Tuesday, November 22, 2011

Corrupt charity in the Caribbean

A mere 75 million USD, airplane not included

One does not know what to really make of Alek's latest findings.  In a time of financial crisis the Venezuelan government through its Central Bank (BCV) makes available to a third party in Britain of 2 billion dollars in bonds for charity purposes in the Caribbean.  What a sweet gesture you may say, but take a closer look....

The bond seems to be processed through an Isle of Man firm (tax heaven, by the way) whose declared values are a mere 2,000 pounds.  One pound supports 1 million dollars.  Surely there is something legal somewhere to justify that but at the very least the ethics are to be questioned.  I mean, a 2,000L company could well serve to finance, say, an industrial project worth a couple million dollars.  But a 2 billion bond issue?  Do 2,000L even manage to pay the computer and desk required to control the financing?

The next item to note is that a supposedly noted charity manager from England is the appointed person to fly across Central America and the Caribbean to spread the wealth is a Conservative Party guy, a certain Tony Caplin.  Well, being a conservative or labor or liberal is no guarantee of impartiality and honesty.  But let's not be petty.  I mean, is there no one in Venezuela able to disburse two billion dollars directly to charities?  Why must we use an intermediary that surely will cash something for his travails?  After years of Petrocaribe largesse we have no one that has bothered to know first hand the charitable necessities of CARICOM?

Oh dear!  Call me crazy but this smacks of two things: corruption and vote buying at the OAS in prevision of next year electoral fraud all but officially announced by Chavez.  I mean, will the prime minister of Banana Island will be able to vote against Chavez a few weeks after s/he received a fat check for a mere million?

Not to mention that Venezuelan hospitals and school could use a little bit of that charity.



This morning when I read first the news I was outraged more than anything else by the need to seek some Brit to do something that I could do myself for cheaper and better and less corrupt if Chavez were to call me (yes I would, if Chavez really wanted to do charity I would cooperate with him). Thus my text on this first impression, that we cannot even steal ourselves through charity...

The thing is that there is something rather fantastic about the whole scheme, from the amount to the purpose, almost as if it was done so that folks would get caught.  You now, like the Nigerian Prince dead father with a big inheritance that cannot be cashed scheme on spam.

Since it was a story by Alek who has hit a few good ones before and there is no reason for me to think he did not do his homework, I will let him bring further evidence as to its sustainability.

I prefer to make the following comment: after all the scandals from Pudreval to the FONDEN missing funds, we are now so blasé that we are willing to take at face value any of such schemes. Maybe the judicial system is so useless in Venezuela that now they do not care anymore as to people finding out; or maybe it is indeed someone making fun of us. Whatever it is, one thing is certain, it is a sad reflection on how degraded a society we are now.

[written at 7 PM the same day]


What do you know? I received a tip as to this thing from Miguel in the afternoon and wrote this caveat above when I reached home after work. A little bit later I do my evening survey of news and Miguel reports more work on it, and that his conclusion is that it was fake. Ill intentioned alright, but more than likely fake as far as the documents stand.  Though it may still be proven true, but that is up to Alek.

My caveat above thus still stands with the added warning that the corruption of the regime is making all sorts of shady practices float around, linked or not to the regime (just as Nigeria noted corruption created that spam industry around its prince and other victims of air plane crashes).

As for me, even if it comes from Alek, I will bite my keyboard for a few hours before transmitting the news.

We should also note that even if this particular "gift" is not true, the moneys given by the regime in the Caribbean over the last decade  are way higher in total.  What is a billion more between friends?

[written at 7:45 PM]


  1. Daniel, this is a scandal of monumental proportions. We know that Merentes et al are nothing but a bunch of crooks. But giving away, just like that, $2 billion, to a former COO of the Tory party -no less- who is FSA unregistered and has no track record anywhere beyond the City? To a £2,000 company?

    Vote buying in CARICOM of course. But still, that's just too much money. And this Caplin guy holds official positions within NHS, and other public institutions in this country, one of the even connected to HM Treasury. I hope UK authorities investigate this issue.

    Hasta cuando will Venezuela be the mine from where all world crooks steal fortunes?

  2. Island Canuck6:18 PM

    As Alek doesn't allow normal posting I will comment here.

    The first thing I notice is that there is no oversight for this huge amount of money. "...has transferred free & clear...".

    "The projects will need to be supervised by reliable local companies supervised by your team.."

    "...to be selected at your own discretion..."

    Wow! If this isn't a licence to steal then I've never seen anything that is.

    Does Venezuela have so much money that they can throw away $2 billion dollars without any supervision?? And why to the "imperio"?

    The whole thing stinks!

  3. Alguien que no se chupa el dedo...8:02 PM


    Using caribbean "charities" has been a well known money-laundering scheme.

    Normally it goes like this:

    - The "charity" transfers the money to XYZ island.
    - The "charity" starts construction of a school, hospital or church in XYZ island.
    - The money is funneled through bogus contractors, advisors, providers, through the years... (the building is finished or not, it is unconsequential)
    - The money is "clean" and ends up in corrupt or criminal hands.
    - The whole process costs 10-15% depending on the use of financial vehicles, the construction itself, etc.

