While the network developed and grew to handle millions of barrels of crude oil and thousands of tons of other goods, the mystery also persisted as to how much of it was known to the Mexican government of Andrés Manuel López Obrador, and whether it had his approval. The Financial Intelligence Unit (UIF) began an investigation a year ago into some of those involved, but no further progress has been made in the Mexican justice system. The agency’s action was not only insufficient but came too late, just when Washington was ready to impose financial sanctions against Joaquín Leal and other protagonists of the business. 

However, an investigation by EL PAÍS and Armando.info, based on thousands of internal documents of the network, found evidence that at least one instance of the Mexican government could have acted as an ally of the network. As per papers of company Libre Abordo, it portrayed itself as a company designated by the Mexican government to carry out this type of transactions, and as a client of Segalmex —the food security agency of the Mexican State.

In addition, documents in possession of both media and interviews with several sources confirm a relationship between young businessman Joaquín Leal – at the apex of the plot – and the Undersecretary of Foreign Affairs for Latin America and the Caribbean, Maximiliano Reyes Zúñiga. The number two of the Foreign Ministry says in his defense that, as part of his responsibility, it is essential to support “every Mexican company, regardless of its name, regardless of its political or partisan position.” “We assume that the businessmen who approach us do so in good faith and wish to have better economic ties in the region,” adds Reyes in response to this report. 

“Libre Abordo was appointed by the Mexican government to join the humanitarian oil-for-food exchange program with Venezuela for the purpose of selling a variety of foodstuffs to be traded between both countries,” the company assures in a corporate presentation prepared in January 2020, which is part of the documents in the hands of both media. In the presentation, the company created ad hoc by Joaquín Leal for business transactions with Venezuela, explains that the agreement was conceived in a series of bilateral conversations between Caracas and Mexico City authorities.

All Aboard

The same presentation indicates that Libre Abordo reached an agreement with Segalmex, the government agency for food production and distribution. “Segalmex receives instructions from the federal government of Mexico to continue with the humanitarian aid, aiming to benefit the people of Mexico and Venezuela,” the document reads. According to Libre Abordo’s version, Andrés Manuel López Obrador’s administration instructed Segalmex to sell 210,000 tons of corn to Libre Abordo, destined for Venezuela. The amount coincides with the operation that Libre Abordo carried out in June 2019 with the state-owned Corporación Venezolana de Comercio Exterior (Corpovex). Two contracts were signed to supply those tons of corn and 1,000 tankers of drinking water in exchange for two million barrels of oil ⸺a two hundred-million euro operation.

Another document from the electronic file obtained for this journalistic investigation adds up. In the search for clients willing to process the PDVSA oil that had been exchanged for food, in early 2020, Libre Abordo contacted Reliance, the Indian refinery. Apropos of the due diligence process initiated by the Asian company to certify its prospective new supplier, Libre Abordo submitted a letter dated December 16, 2019, with the letterhead of Segalmex, the agency that was to sell to this company the corn intended for Venezuela. “We hereby confirm that we have received instructions from the Mexican government to proceed with this deal,” reads the missive that bears the purported signature of Segalmex’s then head of Administration and Finance, René Gavira. “The corn will be distributed in three deliveries scheduled for the third week of January 2020, the third week of February and the third week of March.” Sources close to the former official, who left office in June last year tangled up in corruption accusations, assure that the signature on the letter is not Gavira’s and claim that it was forged by Leal and his collaborators.

Libre Abordo also submitted proof of a bank transfer of December 11, 2019 to Segalmex for 330.6 million pesos ($15 million), as an advance for the delivery of the 210,000 tons of corn of the initial operation. The company that made the payment was Consorcio Panamericano SA de CV, a Mexican company in which Leal’s grandmother is a partner along with alleged front men, who participated in other entities of the businessman. Libre Abordo assured in the emails sent to Reliance that Consorcio Panamericano granted them a “loan” to complete the transaction. When ask on this matter for this report, Segalmex answered that it “will not comment” on the alleged transaction.

Those initial two million barrels negotiated in June 2019 turned to be at least 30 million barrels of crude oil in shipments that sailed between November 2019 and May 2020. According to emails in the possession of EL PAÍS and Armando.info, Libre Abordo explained that the jump from two to 30 million barrels was due to the international fall in the price of crude oil, since the equivalence of the exchanged goods had changed to the detriment of the Venezuelan party. The Mexican company sought advice from law firms to complete the operations through bartering under the guise of “humanitarian aid.”

The transaction, which included corn and tanker trucks in exchange for Venezuelan crude oil, undertook to alleviate the misfortunes of the regime in Caracas. Pressured by the U.S. sanctions imposed on some of its top officials and agencies, such as the state oil company PDVSA and the Central Bank of Venezuela, the Maduro government was facing more and more difficulties to place its dwindling crude oil production in international markets and obtain foreign currency. A professed humanitarian swap seemed to provide a convincing enough façade for the transaction to pass Washington’s scrutiny.

Despite the schemes, in the end, the U.S. Department of the Treasury sanctioned Libre Abordo and Joaquín Leal for doing business with Venezuela, a measure announced a year ago, in June 2020. At that point, the Mexican FIU started an investigation to follow the trail of the 200 million euros. The investigation made little progress until last May 18, when the FIU filed a complaint to the Attorney General’s Office requesting the seizure of a hundred or so accounts of Leal and Libre Abordo, as confirmed in this investigation. However, to date, there has not been any official pronouncement about the alleged agreements with Segalmex.

Real Link

Two testimonials sources assured the authors of this investigation that Maximiliano Reyes Zúñiga, the number two of the Mexican Foreign Ministry, enabled the approach between Leal and Segalmex in 2019. As these sources confirmed, the first contacts took place at a meeting in Monterrey, capital of the State of Nuevo León, with senior officials of the Venezuelan government, who visited Mexico and proposed to open a channel of institutional communication between the two administrations. That meeting was held shortly after the visit to Caracas of a group of Mexican businessmen, including José Adolfo Murat, Leal’s former partner. Then, based on the documentation obtained, there was a meeting with Omar Abou Nassif, brother of a businessman close to Venezuelan Vice President Delcy Rodríguez, who raised the possibility of using the Chihuahua branch of Industrias Lácteas Asturianas (ILA, producer of the Reny Picot brand) as a supplier in Mexico. Sources close to Segalmex confirmed this information. 

In the course of this investigative series, of which this report is a part, Joaquín Leal and the Venezuelan government were requested to give their versions, but no request received a response. 

The Administration of Andrés Manuel López Obrador, of the National Renewal Movement (Movimiento de Renovación Nacional – Morena), although leftist, has maintained an ambiguous position regarding the Venezuelan conflict since he came to power. He certainly avoided recognizing the opposition leader and president of the National Assembly, Juan Guaidó, as interim president, something that pleased Maduro, but at the same time he has helped to bring Venezuelan opponents out to give them asylum in Mexico. The relations of the Chavista government and the Venezuelan opposition with the Mexican diplomacy are close and frequent, to the point that Mexico is emerging as the prospective venue for an upcoming negotiation between both parties to seek a way out of the political and humanitarian crisis that has become chronic in the South American country. As to President López Obrador, who does not hold back his opinion on all kinds of matters at his morning conferences, has referred to Venezuela on very few occasions. Three days before the U.S. Treasury sanctioned the Mexican businessmen, he said that he would be willing to collaborate with humanitarian aid if the government of Caracas required it. “It (the Venezuelan government) has not made any request to us. But if it made a request pertaining a humanitarian need, we would act on it.”

