28 Feb 2020
For two years federal investigators in Miami have patiently waited for reams of Swiss bank records to be turned over so they could bring a monumental money-laundering case against a wealthy circle of Venezuelan businessmen and ex-government officials.
Finally, those secret bank records have arrived, due to a major decision to release them by Switzerland’s highest court.
With that critical evidence in hand, U.S. prosecutors can now move forward and decide on filing a long-planned indictment charging four members of Venezuela’s young business elite — known as “boliburgueses” — and two former high-ranking officials in the government’s oil sector, along with a Swiss banker at the center of the alleged international money-laundering racket.
The business elites are suspected of paying hefty bribes to the government officials in exchange for making loans in bolivars to the national oil company, Petróleos de Venezuela, S.A., and then receiving repayments in dollars — with the proceeds washed through the government’s favorable currency-exchange system to magnify profits. The multibillion-dollar payouts were then diverted to secret Swiss bank accounts between 2012 and 2014, according to U.S. authorities.
“The operation, carried out thanks to acts of corruption, would have allowed the embezzlement of more than $4.5 billion, laundered mainly through accounts opened in Switzerland,” the Swiss Federal Tribunal wrote in a January order rejecting appeals seeking to stop the release of the bank records.
The majority of that tainted money was transferred into accounts held by Venezuelan bankers Luis and Ignacio Oberto at Compagnie Bancaire Helvetique, and the rest into their accounts at EFG Bank AG and seven other Swiss financial institutions in the sprawling fraud scheme, U.S. authorities say in official correspondence with their Swiss counterparts. The Miami Herald obtained copies of the “mutual legal assistance” letters summarizing the transactions.
The Justice Department’s $4.5 billion money-laundering investigation is the largest of three distinct Miami-based probes targeting Venezuelan “kleptocrats” and their associates, resulting in the prosecution of a dozen defendants in South Florida so far — including a former national treasurer, Alejandro Andrade, who was the first to plead guilty in late 2017. The probes, which prosecutors say form a triangle of corruption connecting Venezuela to Switzerland to South Florida, dramatize the alleged theft of stratospheric sums of government funds in the oil-rich South American country. The high-level political corruption has spurred Venezuela’s economic collapse and the exodus of millions of its citizens.
The latest U.S. investigation, led by Homeland Security Investigations, has zeroed in on a half-dozen “targets” suspected of transferring embezzled Venezuelan government funds into bank accounts, real estate and other assets in Miami and New York, according to U.S. authorities. At the forefront are the Oberto brothers, scions of a prominent banking family who reside in the luxury Carillon high-rise overlooking Miami Beach. The Herald reported on their leading roles in the alleged money-laundering scheme in November.
Since that report, the Herald has learned the names of other targets: Venezuelan cousins Alejandro Betancourt and Francisco Convit, who respectively live in Spain and Venezuela. Convit was indicted as the lead defendant in a separate Venezuelan money-laundering case in Miami in 2018, while Betancourt is suspected of being a co-conspirator in that same case. He has not been charged.
Also being targeted in the latest probe: Rafael Ramirez, former president of the state-owned oil company, PDVSA, who now lives in Italy, and former Venezuelan Vice Minister of Energy Nervis Villalobos, who is in custody in Spain awaiting extradition to the United States on bribery charges in an unrelated PDVSA fraud case.
The Swiss banker in the middle of the alleged money-laundering scheme: Charles Henry De Beaumont, who was employed by Compagnie Bancaire Helvetique until 2012 and later became an independent asset manager conducting transactions with his former bank and others, according to law enforcement and legal sources familiar with the U.S. investigation. De Beaumont collected $22 million in fees for his handling of the allegedly illicit transactions for the Obertos, Betancourt, Convit and others, and he also used some of that money to buy luxury residences in the Dominican Republic and in the Continuum condo high-rise in Miami Beach.
In 2018, the U.S. Department of Justice, along with the U.S. Attorney’s Office in Miami, sought Switzerland’s legal assistance with the investigation under a treaty agreement, requesting account records at Compagnie Bancaire Helvetique and other Swiss financial institutions such as EFG Bank, which by law manage wealthy clients’ money in total secrecy.
By requesting Switzerland’s assistance, the Justice Department was able to toll a five-year statute of limitations that could have impeded prosecutors’ efforts to bring money-laundering conspiracy charges against the Obertos and the others. In other words, the formal request for the Swiss bank records — crucial to filing an indictment — bought prosecutors time to make their case.
The Oberto brothers, along with the cousins Betancourt and Convit, are suspected of paying huge bribes to the two former Venezuelan government officials, allowing the businessmen to make loans in bolivars to the national oil company and receive payments in dollars between 2012 and 2014. Both the loan and bribery payments were laundered through Swiss and American bank accounts, U.S. authorities say.
By Jay Weaver and Antonio Maria Delgado, Miami Herald, 26 February 2020
Read more at Miami Herald
RiskScreen: Eliminating Financial Crime with Smart Technology
Advance your CPD minutes for this content, by signing up and using the CPD WalletFREE CPD Wallet