    The reason why they use "charities" is that:
    1) some of them do real work in the islands, so it is more justifiable.
    2) the deal with a lot of cash (bills, coins), since they normally get money from churches, raffles, etc.
    3) their supposedly benign objective makes them fly under the radar of compliance officers and legal enforcement agencies.

    It is worth mentioning that "free of payment" bond deliveries are extremely rare and most times forbidden at serious institutions.

    That is why Pruitt & Pruitt (the accomplice law firm), presented a personal due dilligence report on this Caplin character. They probably used this to obtaina waiver to receive the bonds at Crédit Suisse.

    I am glad that there still are decent people at BCV or CS, and they made these documents public.

    This is more evidence to, eventually, bring to trial this criminal regime: Chávez, Merentes, Giordani, etc.

  4. Alguien que no se chupa el dedo8:18 PM

    By the way,

    They transferred the bonds instead of cash because these Eurobonds settle in Euroclear/Clearstream (Luxembourg and Brussels).

    So, no U.S. currency changed hands and by doing this they probably tried to keep the transaction away from FINCEN's and OFAC's reach.

    They think they are so smart... Even quoting the Vatican...

  5. Not to be too picky, but the Isle of Man isn't in the Caribbean. It is located in the Irish Sea between the islands of Great Britain and Ireland.

    Which doesn't alter one iota your point about this obvious fraud committed against the Venezuelan public.

  6. Daniel,

    Don't approve my previous post. I just re-read your and realized that you were not implying that the Isle of Man was Caribbean.

  7. They picked the Brit (could have been another nationality) over a Venezuelan because the foreigner can be "objective." When the Caribbean politician gets the check from him, it provides the fig leaf of neutrality which allows them to pretend it's not a Venezuelan bribe.

  8. I keep thinking about it, and this is utterly insane, even just on the surface. How can anyone possibly pretend this is on the up-and-up? Too many unnatural connections. For example, I have to wonder how they involved those attorneys in Alabama, of all places.

    Gotta love this phrase in the letter from the lawyers: "These efforts will enhance the quality of life for a tremendous number of individuals." No kidding.

  9. "..this is a scandal of monumental proportions. We know that Merentes et al are nothing but a bunch of crooks. But giving away, just like that, $2 billion..,"

    - Unfortunately, for the majority of Venezuelans, the uneducated and those who do not read these blogs or some fancy paper analysis -- this won't be any 'scandal' and will fly under the radar, as always in our history of Grand Theft. Do we even dream 5% of our pueblo even begins to understand the intricacies of such international financial acrobatics? Hell, they don't even see when pink elephants disappear from the room every day, every week, every year.

    - Now who's gonna get that 2 billion, or most of it? 20 crooks, 40 criminals? Or split the profits between a couple hundred, between politicians, Chavez and his family, Banco Central thiefs, etc.. ? That's what we'll probably never know. Heck, Carlos Andres or many Russian mafia moguls have pulled bigger heists than that and died free and peacefully.

    And of course, our new buddy Dieguito Arria cannot put up a claim in the UN, the FMI, or some Prague International Court of Crimes about such 2 billion juicy maneuvers, can he? Who would pay for the investigations, and who would be black-mailed or lynched, in the process?

    Then again, stealing such grotesque sums of money from any country really amounts to murder; it's an obscure form of genocide: all the people who could have gotten medical attention, clean water, new jobs, etc, etc, pay a very serious price, ultimately with their lives.

  10. Anonymous1:56 AM

    I actually find it hard to believe that any lawyer within the state of Alabama would actually work on a scheme such as this. After doing a bit of research about this law firm, it is clear that he is into numerous practice areas of American Law. However, even the richest and most prominent corporate CEOs and such (many who have happened to be in trial here in the state of Alabama for embezzlement and fraud) don't even recruit lawyers from the state in which they live. They aren't even on the client list. But hey, I could be wrong...maybe they have some connection with one of these clients.

  11. plob5002:21 AM

    Where did these "documents" come from? The amount of money involved and the people involved in the UK makes it all seem just a bit over the top. Maybe just another "red herring"??????

  12. Daniel, I have no reason to doubt the source. As per the documents, before posting, I did do due diligence, and checked whether the company existed in Isle of Man, whether the bond appeared in Euroclear Bank, etc.

    What I could double check I did, and came out reasonably satisfied as per the veracity of it.

    Now Miguel says it's a fake, fishy. Well of course it is. As I said to a journo from a rather important outlet yesterday, however way you cut this is dodgy.

    If it is a scam from Merentes and BCV, it is extremely grave. If it is a scam from Kellmar / Caplin, it is also grave as it involves forging official documents and signatures.

    Miguel's argument that this was done by a third party, to damage whatever reputation Tony Caplin may have, that one I am not too keen on.

    But today, phone calls to different actors will be made, and sooner or later we will find out. In the meantime, I am not retracting from anything, until I see evidence to prove otherwise.

  13. glenn5:40 PM

    Daniel- a "tax haven" is a "tax heaven" so I suppose you were not entirely wrong in your writing :)


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