Mexico did not need to have a leftist government to act as one of the apexes of a surreptitious trade scheme with the Chavista Venezuela. Already in 2016, under the administration of Enrique Peña Nieto, of the once hegemonic Institutional Revolutionary Party (Partido Revolucionario Institucional – PRI), businessmen close to Nicolás Maduro, such as Alex Saab, found in Mexico the suppliers to buy tons of food that were sent to Venezuela in the CLAP boxes. In 2018, the then authorities of the Office of Mexico’s Attorney General opened an investigation against that business —virtually on the eve of the elections won by López Obrador— for finding evidence of poor quality products and overpricing in the shipments. However, the case resulted in only small fines for the companies involved. 

But the potential involvement of a government entity and the fact that a senior Foreign Affairs official, Maximiliano Reyes Zúñiga, was aware of –or perhaps even promoted- the business scheme, would assign an unprecedented level of commitment by the Mexican government. 

Even though no other evidence has been found to confirm the link with Segalmex, there is no doubt about the relationship between Joaquín Leal —the young entrepreneur who took over the reins of the circuit from Mexico to evade international sanctions against the Chavista regime— and the number two of the Mexican Foreign Ministry, the Undersecretary (Vice Minister) of Foreign Affairs for Latin America and the Caribbean, Maximiliano Reyes Zúñiga. Leal and Reyes met at least twice in two restaurants in Mexico City before the deal between company Libre Abordo and Corpovex was closed, as the reporters confirmed with three different sources.

A Venezuelan Woman with Dual Loyalty

Those meetings set a public precedent pertaining the ties between Leal and Reyes, due to a column by Carlos Loret de Mola in the Mexico City newspaper, El Universal. The influential Mexican journalist brought into the open a letter, dated June 20, 2019, less than a week after the contracts between Libre Abordo and Corpovex were signed. The letter was to the attention of the Venezuelan government, where a Venezuelan, Haymel Brito Martínez, appears as a member of the Mexican delegation to the 49th General Assembly of the Organization of American States (OAS), held in those days in Medellín, Colombia. Haymel Brito was the only participant of the Mexican delegation headed by Reyes, who did not hold a high diplomatic position. In his column, Loret de Mola described Brito as “an influential woman in the Mexican Foreign Ministry” and wondered how it was possible that a diplomatic official “representing two countries” simultaneously, Mexico and the United Arab Emirates, could have been born “in another country,” Venezuela. After the spreading of the letter, the Ministry of Foreign Affairs (MFA) decided to leave Brito out of the delegation. Facing at least two requests for information, the Foreign Ministry denied that the woman worked at the Undersecretariat for Latin America. Nor does she appear in the directory as a fee-for-service employee of that office.

Based on her curriculum vitae, Brito Martínez has been a representative of Fedecámaras – Venezuela’s main business union –, analyst of the International Organization of Employers, intern at the United Nations, and has worked for the office of the ambassador of the United Arab Emirates in Mexico. It was during that stage of service for the Arab country, in late 2018, when the first meeting between Brito and Reyes took place, as at least two sources affirmed.

During the transition period from the government of Enrique Peña Nieto to that of Andrés Manuel López Obrador, in September 2018, the former mayor of Mexico City, Marcelo Ebrard, visited the UAE Embassy, as appointed foreign ministry. He was accompanied by part of his team, including the current undersecretary for Latin America and the Caribbean, Reyes Zúñiga. Soon after, Reyes and Brito began to actively interact on the social media and traveled together to different places, like Panama City, Buenos Aires and Barcelona, as this investigation has been able to verify.

Haymel Brito’s personal relationship with Joaquín Leal is also a fact, as evidenced by photos and messages on social media of her together with the closest entourage of the Mexican businessman. In July 2019, Brito began working as a director of Institutional Relations for Hábitos Luzy, the Mexican subsidiary of Luzy Technologies, one of the companies that were blacklisted by the U.S. Department of the Treasury along with Libre Abordo, and also part of Leal’s portfolio. The company specialized in health and food, and its most noticeable product was a mobile application to provide medical advice. From her position at Luzy, Brito managed the sale of medicines and medical equipment to the Panamanian government, directly supported by the Mexican Embassy in the Central American country.

On December 10, 2019, Maximiliano Reyes Zúñiga traveled to Buenos Aires to represent Mexico at the inauguration of Argentine President Alberto Fernández. According to transparency records, on that trip, the undersecretary made a stop in Panama to “hold meetings at the Mexican Embassy.” That same day, Brito shared on her social media pages that she was in Panama. Based on the emails, she visited the Mexican Embassy during that trip to discuss trade agreements between Luzy and the Panamanian government. In late 2019, the Mexican ambassador to Panama, Luis Manuel López Moreno, began to report his progress on behalf of the company to the Venezuelan woman, whom he called “master.” “We will meet before Friday to talk about the [Luzy] application. I will let you know as soon as I have an outcome,” the ambassador wrote to Brito in an email on December 16 about a meeting he had with a businessman, just a week after the visit. “Very well, ambassador,” she replied.

In a written response for this investigation, Venezuelan Haymel Brito assures that her “external advisory services” to Hábitos Luzy concluded in 2019 “and that had nothing to do with Venezuela or affairs in that country (...) I have no relationship with any Mexican government institution.” She adds that she learned about Libre Abordo through the publications of EL PAÍS newspaper in 2020, “when I was no longer there” [at Luzy].

Reyes’ Man in Caracas

The shadow of the Foreign Ministry over the Venezuelan oil scheme also extends to the Mexican Embassy in Caracas, especially with Reyes’ right-hand man in that delegation —Rodrigo Benedith Reyes. Both officials have known each other for at least a decade, when the now deputy foreign minister was a legislator in the Mexico City Assembly in 2009 for the Democratic Revolution Party (Partido de la Revolución Democrática – PRD, a leftist political party from which López Obrador and Morena broke away in September 2012) and the other was an advisor to the legislature. They also worked together as area directors in the Miguel Hidalgo borough (municipality) of Mexico City from 2012 to 2013. In September 2019, Benedith held the position of director of Urban Services of the Mayor’s Office of Azcapotzalco – another metropolitan municipality – when he was appointed, without any experience in the diplomatic sector, to be in charge of the economic cooperation and promotion of the Mexican representation in Venezuela. His name appears in the emails of Leal’s circle, who also boasted of having “contacts in Embassies and consulates.”

In an email that Joaquín Leal sent to his team on September 12, 2019, when the official had just arrived in office, the businessman asks them to send Benedith some cards and a contract.

The name of the Mexican official also appears in other communications. As in one dated April 1, 2020, in which the director of Libre Abordo, Olga María Zepeda Esparza, sends an email to the Mexican Embassy in Caracas informing his agreements with PDVSA. “We would like to give you some context related to our work as a Mexican company that provides humanitarian aid in Venezuela in exchange for oil,” reads the message, addressed to Benedith Reyes.

For this investigation, the reporters sent a detailed questionnaire to Maximiliano Reyes Zúñiga with ten questions on each of these specific issues. The undersecretary agreed to answer but with a general statement of nine paragraphs on the powers and objectives of his office, without confirming or denying anything. 

“As undersecretary for Latin America and the Caribbean, my responsibility is to be in permanent contact with all the governments of the region, based on the criteria set forth by the Mexican Constitution, which have always been publicly stated. Our principle is the utmost respect for the sovereignty of each country, and as far as possible, we are always willing to cooperate and collaborate in social, economic, cultural, humanitarian and commercial matters. And in this regard, we do not make exceptions with any government nor do we submit ourselves to the foreign policy of any country,” assures Reyes in his answer, who claims that he works “in favor of a solid and fluid dialogue with the private sector to improve the economic and commercial dynamics of our country in the region.” 

In this sense, Reyes assures that for his Undersecretariat (ministry division) “it is essential to support every Mexican company, regardless of its name, regardless of its political or partisan position. We assume that the businessmen who approach us do so in good faith and wish to have better economic ties in the region, based on a fundamental principle: win-win-win (Mexico wins, the country concerned wins, the businessman wins). In light of this, we have productive relations with many Mexican and foreign companies that fortunately see us as allies to facilitate their expansion, in the same way that other governments do with their companies.” Regarding the U.S. sanctions imposed on Libre Abordo and Leal, Reyes said, “Our line is public. We will never agree to solve anything through force or coercion, nor through sanctions. Our position is public and evident. We have always voted the same way in international organizations.”

