According to the Mexican newspaper El Universal, relying on information supplied by the Arcadia Foundation, Hondutel's revenue decreased 47% between 2005 and 2006, the first year of President Manuel Zelaya's administration, despite Hondutel's monopoly on international calls In April 2009, Latin Node Inc., an American company, pleaded guilty to making improper payments to Hondutel, "knowing that some, or all of those funds, would be passed on as bribes to officials of Hondutel". Chimirri resigned in 2007, and was arrested following the coup. He remains in prison on charges of abuse of authority and embezzlement, charges he denies. Apart from Chimirri, Oscar Danilo Santos (the former manager of Hondutel), Jorge Rosa, and James Lagos are all charged in connection with allegedly committing crimes of abuse of authority, fraud and bribery having received bribes of $1.09 million U.S. from an international carrier in exchange for Hondutel providing that carrier lower rates than other firms. Auditor Julio Daniel Flores was charged for the lesser crime of violation of duties of officers.
President Zelaya came to international attention in June 2009 when he was overthrown in a military coup and forced into exile. The crisis that led to his removal from office centered around the question of whether changes would be made to the 1982 Honduran Constitution. Zelaya proposed a national poll to gauge interest in constitutional change, which provoked a fierce reaction from opposition parties. Those responsible for the coup justified their actions on the grounds that Zelaya's interest in potentially convening a constituent assembly to draft a new constitution was illegal, and alleged that his real motive was to increase his time in office. Zelaya denied that his motive was to stay in office, stating that he intended to step down in January 2010 as scheduled, noting that his successor would be elected at the same time the vote on whether to convene a constituent assembly would occur.
The Supreme Court's ruling was supported by Congress, the country's attorney general, top electoral body, and the country's human rights ombudsman, who all said that Zelaya violated the law. Despite the opposition of the other branches of the government, Zelaya moved forward with his plan to hold the poll on 28 June 2009. In Honduras the military assist with election logistics; So in late May 2009, Zelaya requested military help to distribute ballot boxes and other materials for the poll. The chief of the military, General Romeo Vásquez Velásquez, refused to carry this order out. In response, Zelaya dismissed Vásquez on 24 May. Subsequently, defense minister Edmundo Orellana and several other military commanders resigned in support of Vásquez. Both the Honduran Supreme Court and the Honduran Congress deemed the dismissal of Velásquez unlawful.
The Congress, the attorney general, and the top electoral tribunal declared Zelaya's proposed referendum illegal. Congress began to discuss impeaching Zelaya. On 27 June and again on 30 June 2009, thousands of protesters opposed to Zelaya's marched through the capital city.
On 28 June 2009, the Supreme Court issued an order to detain President Zelaya, who was subsequently captured by the military. He was then brought to the air force base Hernan Acosta Mejia, and taken into exile in Costa Rica, precipitating the 2009 Honduran constitutional crisis.
On 21 September 2009, Zelaya and his wife arrived at the Brazilian embassy in Tegucigalpa. Zelaya said that to reach the embassy he travelled through mountains for fifteen hours, and took back roads to avoid checkpoints. Zelaya did not state from which country he entered Honduras. Hundreds of Zelaya's supporters surrounded the Brazilian embassy. Zelaya chanted "Restitution, Fatherland or Death!" to his supporters, raising fears that Zelaya was attempting a violent confrontation.
On 27 September 2009 Honduras gave Brazil a ten-day deadline. Brazilian President Luiz Inácio Lula da Silva replied that he would ignore the deadline. "Brazil will not comply with an ultimatum from a government of coup-mongers". Lula said. Honduran interim president Roberto Micheletti warned that his government would take action if Brazil did not determine Zelaya's status soon. President Lula requested an apology. Hundreds of Honduran soldiers and Police Officers surrounded the Brazilian embassy, where protests against the coup continued.
On 29 October 2009, the government of "de facto" president Roberto Micheletti signed what United States Secretary of State Hillary Clinton called a "historic agreement" to let Manuel Zelaya serve the remaining three months of his term. "If Congress agrees", according to Elisabeth Malkin of The New York Times, "control of the army would shift to the electoral court, and the presidential election set for 29 Nov. would be recognized by both sides. Neither Mr. Zelaya nor Mr. Micheletti will be candidates".
On 29 November 2009, a presidential election was held under a state of emergency declared in Decree PCM-M-030-2009. According to the decree, the Secretary of State of the 'de facto' government was expected to participate in the military command for this state of emergency. Five of the six presidential candidates retained their candidacies, while Carlos H. Reyes had withdrawn his candidacy on 9 November in protest at what he perceived as illegitimacy of the election. Zelaya called for a boycott of the poll. Some Hondurans interviewed by Associated Press said that they "sought to move past the crisis with the elections", which had been scheduled previous to Zelaya's removal. Early returns indicated that conservative Porfirio Lobo was elected with around 55% of the votes. Official numbers for the turnout of the election falsely placed it at around 60%, but subsequently revised the numbers to 49% turnout.