main goal: staying in power indefinitely.