Finally, regarding him knowing Joaquín Leal, he affirms that he “knew” the businessman together with “a group of Mexican and foreign investors in the energy sector, with whom I have had no contact for several months, before the sanctions were made public. My talks with them where about the same as with many other economic and business environments.”

* This is the second installment of the series “Mexican Bypass against the Sanctions” that Armando.info produced and publishes jointly with the newspaper El País of Madrid.

Since mid-2019, Alex Saab —detained in Cape Verde on June 12, 2020, and indicted on money laundering charges by a Miami court, where he could be extradited— and Joaquín Leal controlled a good part of PDVSA’s production with the marketing of crude oil through Mexican company Libre Abordo. Consequently, last year, the U.S. Department of the Treasury included the Mexican businessman in the so-called Clinton List of the OFAC (Office of Foreign Assets Control of the Department of the Treasury), where Saab and his partner, Álvaro Pulido Vargas, were listed since mid-2019. Along with that core oil operation, Saab and Leal expanded their lineup of Venezuelan products by incorporating coal from Zulia.

Soot Trace

A presidential decree published in Official Gazette No. 41.472 of August 31, 2018, announced the creation of the “joint venture” between state-owned Carbones del Zulia (Carbozulia) and the unknown Turkish company, Glenmore Proje Insaat. That authorization by Nicolás Maduro displaced the 2017-alliance between Colombian-Panamanian Inter American Coal and Carbozulia to make way for Alex Saab as a partner of the Venezuelan State. The Colombian businessman remained in the shadows, as in most of his activities with chavismo, but his collaborators appeared in the documents of the companies created ad hoc for the occasion.

The trace left in the articles of incorporation of Glenmore Proje Insaat leads to Lorenzo Antonelli, a 28-year-old Italian young man, director of several companies devised by the Colombian businessman and, more importantly, his brother-in-law. The company also has legal status in the United Kingdom, where Antonelli was a director. The scheme repeated the pattern followed with gold, where Antonelli was hidden behind another Turkish company that teamed up with Minerven when the state-owned company was already run by Adrián Perdomo Mata, a former employee of Saab and Pulido.

Antonelli’s ties to the business dealings of the businessman arrested a year ago in Cape Verde have been revealed in police investigations, like the one carried out by the Italian Guardia Di Finanza, which linked him and Saab’s wife to possible money laundering operations.

For the coal business, Glenmore’s attempt was only the first step. Joaquin Leal and his operations in Mexico completed the circle. That country had already served as a base for Alex Saab and Álvaro Pulido’s business, at least since 2016. From there, they bought and shipped thousands of CLAP boxes with poor quality food for Maduro’s regime after guaranteeing themselves millionaire contracts through companies from Hong Kong, first, and then from Turkey and the United Arab Emirates. In October 2018, the then Attorney General’s Office in Mexico confirmed the irregularities in the business and opened an investigation against several of those companies, but they finally got off with minor fines. So that this precedent did not inhibit them from adopting Mexico again as a base for their venture with Venezuelan coal.

Once Alex Saab’s relationship with Joaquín Leal was consolidated, the business in Mexico multiplied. The success of the duo can be measured by the sudden rise in 2019 of Venezuelan coal exports, which had been sluggish for years.

Aztec Empire —with a Hint of Greek and Colombian

“I am writing you to establish a first contact and make us known as a company. We have managed to gain access to a very high-level coal source and I would like to make ourselves available to offer you a first trial shipment.” So begins an email sent on April 3, 2020 from Imperium DMCC to several prospective customers for the purchase of the mineral.

Imperium DMCC was registered in 2018, in Dubai, one of the United Arab Emirates. Although it has Gyagkos Stylianou, a Greek, and Omeros Nishiotis, a Cypriot, as directors, it is actually another company of Joaquin Leal’s extensive portfolio. With this company, the team of the Mexican businessman and Alex Saab negotiated in May of last year the arrival in Venezuela of at least five ships of Iranian gasoline, and also sought to bring foodstuffs from Mexico. In communications obtained by Armando.Info and EL PAÍS, Imperium DMCC acts as a trader of the Venezuelan coal.

“This week, we finished loading the first spot cargo of 30,000 MT with the following specifications attached. This is the first cargo of a 3,080,000 MT +/- 3% forward contract,” continued that April 3, 2020 email. That contract alone far exceeded the 80,000 MT that Carbozulia produced in 2018, as company’s workers reported at that time. Four days before that email, the Venezuelan customs agency published on Twitter that they were carrying out the “recognition” of 41,000 tons of coal that would be exported, precisely from the “dock of Carbozulia.”

Any doubts that potential clients might have about the origin of the coal were cleared up in an email sent on May 25, 2020, addressed to the authorities of the port of Lázaro Cárdenas, on the Mexican Pacific coast. “We have a contract for 3 million tons with Carbozulia, 120,000 MT of which were already exported to Altamira [another Mexican port], sold on a spot basis to CFE (...) We would be very interested in taking our product to the TPP terminal in Lázaro Cárdenas to store it there temporarily and enable the sale operation to CFE from this point.”

The email also included the technical specifications of the product taken from the Paso Diablo mine, exploited by Carbozulia. Although in that communication it was assured that Imperium DMCC had already sold 120,000 tons to the Mexican Federal Electricity Commission (CFE) and that Joaquín Leal had experience in the Mexican electricity market, there are no indications that those deals have materialized.

Instead, the communications and documents reviewed jointly by Armando.Info and EL PAÍS reveal the pressure to try to sell and store the coal assigned to Leal.

In addition to Mexico, Leal’s team sought to place the mineral in Guatemala, Honduras and the Dominican Republic. In no case is there evidence that the attempts were successful. As recorded in hundreds of emails, the coal was offered to companies, such as Trafigura, a global commodities trading giant with headquarters in Geneva and Singapore; or BB Energy, a Lebanese consortium that appears in the Mossack Fonseca documents contained in the so-called Panama Papers for managing an offshore company in the isthmus that traded millions of dollars of Russian oil in Latin America during the nineties.

In some communications, Imperium DMCC claims to act on behalf of Mexican company Suministradora Bennu. Enrique Woodhouse, the owner of Bennu, explained for this article that Joaquín Leal asked his company to receive the coal on consignment, imported from Venezuela free of charge, until the deal with the Mexican state electricity company CFE could be closed. But the origin of the goods, according to the shipping documents, was not Carbozulia, but Glenmore, the Turkish company behind which is Alex Saab’s brother-in-law, Lorenzo Antonelli.

The link of Imperium DMCC, Leal’s trading company, with Alex Saab was also evidenced in writing in the company’s exchanges. “We cannot carry on this cooperation with Alex Sabb [sic],” reads one of the emails that the Liberian-flagged Ceto Shipping sent to the company, in that case, after more than 100 days of disagreements over the payment of one of the fuel cargoes from Iran. This dispute was reviewed last year by Bloomberg agency.

The business explains the rebound in Venezuela’s coal exports, which in 2019 accounted for some US$ 40 million, as Reuters reviewed. In 2020, the figures soared higher —one destination alone, the United Kingdom, received 460,000 tons of the Venezuelan mineral, valued at US$ 46 million, while almost 220,000 tons arrived in Spain for US$ 23 million, according to United Nations trade statistics.

