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Former President of Banco Industrial de Venezuela and Owner of Offshore Companies

Leonardo González Dellán headed Banco Industrial de Venezuela (BIV) from 2002 to 2004. The papers of Mossack Fonseca reveal that, in this period, which also coincided with the establishment of the exchange control and the birth of the extinct Cadivi, he was related to overseas companies.

08/05/2016 15:48:17

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On February 11, 2016, the history of Banco Industrial de Venezuela (BIV) ended. A resolution of the Superintendency of Banking Institutions (Sudeban) was the death certificate for a financial institution that was born in 1937.

"Agreeing the early dissolution of Banco Industrial de Venezuela, C.A. and the cessation of operations and financial intermediation activities and, thus, beginning the administrative liquidation process," provides Article 1 of the measure contained in Official Gazette 40.846.

But the end of BIV was written long ago. In 2011, the Office of the Comptroller General of the Republic (CGR) recommended ending the "intervention process," which the bank was subject to since 2009. It advised its "liquidation" in “order to preserve the interests of the Republic, the stability of the national financial system, and the rights of savers, depositors, customers and creditors, given that the bank had serious economic, financial and budget planning problems in 2007 and 2008."

Major losses, interventions and bailouts from the Government every so often were constant in the bank. The red figures were also part of the bad management and the permanent turnover of BIV’s board. In the first eight years of Hugo Chávez government, the bank had up to eight presidents.

One of them was Leonardo González Dellán, who, based on the papers of the Panamanian law firm Mossack Fonseca, is the beneficiary of several companies in tax havens. González Dellán was appointed by Chávez to head BIV in 2002 and held office until 2004, when he was replaced by Arné Chacón, the brother of former minister Jesse Chacón, who was arrested in 2009 in connection with the financial crisis that year.

The documents of Mossack Fonseca law firm, which Süddeutsche Zeitung of Munich received from an anonymous source and were reviewed by a team of over 370 journalists around the world under the coordination of the International Consortium of Investigative Journalists (ICIJ), prove that González Dellán was linked to offshore companies since he was at the head of BIV.

Route to Panama

An email between executives of the Panamanian law firm dated April 4, 2013, leaves no doubt about the client. "In the Supreme Court of Justice of Venezuela there is a document in which Leonardo González Dellán acts as representative of Banco Industrial de Venezuela (BIV). This document indicates the full name and personal identification number that exactly matches the document of our director," the communication reads. It even details that "the contact of Leonardo González Dellán with Hugo Chávez was also found."

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After 79 years of activity, Banco Industrial de Venezuela was liquidated this year. Photo: Creative Commons

The first emails related to González Dellán go back to 2010, but the papers of the companies reveal that he was related to a company, whose settlement agent was Mossack Fonseca, since 2003.

The company is Blue Crest Holdings S.A., a company registered in Panama on August 20, 2003. "The authorized capital of the company is US $ 10,000, legal tender of the United States of America, divided into 100 shares that may be registered or bearer, at a par value of US $ 100 each. The board of directors may allow bearer certificates to be exchanged for certificates in the name of the owner and vice versa," reads the company's social agreement, a kind of articles of incorporation.

On August 21, 2003, four bearer certificates were issued, equal to one share each. On July 23, 2014, a fifth certificate for 100 shares was issued in favor of Leonardo González Dellán. But the relationship of the former president of BIV with company Blue Crest Holdings S.A. did not end there.

On October 20, 2003, the directors of Blue Crest Holdings S.A., appointed by Mossack Fonseca for that purpose, conferred José Ángel González Dellán a Power of Attorney to "manage the company without any limitation." He is the brother of the former president of BIV, who, based on the National Registry of Contractors (RNC), is the president of the Asociación Cooperativa Colosal XX, R.L., a company that has provided services to Petróleos de Venezuela (Pdvsa), as varied as the "supply of meals", "office construction and remodeling," and "road construction and signaling," among others.

Also on October 20, 2003, a Power of Attorney was issued in favor of Luis Alberto Benshimol, an investment advisor who was linked to several securities firms such as Lemon Casa de Bolsa in 2003 and later to Bencorp Casa de Bolsa C.A., one of the many intervened by the National Securities Commission in 2010, after the then Minister Jorge Giordani decided to finish with the sector.

