By: Alek Boyd
Source: INFODIO
Alek Boyd
Yesterday, I had the opportunity to participate as an expert in a conference on corruption in Venezuela at the OAS. Such topics are rarely discussed in institutions of this kind. Although I wanted to be present, and was invited by the office of Secretary General Luis Almagro, I could not attend due to circumstances beyond my control. Below is a summary of my presentation titled “Origin and International Destination of Illicit Venezuelan Funds.”
When discussing the origin of illicit funds from Venezuela, all roads lead to PDVSA. As the country’s main industry and the practically sole source of foreign currency income, PDVSA is the source of nearly all corruption in Venezuela. I obtained the financial statements from PDVSA’s website (years 2001 – 2016) and performed several calculations: oil sales, net profit, costs, contributions to FONDEN, royalties, and more.
When we talk about corruption in Venezuela, it’s important to quantify and try to simplify the scale of the problem.
PDVSA’s Revenue Compared to Marshall Plan and TARP.
The blue line represents the Marshall Plan, an international aid program that helped rebuild 18 European countries after World War II. The cost of that program, adjusted for current dollars, was $100 billion.
The yellow line represents TARP, short for a financial aid program executed by the U.S. government to revive the country’s economy after the 2008 banking crisis. The cost of that program, also adjusted for current dollars, was about $450 billion.
Then we have PDVSA, highlighted in red under Rafael Ramirez, which received revenue from oil sales totaling $1.305 trillion between 2001 and 2016. We’re talking about trillions of dollars.
For those having difficulty comprehending these amounts:
– Europe was rebuilt with 100;
– The largest economy in the world was revived with 450;
– PDVSA collected 1.305, while people are starving in Venezuela.
This provides a simple outline of the scale of corruption in Venezuela. If we add the $180 billion of internal and external debt issued by the Chavismo during the same period of 2001 – 2016, we reach a total of $1.485 trillion. And if we consider the entire period of Chavismo in power from 1999 to present, the income is even greater.
Where is the money? Where did it go? Part of it is within the OAS itself, meaning in the coffers of some member countries. CARICOM is a group of Caribbean nations, many of which belong to PETROCARIBE: a supposedly cooperative program invented by Hugo Chavez around 2000. Since then, the cooperation has boiled down to: oil in exchange for votes (in the OAS), diplomatic favors, intelligence, advice, and elements of repression.
Jamaica owed PDVSA $3.2 billion; the Dominican Republic $4 billion. Instead of collecting every last cent considering the country’s dire situation, Chavismo decided to forgive half of the debt.
Cuba, the first member of PETROCARIBE, has been receiving unspecified amounts of oil since 2000. For example, between September 2017 and February 2018, PDVSA sent crude oil and other derivatives to Cuba (Cubametales) worth over $300 million. In December 2018 alone, more than one million barrels of crude, diesel, butane, and jet fuel were sent in six shipments, at an approximate cost exceeding $55 million. This happens while many Venezuelan children suffer from malnutrition.
Nicaragua, ruled by the brutal Daniel Ortega, received over $4 billion through PETROCARIBE, basically to buy the necessary toys to kill a people rebelling against rampant corruption and Ortega’s dictatorial government. Nearly 500 murders were financed with Venezuelan money.
Thus, it is necessary to indicate that some of the stolen money from Venezuela is spread across those nations whose only cooperation has been to prop up Chavismo, Castroism, and degenerates like Daniel Ortega.
We also have the U.S., a favored destination for the boliburguesía. An army of real estate advisors, bankers, lawyers, lobbyists, politicians, and public relations experts has ensured that those who have bankrupted Venezuela lead lives of the most obscene luxuries, accessing the best clubs, banks, and residences, all in plain sight without the authorities of that country questioning the origins of such wealth for many years. Bolichico Alejandro Betancourt acquired the Onassis penthouse through JP Morgan; Alejandro Andrade lived like a king while his son flaunted an influencer lifestyle for years without any scrutiny; Victor Vargas bought the most expensive mansion in Palm Beach; Coco Capriles has his family established there, just like the Oberto family, while the money launderer David Osío, a favorite of Chavismo, travels and lives freely in the U.S.
But it’s not only in the Americas that illicit funds from Venezuela are welcome. Spain, now rivaling the U.S. as a preferred destination, welcomes all boliburguesía and any chavista looking to clean their dirty money over there. Nervis Villalobos, Javier Alvarado, Luis Carlos de León, Rafael Reiter, Gustavo Mirabal, the Khalil brothers, Jesus Vidal Salazar, and Aaron Ortega, as well as the Neri Bonilla family, Juan Carlos Escotet, Victor Vargas, Coco Capriles, Axel Capriles, Miguel Angel Capriles Lopez, Moris Beracha, Alejandro Betancourt, and Pedro Trebbau are just a few of the well-known “Venezuelan entrepreneurs” whose “fortunes” are being laundered in Spain, in plain sight of everyone, without any issues.
Switzerland, which is not short on bankers willing to accept ill-gotten gains from Venezuela, has dealt with all of those mentioned. They all have accounts there. Venezuela was the country with the largest amount of money deposited in HSBC, over $11 billion, which Alejandro Andrade managed with complete discretion. The Oberto family received in the EFG bank, just in one month, $1 billion from PDVSA’s accounts in Espirito Santo of Portugal. More than double that amount went to Compagnie Bancaire Helvetique. The Derwick boys even set up their own bank (Credinvest), when they weren’t using Gazprombank for their illicit dealings.
Other European countries are involved to levels that are difficult to justify. Andorra, with a GDP of just over $3 billion, saw larger amounts in money laundering schemes from PDVSA pass through one of its banks (Banca Privada D’Andorra), involving Rafael Ramirez and almost his entire family and close collaborators. The same applies to Portugal. The United Kingdom was used by Samark Lopez and Tareck el Aissami to triangulate the acquisition of assets through frontmen, while lawyers and former police are deeply entwined in all kinds of schemes, as of today, with PDVSA.
Trillions of dollars allow for a lot. Corruption is, without any doubt, the cause of the humanitarian crisis, because if the funds had not been stolen, the country and all its inhabitants would be in a privileged situation. There’s no possible justification for Venezuela to be in its current state with such a level of income, regardless of costs that need to be subtracted. Colombia, the country with the highest number of displaced persons (7 million), has roughly double Venezuela’s figures, with Venezuelan emigrants deciding to leave since 2015, rather than after decades of armed conflicts with narcoterrorist groups.
Millions of Venezuelans are not leaving the country due to insecurity, a lack of justice, or democracy, but because of a lack of food, medicine, and basic supplies. Due to hunger. And this is directly and absolutely attributable to corruption.
Countries in the hemisphere must do more, much more, to prevent situations like Venezuela’s in the future. It is irresponsible to simply watch a country be looted to ruin and pretend that nothing is happening or excuse oneself with the absurd argument of non-interference. The exodus of millions of Venezuelans makes the problem global. All the corruption across the Americas does not compare to that of Venezuela. I would go as far as to say that there’s no similar case in the world to that of Venezuela/PDVSA.
Tags: Banca Privada Andorra, pdvsa corruption, Derwick Associates Corp, FONDEN, HSBC