Alex was Axel

All the e-mails sent by Imperium DMCC, offering the Venezuelan coal, bear the signature of Alex Rodríguez, a relatively common combination of first and last name in Spanish and the namesake of the former Major League Baseball player, a star of the New York Yankees, among other teams. But there is a code that makes it possible to decipher that the sender adopted a pseudonym, as at the time he played with anagrams. In the communications, the name was almost always accompanied by a telephone number that, in reality, matches that of Axel Galit Capriles Hernández, a young Venezuelan businessman with experience as a commodities broker and son of the well-known psychologist, Axel Capriles Méndez, who in recent years has been involved in the real estate business in Madrid.

That telephone number is the same one that Armando.info called months ago to contact Axel Capriles Hernández (junior) before the publication of a first report on his connection with Joaquín Leal. Just as on that occasion he declined to comment, this time he did not respond to a request for an interview to clarify the use of the pseudonym Alex or other aspects of his relationship with Joaquín Leal.

In a communication sent to the authors after the publication of this report, Axel Capriles — through his lawyer in Madrid, Efrén Díaz— denies that he is actually Alex Rodríguez or that he has ever used such a pseudonym.

Before signing Imperium DMCC’s communications, that name and alleged alias of Alex Rodriguez already appeared in 2019 as a trader of Libre Abordo, the Mexican company that negotiated tanker trucks and corn in bulk with the state-owned Corpovex in exchange for Venezuelan oil, and which in June 2020 triggered the sanctions by the Department of the Treasury against Joaquin Leal for considering him as the head of a scheme to evade sanctions against PDVSA, imposed in early 2019.

On one occasion, the mask of the pseudonym was uncovered by the interlocutors. That email claiming the failure to pay, sent by the shipping company, Ceto Shipping, to Imperium DMCC was precisely addressed to “Axel G”.

The Venezuelan businessman’s lawyer, Efrén Díaz, acting as his spokesman in a written letter, insists that the inclusion of Axel Capriles’ name in that email was a “mistake,” but fails to provide proofs to support this statement. According to the lawyer, the confusion arose “because a wrong email was mistakenly sent to Mr. Capriles Hernandez, an email which he never had access to nor was he aware of it.”

The partnership of Axel Capriles with Joaquín Leal has been confirmed – for some time now – in companies like Generadora de Electricidad y Gas in Mexico, registered in Guanajuato, capital city of the state with the same name in central Mexico.  His lawyer acknowledges from Madrid the partnership between Capriles and Leal, but points out that it was “a brief association” in that electricity company, which did not prosper in the end, and “the legal issues” of Joaquín Leal “accelerated the early closing of the project.”  

Sources familiar with Joaquín Leal’s business dealings, as well as the role that Axel Capriles Junior played in Mexico, confirm that Alex Rodríguez was a pseudonym of the young Venezuelan. “Axel’s nickname is Alex Rodríguez. He used a fake WhatsApp account for his conversations with PDVSA,” states a businessman, who prefers anonymity.

Those versions are also denied by lawyer Efrén Díaz, representative of Axel Capriles Hernández.  “Mr. Capriles Hernández has never participated in any oil or coal process, negotiation, project or scheme nor with the persons mentioned.”

After the sanctions of Donald Trump’s administration against Joaquín Leal, Axel Capriles’ trace in Mexico vanished. The telephone number provided in the emails with the name of Alex Rodriguez seems to be inactive. In digital media in Spain, there have been recent statements by Capriles Hernández promoting Totam Technologies Inc, a mobile payment application in gas stations.

The platform belongs to Totam Servicios Tecnológicos, a company registered by Axel Capriles in Monterrey, in May 2019, when he was also a trader of Venezuelan coal in the scheme devised by Alex Saab and Joaquín Leal to evade U.S. sanctions against the Chavista regime. 

* This is the third installment of the series "Mexican Bypass against Sanctions" that Armando.info produced and publishes jointly with the newspaper EL PAÍS of Madrid.

NOTE TO READERS. During the reporting process of this article, the editors tried to get Axel Capriles Hernández’s version, among that of others mentioned, but he did not respond to the journalistic requests. Only after the piece was published, Mr. Capriles Hernandez’s lawyer in Spain sent a letter to the editors of EL PAÍS and Armando.info with some comments regarding the article and his version of the matters in which he is mentioned. For the sake of a more comprehensive understanding of the story and, in accordance with the ethical standards of both publications, some quotes from that letter were added to the original text, quotes included in the section under the crossheading “Alex was Axel.”

As gathered from a large file of documents, jointly obtained and processed by the Spanish newspaper EL PAÍS and Armando.info, which has given rise to this series of investigative reports entitled “Mexican Bypass against Sanctions,” a company unknown in the raw material production business, called Consorcio Panamericano de Exportación (Copaex), proposed to the presidency of CVG a plan to “reactivate the aluminum industry in Venezuela.”

The project with CVG was another idea of Mexican businessman Joaquín Leal Jiménez, an ally of Alex Saab in Mexico, who activated a secret network for the trading of Venezuelan commodities designed from an original request of Venezuelan Vice President Delcy Rodríguez to solve the inconveniences generated by the national 5-day blackout, in March 2019. By a subtle irony, it was precisely that electricity crisis what condemned the state-owned aluminum industry to inoperability… the electricity from Guayana —a Venezuelan region south of the Orinoco River, rich in minerals and water flows— until then abundant, continuous and inexpensive, is one of the essential supplies for this industry to produce. To concentrate aluminum in its cells, Alcasa and Venalum, the two CVG companies engaged in the aluminum market, require around 1,500 megawatts per day.

The blackout represented the coup de grace for an industrial park that in March 2019 reached a production equal to barely 10 percent of its installed capacity. It was the end of a decline that began in 2010, when the late former President Hugo Chávez ordered the aluminum industry to shut down in order to save electric power during the first great crisis of the electric utility, officially blamed on that year’s drought and the drop of the level of the Guri dam, on the upper Caroní River, in the State of Bolívar, one of the three rivers —together with Delta Amacuro and Amazonas— of the Guayana region. If the production of this conglomerate of mineral processing companies has never been the same since then, after the 2019 blackout, it fell to zero.

A Blessing for Leal’s sake

The debacle, however, looked like a business opportunity for Leal, who was a rising star in Mexico, as a businessman in the electricity sector. He saw within reach the possibility of adding another Venezuelan raw material to his portfolio of products for the global market.

Through the unknown Copaex, he proposed to the Venezuelan counterpart to make a one-off US$ 300-million investment to supply and transport “gas-based power generation plants of 200-MV capacity” which, together with an alliance with the Venezuelan state-owned Corporación Eléctrica Nacional (Corpoelec), would be enough to activate within nine months 125 out of the 905 aluminum cells paralyzed since the blackout of March 2019.

After one more year, according to the document addressed with much familiarity to “Pedro,” referring to Pedro Maldonado, president of CVG and trusted man of Vice President of Economy Tarek El Aissami, Leal and Copaex estimated that all the cells could already be active.

“Copaex will send power generating plants to Venezuela as of July 2019, and expects to complete the installed capacity of 200 MW within the next 12 months. With the 16 MV, it is estimated that 10 cells will be reactivated with a production of 510 tons per month. To start with the production, it is required to enter into a cooperation agreement by and between Venalum and Copaex, where the contributions of the parties and their benefit will be determined,” reads the proposal in an optimistic tone, dated June 10, 2019.

While in the letter addressed to the president of CVG, the Mexican company assured that it was solely motivated to submit the proposal due to its “commitment to the industrial development of Venezuela,” and highlighted that Leal had accumulated experience in the electricity business, the plan fell short when it came to envisioning the eventual rescue of the Venezuelan aluminum industry.

The business proposal acknowledged that at least 1,448 megawatts of generation would be needed to activate all the aluminum cells, but did not disclose whether the new added capacity was part of the proposed agreement or how many power generation plants it entailed. In fact, it ended up explicitly assigning to the state-owned Corpoelec the responsibility of generating and supplying some 1,250 megawatts of the required capacity from the planned Tocoma hydroelectric plant on the lower Caroní River, which never went on stream despite the state’s injection of nearly US$ 10 billion. However, it does make it clear that Copaex’s services would be paid “in kind with produced aluminum.”