As of July 21, 2005, Leonardo González Dellán had a Power of Attorney without limitations to manage Blue Crest Holdings S.A.

Foreign Exchange Control and Parallel Market

The period of González Dellán at the head of BIV coincides with the beginning of foreign exchange control decreed by Chávez in February 2003 and still in force, as well as with the origin of the extinct Currency Administration Commission (Cadivi). Several press releases from El Universal, published between 2003 and 2004 reveal BIV’s participation at that time.

On December 31, 2002, in the midst of the so-called "oil strike", Jesús Rodolfo Bermúdez, who was then Vice Minister of Finance, opened trusts in BIV to in the name of the Republic: one for 1,500 million dollars, through a promissory note at 18 months and a 14.5% rate, another for 700 million bolivars, and a third one for 1.413 million dollars.

According to the information at the time, the Ministry of Finance used that scheme to honor payment commitments to public entities and private companies, but "the promissory notes ended up injecting gas into the parallel currency market," El Universal reported on July 18, 2004. "In other cases, the companies demanded buyers, mainly banks and brokerage firms, to pay the promissory note at 100% of their face value, whereby financial institutions acquired US dollars at Bs. 1,600, exactly the price at which the Government gave foreign currency to the priority sectors of the economy in 2003," adds the release.

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Property deed of one of the companies registered in the Virgin Islands

El Nacional newspaper published in 2007 information about the management of BIV during the Chávez government, summarizing González Dellán's step through the institution as follows: "Leonardo González Dellán, close to Copei (political party), was appointed president of BIV in November of 2002, but he left in July of 2004. By then, the delinquency reached 49%."

In the book El gran saqueo (The great sacking) by Carlos Tablante and Marcos Tarre, Leonardo González Dellán is identified as one of the financial "operators" who benefited during the Chávez administration through securities negotiations and transactions that allowed them to take advantage of the "exchange differential". 

From Tax Havens to Earthly Heavens

Son of the former Copei-member senator, Eudoro González, and brother of the current deputy of Primero Justicia (political party), Eudoro González, Leonardo González Dellán met Chávez at the beginning of his government and ended up forming part of his government. The papers of Mossack Fonseca confirm that González Dellán's relationship with the law firm and the companies in tax havens did not end with Blue Crest Holdings S.A. In December 2010, representatives of J. A. Fernández y Asociados, another Panamanian law firm, representing the former president of BIV, contacted Mossack Fonseca to request information on the availability to "reserve" some companies.

"Regarding the company concerned, we confirm that the sole shareholder is Leonardo González Dellán. Therefore, we request you to prepare a share certificate for the entire share capital in favor of González Dellán," reads an email dated December 7, 2010, sent from J. A. Fernández y Asociados to executives of Mossack Fonseca. The company was Rodsal Company Limited, registered by Mossack Fonseca on August 5, 2010, in the British Virgin Islands. "The company is authorized to issue a maximum of 50,000 shares without par value of the same class of shares," established the register of the company, whose shareholder until July 2013 was Leonardo González Dellán. Previously, there was a change of directors and finally a certificate was issued with the 50 thousand shares in favor of Weltrust, a Swiss company, and the law firm Python & Peter became its settlement agent until the company was dissolved in November 2015. The documents of Mossack Fonseca prove that the former president of BIV also acquired in July 2011 company Gran Rex Alliance, registered in Panama on May 11, 2010, with an authorized capital of 10 thousand dollars, divided into 10 thousand shares of one dollar to bearer. In this case, the papers show that the Uruguayan law firm Estudio Posadas & Vecino Consultores Internacionales transferred to Mossack Fonseca all the documents related to the origin of the company. It was not possible to contact González Dellán for this work. Sources consulted indicate, however, that he lives in Europe. In 2012, celebrity magazines extensively reviewed his wedding in Las Vegas, USA, with the former miss and Venezuelan model, Aida Yéspica. The articles refer to the former president of BIV as a "Venezuelan lawyer" without major references, but they do show the photos of the marriage, as well as others disclosed by his wife in the social media, where they appear enjoying heavenly places like Saint Tropez, Balearic Islands, and Sicily.