Venezuela Scandal Grows as Ex-PDVSA Finance Chief Pleads
(Bloomberg) -- The U.S. money-laundering scandal involving $1.2 billion stolen from Venezuela’s state-owned oil producer expanded with the guilty plea of the company’s former executive director of financial planning, who’s helping prosecutors investigating Venezuelan President Nicolas Maduro and others.
Abraham Edgardo Ortega, 51, admitted Wednesday in federal court in Miami that he took $17 million in cash bribes and that he conspired to launder money looted from Petroleos de Venezuela S.A., known as PDVSA. Ortega is one of nine people charged by U.S. prosecutors since July, and he’s the second to admit guilt and cooperate. On Monday, Matthias Krull, a former Swiss banker at Julius Baer, was sentenced to 10 years in prison.
Ortega admitted Wednesday in a court document filed as part of his guilty plea to conspiring with others “to launder and engage in monetary transactions with the proceeds of corrupt currency exchange schemes involving PDVSA.”
Ortega, who worked at PDVSA from 2004 until March 2016, said he used his position to profit from companies that had trouble receiving payments from the company. After the 2008 financial crisis, he said, he received a total of $5 million from separate joint ventures that PDVSA formed with a French oil company and a Russian bank.
He also admitted taking a $12 million bribe through a loan and foreign-exchange contract. Ortega laundered that money through a false-investment scheme. Ortega agreed to forfeit at least $12 million in cash, as well as accounts in New Jersey, Switzerland and the Bahamas.
U.S. prosecutors say that professional launderers worked for years to hide the movement of money stolen through bribery and fraud from PDVSA, Venezuela’s primary source of income and foreign currency. Venezuela, once a prosperous OPEC nation, is undergoing one of the worst economic crises ever, with inflation forecast to reach 1 million percent this year.
The U.S. has sanctioned at least 48 Venezuelan nationals associated with corruption, and it’s barred purchases of debt owed to Venezuela, including PDVSA. Fourteen people have also pleaded guilty as part of a separate U.S. probe, based in Houston, into bribery at PDVSA and other oil companies.
In Miami, prosecutors are investigating Maduro, his three stepsons and Raul Gorrin, owner of the Globovision television network in Venezuela, a person familiar with the matter has said.
Ortega was initially charged in July with joining conspirators who enriched themselves by exploiting the difference between the fixed official exchange rates in Venezuela and the street value of the currency. Prosecutors say that in 2014 an individual could exchange $10 million on the black market for 600 million Bolivars. If the individual had access to the government’s official rate, the 600 million Bolivars could then be exchanged for $100 million.
“Essentially, in two transactions, that person could buy $100 million for $10 million,” prosecutors said in the court filing.
A complaint by Homeland Security Investigations, a unit of U.S. Immigration and Customs Enforcement, alleged that money launderers then used phony loan contracts and other fake business documents to fool banks about the true source of their money.
Ortega, a Venezuelan national, first appeared in federal court in Miami on Sept. 12, when his bail was set at $1 million. He was arraigned Tuesday and entered a plea of not guilty before U.S. District Judge Kathleen Williams -- a formality before his guilty plea on Wednesday.
Williams set a tentative sentencing date of Jan. 9.
The case is U.S. v. Guruceaga, 18-cr-20685, U.S. District Court, Southern District of Florida (Miami).
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