Resuscitation maneuver

The bet on aluminum was a maneuver that Leal attempted to channel income towards the aforementioned Consorcio Panamericano de Exportación (Copaex), created as a variable stock corporation in 1998, but finally registered in the Mexican state of Guanajuato in 2017, with a very broad corporate object, slightly inclined to livestock or agricultural activity. The company was not created by Leal, who later acquired it through relatives.

The company was registered with a capital of 50,000 Mexican pesos and with three members on its board of directors, until August 2019, when its initial corporate purpose —also very broad but now with some ambition in the field of food and oil trading— was modified, and the three directors who were on record at its creation were removed from their positions giving way to two new members, María Guadalupe Villanueva Ayala and Francisco González Ramírez. Ramírez was the signatory of the proposal to CVG, as president of the Consortium, which, based on the dates, he had just joined.

At an Extraordinary Meeting held in October 2019, the company took another turn with the increase of capital from 50,000 to 100,000 Mexican pesos (from US$ 2,500 to US$ 4,500) and the inclusion of a new board member, María Teresa Alfaro Castañeda, Joaquín Leal’s grandmother, which ratifies a common practice in Leal’s companies —he does not appear in the articles of incorporation of the companies, but his relatives.

Three months after that modification, the company made a transfer with a check for 15 million dollars to another company of Leal’s scheme, Libre Abordo, which it gave in turn to the state-owned Seguridad Alimentaria Mexicana (Segalmex) as part of the payment for 210,000 tons of white corn that would eventually be exchanged for oil in Venezuela. This was one of the first moves of a sophisticated corporate structure, in which Alex Saab also participated to obtain resources in exchange for oil and thus evade U.S. sanctions. Then came the control of coal, the interest in collecting remittances from Venezuelans abroad, and aluminum.

A year after that signature, which meant the entry of Leal’s relatives in Copaex, in March 2020, the “variable” capital stock of the company dramatically increased to 100 million pesos (a little more than five million dollars); it multiplied by 1,000. The two former shareholders resigned, as per the minutes to which EL PAÍS and Armando.info have had access, and Leal’s grandmother is joined by a new partner, Carlota Leal Jiménez, Joaquín’s sister, with a minimum 0.5-percent share.

While Copaex was trying to close the deal with CVG, it also offered to place a shipment of 180,000 tons of coal in Central American ports, specifically in Guatemala, for a value of 12.3 million dollars. This sales proposal had much clearer technical specifications than the proposal to reactivate aluminum. Although nowhere it is stated in the document that the coal was of Venezuelan origin, by that time, the network of Leal and Saab was managing the coal exports of the state-owned Carbozulia.

There is no indication that the business proposed by Consorcio Panamericano de Exportación had materialized. Reactivating Alcasa and Venalum with a 200-megawatt gas plant is virtually impossible. An engineer with over 20 years of experience in the aluminum industry, who prefers to keep his name confidential, explains, at the request of the reporters, what is really needed for this basic company to resume operations. “The total energy requirement for a 100 percent production of the aluminum industry is around 1,800 to 2,000 megawatts, equivalent to 18 or 20 percent of the capacity of Guri, with a total capacity of 10,300 megawatts. It is not possible to talk about package power plants of this size or about sectioned plants that are gradually added. It is necessary to have a highly reliable dedicated system, which would require a large investment or the recovery of the national interconnected system within a clear balance strategy between the consumption of the industry and that of the rest of the country.”

On the other hand, the improvised scheme seemed to be a great deal for businessman Joaquín Leal. What began under the guise of a “humanitarian exchange” of oil for goods, ended up opening a source of Venezuelan raw material to feed his energy business in Mexico, as he once envision, or to resell it in a hungry global market, just before the outbreak of the pandemic, for goods like oil, coal and aluminum.

Although it has not been possible to confirm the official story with the governments of Caracas and Bissau, sources contacted this week in a collaborative report between the Expresso newspaper from Lisbon and Armando.info gave versions that allow outlining the unusual reasons for the aircraft’s flight from the Caribbean to West Africa. 

Sending the plane to Bissau, the capital of Guinea-Bissau, was part of a desperate attempt by Nicolas Maduro to learn about the situation of Alex Saab - his alleged front man and confirmed trader - in the neighboring Cape Verde archipelago, where he has been held since June 12, after his arrest by Interpol, and to assess a possible rescue. 

Both Cape Verde and Guinea-Bissau are Portuguese-speaking nations in West Africa, former colonies of the Iberian country.

Saab and his partner, fellow Colombian Alvaro Pulido Vargas, are facing money-laundering charges in the federal court of the Southern District of the State of Florida, made in July 2019. The United States requested an Interpol red notice to be issued because of this accusation, which led to Saab’s arrest as soon as he landed at the Amilcar Cabral International Airport on Sal, one of Cape Verde’s islands. Now, Washington is requesting his extradition through a legal process that could stretch out for up to 65 days before a decision is made.Saab and Pulido Vargas ―the latter, allegedly hiding in Caracas - were sanctioned by the U.S. Department of Justice in the summer of 2019 for profiting from corruption in the business of the so-called Clap boxes, and it is not ruled out that they could be prosecuted in other U.S. jurisdictions for their participation in that business and in the illegal trade of Venezuelan gold to countries like Turkey. In Colombia, there is an arrest warrant for Saab. In Mexico, the authorities of the Financial Intelligence Unit have announced an investigation into the web of complicity that the Colombian business duo weave in that country in the development of the food supply business for the CLAPs. While it is known that the justice system of UK is also showing an interest in them.

However, the major trophy for the Western intelligence services is not the eventual prosecution of Saab, but the information he certainly has on how Maduro’s inner circle and businesses work. His testimony could help decode the scheme that still oxygenates the finances of pro-Chavez leaders and give them a lethal blow. That is why the Venezuelan government is also moving with unusual urgency and emphasis to free Saab from his imprisonment and bring him back to Caracas, something that has become a priority for Chavismo. 

In a first official reaction, Venezuelan Foreign Minister Jorge Arreaza affirmed in a statement that Saab was on a humanitarian and commercial mission as an “agent of the Bolivarian Government” for which he had a diplomatic passport and immunity. He then sent two letters to the president of Cape Verde, Jorge Carlos Fonseca. The African leader admitted in recent days, in a declaration of calculated naivety, that he did not remember ever having received so many calls from foreign governments as it happened since the arrest of Alex Saab, and described the case as “sensitive” for the justice system of his country because of the interests involved. But while that was happening in the formal channels of diplomacy, Caracas began to make other arrangements. The flight of PDVSA’s airplane YV2486 was part of those arrangements. In January of the current year, the plane was included in the sanctions list of OFAC, of the U.S. Department of the Treasury, as one of the aircraft on which Chavista leaders travel. Its route through the Cape Verde archipelago appeared on flight tracking websites and sparked rumors on social media. 

A Fleet to the Rescue

On June 26, PDVSA’s Falcon landed at Osvaldo Vieira International Airport in Bissau, in African land, about 1200 km (746 mi) from the prison of Saint Vincent, the island of Cape Verde to which Saab was transferred after his arrest on the island of Sal. According to sources linked to local authorities, the flight crew and the passengers did not go through immigration or to the city. Hence, they were not identified. 

During their stay in Bissau, from June 26 to at least June 30, the occupants of the plane stayed in a military facility, on the north side of the airport. The information states that the group included special operations agents.

Before landing in Bissau, the plane had been in Cuba for several days. Sources contacted by Armando.info said that the presence of Cuban intelligence agents among the passengers on that flight possibly indicates that the group’s mission was to assess the potential rescue of Saab. According to this version, the flight also carried valuables to pay bribes.

