Imagine being Víctor Vargas and waking up to read an article in Bloomberg Week stating that your bank has assets worth $19.3 billion, while in reality, your bank’s assets are only $2.4 billion. Now, think about being Juan Carlos Escotet, who, after deceiving everyone in a tough bidding process that led to an acquisition in Europe, finds out that people took his claims of wealth at face value without questioning them.
It’s hard to grasp what is happening to good journalism these days in newsrooms staffed by individuals who should know better. And even in official scrutiny. The fact is that we are witnessing a troubling trend. Oligarchs are quickly engaging in “Slimification” (the process by which well-connected individuals legitimize their ill-gotten wealth in the developed world) without issues. Of course, money has no smell and no enemies these days. Unfortunately, money laundering from corruption robs the future of millions in developing countries.
Now, just imagine what could be done in a place like Venezuela if all the capital that has been siphoned out of the country had been invested and retained there. Bloomberg Week quoted a trusted man of Vargas (Diego Lepage) claiming that Vargas’ bank employs 15,000 people in Venezuela. How many more could have been hired if Vargas had invested all his ill-gotten wealth in Venezuela? How many additional jobs could Juan Carlos Escotet have created if he had chosen to invest his “billions” at home instead of in Spain?
It’s painful to witness these bullies conducting their international business as if they are reputable and honorable captains of industry. As if they have truly created wealth, rather than stolen it. We are not talking about types like Steve Jobs here, because the defining characteristic of the entire boliburguesía is their ability to exploit Venezuela’s mercantilism. That’s it. There is no wealth creation, only sponsorship. Given the Venezuelan state’s control over the country’s oil and income, what we have is a “business class” shaped by post-Perestroika Russia, getting their official accomplices to grant them access to vast amounts of public funds without any supervision or transparent bidding. Any fool can make a fortune playing with state resources.
The cliché that Víctor Vargas has been rich all his life, or that Juan Carlos Escotet is a reincarnated Rockefeller, doesn’t hold water. Amoral opportunism is what defines them. Time and again they have bitten the hand that feeds them. It’s also incorrect to claim that they built their fortunes from scratch (Vargas riding the Santaella wave and Escotet on Orlando Castro’s coattails). When the Spanish media, or even Bloomberg, publish the fictitious exchange rate of $1 = 6.3 BsF as legitimate, the chances for accountability take another hit. For example, things would have looked very different had Spanish and EU authorities evaluated Escotet’s offer for Novagalicia using the real SICAD 2 rate of $1 = 49.97 BsF, instead of the unattainable $1 = 6.3 BsF. Had that rate been applied to Escotet, his bank’s assets wouldn’t be “35 billion dollars,” but rather about 4.8 billion dollars. The same applies to the $19.3 billion in assets Bloomberg Week assigned to Vargas’ BOD.
Years ago, there was a joke in some Caracas circles about Gustavo Cisneros‘ annual tantrum over Forbes’ underestimation of his fortune. Vargas and Escotet aren’t experiencing that, right? Still, we must ask ourselves what kind of games are being played behind the scenes. Recently, El Universal (Venezuela’s oldest newspaper) was sold to a shady Spanish company for €3,500, whose sole shareholder didn’t even know they were involved in the business. Interestingly, Escotet’s Banesco is part of that network. Before that, Cadena Capriles (the largest newspaper conglomerate in Venezuela) was sold to Hanson Asset Management, a small English firm. In this case, Vargas’ aides and bank were involved. Current Venezuelan legislation explicitly prohibits foreign ownership of Spanish-language printed newspapers, or even the involvement of banks/bankers in the media. Yet, those irresponsibly attributing the size of these fortunes don’t seem interested in reporting on illegal acquisitions of major media.
So, why do oligarchs get a free pass?