Another source in Caracas has a different version. The aircraft was carrying a group of ambassadors and diplomatic personnel, including a special envoy from Maduro. If that were the case, it is difficult to understand why the passengers were confined to military facilities at Bissau’s Osvaldo Vieira airport for four days, instead of making arrangements directly in Cape Verde.

After its long journey, the PDVSA plane with registration number YV2486 finally returned to Maiquetia International Airport from Senegal, on July 5, coincidentally, the day of the independence of Venezuela and Cape Verde.

The sources in Guinea-Bissau contacted by Expresso said that the PDVSA executive jet was joined by another aircraft on the mission. It was an Airbus A330-323X with Russian registration that had been parked for two weeks at the airport in the Guinean capital. A ship that was anchored near Soga―one of the islands of the Bijagós archipelago in the south of the country―was also part of the operation.

Although registered under the name of I-Fly, a small Russian airline founded in 2009 with a fleet of nine airplanes, the twin-engine Airbus A330 had been recently acquired by Turkish investors, but this could not be confirmed. Its crew and passengers were also not identified by Immigration officials at Osvaldo Vieira Airport. On July 7, the plane flew from Bissau to Caracas and from there, just two days later, to Moscow. Then, two days later, it flew to China and landed in the now renowned city of Wuhan, where the Covid-19 pandemic began earlier this year.

A source affirmed to Armando.info that Mike Pompeo, the U.S. Secretary of State, spoke directly with the Prime Minister of Cape Verde, Ulisses Correia e Silva, to inform him of the movements of the Venezuelan jet and offer him military equipment to reinforce the surveillance of the Saint Vincent prison. The journalist for Expresso learned that special force commandos were sent to that island to prevent a possible escape. Finally, Saab was again moved to Sal Island. While Saab’s extradition process continues to be in the hands of a local court, sources in Cape Verde assume that the ruling is likely to favor U.S.’s request.

Meanwhile, in Guinea-Bissau, neither President Umaro Sissoco Embaló nor spokespersons of his Government have taken a position on the issue. However, Expresso learned that the head of state personally called a local journalist who had published some articles on the matter in the international press, and threatened him, “Be careful. My information services are monitoring you. They told me that you are investigating the Russian and Venezuelan airplane issue.”

Several international organizations consider the political situation in Guinea-Bissau very sensitive. So far, Embaló has not given in to the request of the Economic Community of West African States (ECOWAS) to form by May 22 - more than a month ago - a new government that respects the result of the 2019 parliamentary elections, in which the opposition party PAIGC (African Party for the Independence of Guinea and Cape Verde) ―a movement of Marxist-Moscow origin founded in 1956 by the legendary Cape Verdean leader Amilcar Cabral― was victorious.

On this Sunday, July 12, it would be a month since Alex Saab was detained in faraway Cape Verde, where the plane that was taking him to Iran to continue his business with Chavism landed on a technical stopover, which now seems to have no end.  

* This report is the result of a joint coverage between the ‘Expresso’ newspaper from Lisbon and Armando.info in Caracas and Bogota. 

Mexican authorities are investigating the operations of Saab and Pulido since 2018, at the end of the administration of former president Enrique Peña Nieto. Although at the time they made accusations against the scheme developed by the Colombian businessmen, everything was diluted in a bureaucratic limbo. But the shake-up caused by the arrest of Alex Saab, now makes it possible to reveal the weaknesses of that investigation, which in practice, did not only absolve Saab’s and Pulido’s companies, but also the Mexican suppliers who shipped to Venezuela products of very low nutritional quality.

The behind-the-scenes of that process is a story of omissions and silences that shows how Mexican and Venezuelan authorities knew for months about the poor quality of the merchandise, but did nothing to stop that questionable trade and even relieved those responsible of any punishment. 

On October 18, 2018, the Attorney General’s Office of Mexico, reported through Israel Lira - the deputy attorney general specialized in organized crime investigation - that food exports to Venezuela were being made through a “fraudulent scheme” with “unusual operations” and “low quality” products with “overpricing.”

The official pointed directly at Group Grand Limited, the Hong Kong-based shell company that Saab and Pulido control, and a company with the same name in Mexico, run by relatives and operators of the Colombian tandem, as well as the network of suppliers with which they entered into contracts. Despite the seriousness of the allegations and some initial measures, like the freezing of bank accounts, the same official opened the door to a “reparatory agreement” with those involved, by way of compensation.

“The accused will hand over to the United Nations High Commissioner for Refugees (UNHCR) the amount of three million dollars, approximately 56 million pesos, which will be allocated to maintain the mandate of UNHCR in Latin America and the Caribbean,” Lira said at the time.

The shadow of the irregularity always surrounded that “reparatory agreement,” and the amount of the penalty seemed ridiculous for a business where hundreds of millions of dollars had been moved. Today, Santiago Nieto, head of Mexico’s Financial Intelligence Unit (FIU), describes it as an “unusual event.”

“The businessmen and individuals charged made a reparatory agreement with the Attorney General’s Office that is illegal, because despite the existence of an irregularity of 156 million dollars, they were imposed a donation of only three million dollars (...) Instead of this money being deposited in an account of the Treasury of the Federation (Tesofe), as it happens in this type of cases, it went to the office of the United Nations High Commissioner for Refugees (UNHCR). We already reported this to the Ministry of Public Administration and to the Prosecutor’s Office,” Nieto explained to Claudia Solera, a reporter of the Excelsior daily newspaper in Mexico City and coauthor of this report.

Other documents prove the illegality and the flaws of the agreement with the companies operated by Alex Saab and Alvaro Pulido, as well as their Mexican suppliers.

Confirmed Suspicions

By the time the Mexican Attorney General’s Office made both the complaint and the corresponding “reparatory agreement” public, there was plenty of evidence about the anomalies and the actors around the export scheme. Armando.Info had revealed the participation of Saab and Pulido in Group Grand Limited and, in February 2018, documented the poor nutritional quality of the Mexican milk powder that arrived with the CLAP boxes through a laboratory analysis of samples of the different brands of milk, conducted by the Institute of Food Science and Technology of Universidad Central de Venezuela (UCV).

Shortly thereafter, the Venezuelan state-owned company Corpovex, in charge of centralizing public imports, asked the Mexican companies to comply with sanitary registries. The Venezuelan prosecutor in exile, Luisa Ortega Diaz, had said in August 2017 that Group Grand Limited “presumably belongs to the president of the Republic,” referring to Maduro.

It is now known that the investigation that led to that pronouncement by Mexican authorities in October 2018, began in June of that year. At that time, the Financial Intelligence Unit filed complaint DEN-UIF-40-2018 to the Mexican Attorney General’s Office and the Ministry of Public Administration.

In addition to Group Grand Limited, the company controlled by Alex Saab and Alvaro Pulido, the brief listed Mexican companies, such as, El Sardinero, Deshidratados Alimenticios e Industriales (DAI), Empresas Bonobox, Jaifar Comercial, Grupo Brandon, Rice & Beans and Productos Serel. The list also included Asasi Food FZC, a company registered in the United Arab Emirates and also used by Saab and Pulido, and 4PL Industrial, a Colombian company that provides logistics and product packaging for the Claps, also linked to the Saab-Pulido duo. The complaint also included the names of Mexican businessmen Jaime Garcia and Raphael Jihad El Khoury Karam.

In April 2018, days before the disputed presidential election in which Maduro secured re-election, owners and executives of these companies had met with Alvaro Pulido Vargas at Madrid’s luxurious Hotel Villa Magna to expedite the deal. Suspicions against Group Grand Limited forced the Colombian businessmen to replace that company with Asasi Food FZC, registered in the United Arab Emirates―whereby they obtained a contract for 345 million Euros in 2018―and Mulberry Proje Yatirim, a Turkish company.

Indeed, in a letter dated April 2018, Group Grand Limited proposed to Corpovex - the state-owned company that signed the contracts with Claps intermediaries - the “transfer of the financial rights corresponding to contract CPVX-CJ-CONT-0086-2017” to the Turkish company Mulberry Proje Yatirim. This agreement amounted to almost 426 million dollars and was the second one achieved by Group Grand Limited for the Claps. The first one, for 340 million dollars, was signed in late 2016 through the State Government of Tachira, with Jose Vielma Mora in office.

Group Grand Limited, as well as Asasi Food FZC and Mulberry Proje Yatirim, in addition to Alex Saab and Alvaro Pulido themselves, were sanctioned by the U.S. Department of the Treasury in July 2019. “Several companies Saab and Pulido own or control were used in Saab and Pulido’s food corruption scheme,” the Treasury said in a statement. 

Almost simultaneously, a Florida state court charged them for money laundering in connection with the first deal they struck with Chavismo in 2011 for the construction of prefabricated homes.

But authorities in Mexico, contrary to those in the United States, did not criminalize Saab’s and Pulido’s scheme. They simply opened the door to “reparatory agreements” that seem to be custom-made for the offenders.

For months, company El Sardinero was the main supplier of the Clap boxes that left the port of Veracruz in Mexico to the port of La Guaira, on the vessels named CNP Paita and Viking Merlin. Rice & Beans and Productos Serel also supplied their products, such as rice and lentils, while Grupo Brandon, a company with a very diffuse trace in the state of Nuevo Leon, virtually monopolized the shipments of milk powder with different brands of very poor nutritional quality.

Four Pats on the Back

The first reparatory agreement was completed on October 12, 2018. Each representative of El Sardinero, Delmar Logistica, Almacenes Vaca and Rice & Beans paid $ 750,000 for a total of $3 million that would go to UNHCR, announced by the Attorney General’s Office of Mexico a few days later. In addition, they promised to hand over to the authorities 1,300 containers with about two million Clap combos.

Santiago Nieto, current head of Mexico’s Financial Intelligence Unit, highlights several flaws in the resolution. “First, these three million dollars should not have been deposited to the UNHCR, as a penalty, but to the Tesofe, as provided for in the Code of Criminal Procedures in the event of a reparatory agreement. It should be so by law. It is also illegal to agree the confiscation of 1,300 containers, later sent to Venezuela, when one of the irregularities had been indeed the acquisition of these low quality nutritional foods.”

The businessmen, for their part, claim to have complied with the authorities’ demands at the time. For instance, regarding El Sardinero, they insist that they honored the “reparatory agreement,” as they paid the donation, paralyzed their business with Venezuela and delivered the two million Clap boxes to the Mexican Foreign Ministry.

But that was not the only “reparatory agreement.” On October 16, 2018, the Attorney General’s Office of Mexico agreed with representatives of the Kosmos group ―the products of which, namely Productos Serel and La Cosmopolitana, were also included in the Claps― to impose a fine of just $120,000, which they also had to pay to UNHCR. For example, Kosland milk powder was one of the products of Productos Serel and among those with the worst nutritional values. The penalty is insignificant considering that, according to the Mexican Financial Intelligence Unit, Productos Serel sold merchandise for several million dollars to Wellsford Trading Corp, another intermediary contracted by the Maduro government.

Wellsford Trading Corp, registered in Panama, signed on March 30, 2017, contract 0032 for almost $70 million with the state-owned Corpovex. 

A third “reparatory agreement" was sealed on October 26, 2018. It was agreed upon with company Almacenes Vaca, on which a fine of just over 14 million pesos was imposed, equivalent to some $700,000, also payable to UNHCR. The owner of this company also owns Rice & Beans, another of the main Clap suppliers from 2017 to 2018. Just a single invoice of July 2018 shows that Rice & Beans charged Mulberry Proje Yatirim - the Turkish company, whereby Alex Saab and Alvaro Pulido replaced Group Grand Limited - $220,000 dollars for products.

The fourth “reparatory agreement” was signed on November 21, 2018. In this case, the authorities agreed a fine of $110,000 with the representative of companies Jaifar Comercial, Delmar Logistica and Empresas Bonobox, which at some point participated in the logistics for the Clap from Mexico.

But if the criteria of the “reparatory agreements” are now questioned by the head of the Mexican Financial Intelligence Unit, even stranger is that Group Grand Limited, the company used in Mexico by Alex Saab and Alvaro Pulido, has managed to recover their bank accounts after authorities ordered to freeze them. 

Two years after the investigation started in Mexico, only three companies remain blocked in the financial system of that country: Grupo Brandon, Group Grand Limited Hong Kong and Group Grand Limited Mexico. However, the company managed by Saab and Pulido won in November 2019 an injunction against the Financial Intelligence Unit, thus, it could unfreeze two bank accounts in Scotiabank Inverlat.

The document that justified the decision states that under “Article 115 of the Law on Credit Institutions, the bloking only applies to commercial agreements represented by the Mexican State and in the case of the food pantries, the negotiations were made between private companies. Paradoxically, the Venezuelan government now describes Alex Saab as a “government agent” for the purchase of food and medicine, and even claims “diplomatic immunity” for him. 

“The main problems that we have faced in Mexico regarding the case of the Clap pantries are, first, the illegal reparatory agreement established with the businessmen by the Attorney General’s Office of the previous administration, led by Alberto Elias Beltran, and, second, the case-law that former minister Eduardo Medina Mora promoted to avoid that there was a freezing of accounts by the FIU, in which it is established, that if there is no application of international nature, there is the possibility of unfreezing the accounts. And although there is an international application, the judges granted the injunction,” as censured by the head of the Financial Intelligence Unit.

The accounts of Group Grand Limited were initially blocked on October 5, 2018, after the suspicion of operations with funds from illegal sources. One of the company’s representatives in Mexico, Andres Leon Rodriguez, filed a petition for injunction against the measure. After a legal battle between the company and the authorities, the accounts were finally unblocked in November 2019. 

Other companies that were reported by Mexican authorities for their participation in the Clap plot, such as Ilas Mexico, B-Eminet, Digrava and Evaporadora y Secadora de Leches are near to achieve a measure similar to the one that benefited Group Grand Limited. Another proof that the investigation in Mexico fell into oblivion and that there were hardly any responsible for the accusations made in October 2018. With the apprehension of Alex Saab, the Mexican Financial Intelligence Unit seems ready to resume what it began two years ago and delve into the suspicious trail that the millionaire Clap business left in that country.

This is a work investigated and published simultaneously by Armando.Info and the Excelsior de Mexico newspaper.

One of such banks is the North International Bank (NIB), based in Antigua, but controlled by Venezuelan executives. In August 2016, the Venezuelan Superintendency of Banking Institutions (Sudeban) authorized the bank to appoint a representative in Caracas. “Promoting and informing Venezuelan residents of the products and services” that the bank “may offer” was one of the justifications of the Venezuelan banking regulator for granting the license contained in Official Gazette 40.970 of August 19, 2016.

At the time when the authorization was given, the United States had not applied economic sanctions against the chavista regime. However, Maduro’s administration was quick to use the services of North International Bank as a correspondent bank for state financial entities, such as Banco del Tesoro or Banco del Desarrollo Social (Bandes), and for the millionaire payments to intermediaries contracted to supply food for the Local Supply and Production Committees (Clap). Antigua is one of the jurisdictions with the highest banking secrecy, according to the index of the NGO Tax Justice Network.

For example, just eleven months after the approval by Sudeban, $425 million of a payment from Nicolas Maduro’s government to Group Grand Limited began passing through a bank account in North International Bank. Group Grand Limited is the company registered in Hong Kong behind which Colombian businessmen Alex Saab Moran and Alvaro Pulido Vargas hid in order to control imports for the Claps with Mexican products, from the very beginning of the state plan devised by Maduro. 

The details of that transaction are in contract CPVX-CJ-CONT-0086-2017 entered into by and between the state-owned Corporacion Venezolana de Comercio Exterior (Corpovex) (Venezuelan Foreign Trade Corporation), responsible for centralizing public imports, and the Hong Kong company. The document shows North International Bank and the Dutch Rabobank as channels of the transaction that would end in the coffers of Group Grand Limited, 50% of which was paid in advance.

The contract also shows that the Colombian duo,  widely favored by Nicolas Maduro with millionaire businesses since 2013, charged $37 for each Clap box, $3 more than for each combo from a previous contract. A year later, in October 2018, the Attorney General’s Office of Mexico reported irregularities, like overbilling or poor quality of the shipments of Group Grand Limited for the Venezuelan government.

At the time of the agreement, signed by Air Force Major General Giuseppe Yoffreda, representing Corpovex, neither Saab nor Pulido had been included on the Ofac’ list of those sanctioned by the U.S. Department of the Treasury, nor had they been accused of money laundering in a South Florida court, events that occurred in mid-2019. Nor had the Italian Guardia Di Finanza frozen their assets, as it did in last year’s November.

However, Armando.info had revealed by then that Colombian businessmen were camouflaging behind Group Grand Limited. A few years earlier, the Ecuadorian Attorney General’s Office accused them of several crimes allegedly committed with company Fondo Global de Construccion. In 2011, the businessmen duo had signed through this same company a multi-million dollar contract with the government of Hugo Chavez to build prefabricated homes in popular areas, which marked the beginning of the golden era of their business with the self-styled Bolivarian Revolution and the process took Alex Saab to the Miraflores palace in one of his few public appearances.

Group Grand Limited’s is not the only financial transaction linked to the Claps that has passed through jurisdictions known for their financial opacity. Saab and Pulido have personally used companies from the United Arab Emirates, while other intermediaries have received millionaire payments in banks in Hong Kong and Switzerland.

Correspondent Bank ⸺ Allied Government

It is possible that the Caracas government’s preference for North International Bank is because its partners are Venezuelan investors. Or perhaps, Saab and Pulido’s experience in the Antigua and Barbuda jurisdiction - which the Colombian tandem is very familiar with - has been more of a factor. Alex Saab even had a passport as the island’s “economic representative,” issued in 2014, when Prime Minister Gaston Browne had only been in office for a few months. Browne had to give public explanations for the issuance of that document, precisely when the investigations against Saab and Pulido were heating up. “All I can say to the people of Antigua and Barbuda is that if Mr. Saab is accused at any time of any wrongdoing, you can rest assured that we will revoke his appointment,” he said to a local radio station in October 2018.

Browne is a close ally of Maduro, but is not clear if this relationship preceded or went along with the conversion of Antigua and Barbuda into a Chavista financial hub. The relationship began within the framework of the Petrocaribe program, whereby Hugo Chavez managed to seduce many of the English-speaking Caribbean countries, which hold a significant number of votes at the OAS and other international forums. Nonetheless, Browne and Antigua and Barbuda stood out to the point that in 2019, they became full members of Alba (Bolivarian Alliance for the Peoples of Our America), the alliance of Bolivarian regimes also created by Chavez but currently in decline.

There is other evidence of the role of North International Bank in the financial tricks of Maduro’s administration. On December 24, 2017, the state-owned Banco del Tesoro wished a “Merry Christmas" to those it called “our correspondent banks.” The entity of Antigua and Barbuda was among the banks greeted, together with the Russian Gazprobank, Italbank International Inc and the Commonwealth Bank & Trust, domiciled in Dominica, another island in the Caribbean.

Deputy Carlos Paparoni, who has been investigating the business behind the imports for the Claps since 2017 and last year was appointed by the interim government of Juan Guaido as “presidential commissioner against terrorism and organized crime,” has also identified North International Bank as “an intermediary bank” in irregular or illegal financial operations of the Maduro regime, where Bandes (Economic and Social Development Bank of Venezuela) has participated. Until 2016, when Sudeban was approved and after eight years from its creation, the trail of North International Bank in Venezuela was rather discreet.

With a Venezuelan Accent

The first North International Bank representative in Caracas, endorsed by Sudeban, was Fidel Antonio Gomez Barrios, who is not known for his experience in financial institutions, saved for his presence in a company registered in Panama in 2008, called Optivalores Servicios Financieros S.A. Fidel Gomez will not be the only Venezuelan behind North International Bank. Actually, his partners and most of his employees are also Venezuelan.

The current partners of the bank are Jordan Alberto Silva Tugues and Carlos Eduardo Sandoval Arocha, both owners of NIB Asesores de Negocios in Caracas. With that company they filed in 2013 with the Autonomous Service of Intellectual Property (Sapi) the rights of the brand of North International Bank in Venezuela, which were granted to them the following year. Both the bank and the Caracas-based NIB Asesores de Negocios were founded in 2008 and have offices in Torre La Castellana, east of Caracas. Fidel Gomez, Jordan Silva and Carlos Sandoval also worked in Caracas for the firm Econoconsult Consultores Asociados.

Carlos Vicente Croes Hernandez was also a partner of North International Bank between 2015 and 2016. “I have never been a director of the bank, only a shareholder,” Croes affirmed. In his Linkedin profile, he stresses that he has “no administrative, managerial or directive responsibility” when referring to his time at the bank.

The face of North International Bank as chairman of the board is Jordan Silva. He was the one who appeared at the signing of a sponsorship agreement with the Spanish first-division soccer club Atletico de Madrid. “The agreement, effective for four years, aims to offer more and better payment options to our team’s fans in South America and the Caribbean, reinforcing their athletic identity and passion for soccer,” the Spanish team said in a statement, describing North International Bank as “a renowned bank" also based in the Dominican Republic, in addition to Antigua and Barbuda.

Yet, there is no trace of the potential operation of North International Bank in the Dominican Republic, not even on the bank’s website or in its promotional channels. Jordan Silva’s résumé also highlights his experience as president of the state-owned Banco Solidario C.A. from 2006 to 2008, as well as executive director of the Federal District Government from 1995 to 1998. When contacted for this report, Silva asked for the questions in writing, but as of the close of this edition, he had not responded.

Sources linked to the financial world explain that it was from 2014, when Sapi authorized the use of the North International Bank brand in the country, that it began to attract clients with the offer of prepaid debit cards in dollars, at a time when the rigid exchange control implemented by Chavism still limited the possibility of having dollars if traveling abroad. In fact, in addition to the use of the brand, Sapi approved the name “travel card” for the promotion of “prepaid and postpaid" debit and credit cards.

In the press release issued by North International Bank weeks after its alliance with Atletico de Madrid, it was affirmed that “it has issued over one million physical payment instruments in the last decade, from prepaid cards, credit cards, payroll cards to gift cards and other options.”

In 2014, North International Bank was also seen as a sponsor and co-publisher of brochures of Venezuelan visual artists. “For Nibank, it is an honor to contribute to Latin American society as an international sponsor of several social causes, within our commitment to the development of the human being in ethical, social, sporting and cultural aspects,” reads one of those brochures. It was an ambitious presentation for a reality that at the time was still rather diffuse.

Today, however, the bank seems to be expanding. In addition to the funds related to the Clap's intermediaries, the mediation or correspondent activities of Venezuelan state banks, as well as the sponsorship agreement with Atletico de Madrid, the institution is looking for staff for its office in Caracas. In February of this year, the bank published in its social media vacancies for administrators, corporate lawyers and IT means of payment and web development specialists, among other positions. This is another sign that North International Bank is booming since Sudeban authorized its operation in Venezuela in 2016, despite of the extended economic downturn experienced in the country.