In 2007, Retired General Víctor Cruz Weffer, head of Plan Bolívar 2000 and Fondur, opened a company in Seychelles after he was charged for illicit enrichment and data concealment. He could never justify the Bs. 1,071 million increase of his equity, equal to 86% of the funds he managed from 2000 to 2003.
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Residents of Juan Manuel Cajigal home residency, located in the San Andres area of the populated El Valle parish of Caracas, complain about the problems affecting their homes since they were built in the dawn of the self-styled Bolivarian revolution: leaks, lack of water, overcrowding and unfinished works. The apartments, built by the National Housing Institute, Inavi, one block from El Valle Metro station, were part of the first major project of Plan Bolivar 2000, a civic-military alliance launched by the then President Hugo Chávez during the first year of his government, with the promise of directly serving poor families through various services: popular markets, street repair, medical care and construction of popular housing.
On June 6, 1999, in the Aló Presidente (Hello President) program number 2, which was back then broadcasted on Radio Nacional de Venezuela station, a willful Chávez announced the construction of the first 128 popular homes in the San Andrés area through the merger of State institutions "in order to prevent anarchy and corruption." Also, the recently elected president stressed that for the construction of 1,424 apartments in El Valle area of Caracas and another 1,800 in Valles del Tuy in Miranda, 20 billion bolivars (33 million US dollars at the time) would be invested, and that only to start the first year, 7 billion bolivars (11.5 million dollars) had been approved. "That is part of the Plan Bolívar 2000, in which I take a chance on life," said the former president when the so-called Fifth Republic was in full expansion.
In that 1999 radio program, Chávez also presented General Víctor Antonio Cruz Weffer as the new head of the Plan Bolívar 2000, who would manage a budget of Bs. 73,000 million ($ 120,462,046 at the time) from 1999 to 2000 to execute a project that would act as the first test balloon of the social missions of the Bolivarian government.
But the officer, who held three other positions in the Chavez bureaucracy, did not attend the opening ceremony of these works. In December 2001, he left the government through the backdoor amid allegations of corruption of which he would be the main protagonist.
Cruz Weffer had barely been out of the government for a month when he began to be investigated by the Public Prosecutor's Office (PPO) on January 14, 2002, following a complaint by Seniat and a series of reports published in some national media that referred to irregularities committed in the Project Plan Bolívar 2000 and Fondur (National Fund for Urban Development). Five years later, on April 18, 2007, the former army commander was charged with the crimes of illicit enrichment and concealment of data in his affidavit of assets and means.
The Public Prosecutor's Office based its version on the final audit report submitted by the Comptroller General of the Republic (CGR) on January 31 of that year, which certified that the former head of Plan Bolívar 2000 and former president of Fondur had 1.2 billion bolivars between January 1, 2000 and June 30, 2003. The Comptroller concluded that Cruz Weffer could not justify how the increase of his assets to 1,071 million bolivars (approximately one million dollars at that time) corresponded to his income as an official. The amount was equal to 86% of the public funds he managed as head of the Plan Bolivar 2000 and president of Fondur.
On May 7, 2007, three weeks after being charged by the Public Prosecutor’s Office for crimes provided for in the Venezuelan Law against Corruption, Cruz Weffer diverted his business career to another continent, 13 thousand kilometers away from the popular homes, the red ribbons of which he did not cut. In Seychelles, an archipelago of white sands and emerald waters of the Indian Ocean, company Univers Investment Ltd was registered in his name with a capital of 50 thousand dollars.
The registration of Cruz Weffer’s company in this tax haven, a renowned international sanctuary of luxury tourism and shell companies for money laundering and tax evasion, would not be his first mercantile transaction abroad. In 2007, the Venezuelan Prosecutor's Office confirmed the tracking of transfers amounting to 330 thousand dollars made by the accused officer to bank accounts abroad, according to the Comptroller General's Office report.
At first sight, the name of Cruz Weffer does not appear on the initial company register or on the certificate of going concern of September 29, 2008, issued by Seychelles authorities. In fact, the registration of Univers Investment in the archipelago was not made directly by the Venezuelan military man but by Barreto & Partners Sàrl, a property management firm domiciled in Switzerland, which is in turn a client of the prominent Panama-based law firm Mossack Fonseca (MF).
The name of Cruz Weffer is covered under the concept of "bearer", one of the company registration methods offered by the Panamanian law firm to guarantee a high level of confidentiality. In this case, an offshore company was created (which does not carry out any economic or commercial activity in the country where it is registered and does not pay taxes) whose intermediary Barreto & Patners Sàrl (an M&F client) acted as representative.
The registration of Cruz Weffer's company complied with the formalities required by the Seychelle International Business Authority (SIBA), which notified Mossack Fonseca & Company’s branch in the archipelago the incorporation of Univers Investment on May 7, 2007, under number 036837.
Barreto & Partners Sàrl has opened around 47 shell companies in tax havens (6 of Venezuelan shareholders in Seychelles) as an intermediary of MF. Its headquarters, domiciled in the Route de Lussy in St Prex, Switzerland, contradicts the magnitude of the group of companies it represents, the owners of which are around the world.
The relationship between Cruz Weffer and Univers Investment is registered in MF databases. However, in the e-mail exchange that took place in 2009 between the head office and the branch in Seychelles, it is made known that SIBA asked MF to update the names of the shareholders and addresses of the companies registered in the archipelago due to the requirements of the amended Law in Seychelles. The update had to be submitted by January 1, 2010.
The direction of the sole shareholder of Univers Investment, as indicated in the registration form, is not at the shores of the Indian Ocean but rather the Caribbean Sea, specifically in Caracas, at residencias Cascadas La Castellana, located in La Castellana area. It is an exclusive residential complex that has private security and electric gates.
The author of this release contacted Cruz Weffer at the company's address in Caracas. They requested a written interview on March 15, 2016, as well as on March 25, 2016 with a questionnaire about the companies registered abroad. Via e-mail (03-30-2016), the retired officer denied having registered Univers Investment: "Searching on the Internet, I could verify that Seychelles is a group of islands belonging to the African Continent, where I have never been, so I could not register a company in that place" (sic). He also suggested that his departures from and entries into the country could be easily checked through a request to the Ministry of Foreign Affairs. He added that "years ago" he acquired a company registered in Panama for an amount of $ 50 to open an account in a subsidiary bank of Crediss Suiss (sic) in Geneva, to request a loan from the Italian financial institution Credito and Svillupo in order to develop housing projects in Venezuela. He clarified that both the company and the account are currently closed.
Contrary to what Cruz Weffer says, today you do not need to travel to open a business in a tax haven. Hard-to-trace property certificates known as "bearer shares" can be issued through firms that act as intermediaries, as it is the case with Univers Investment.
Cruz Weffer's company in Seychelles existed for 4 years old and, based on its company register form, it did not record major movements over those years. It was closed on April 11, 2011, the year when a court acquitted the corruption trial against the former head of Plan Bolívar 2000. This decision was shortly after appealed by the Prosecutor's Office.
The challenged management of Cruz Weffer in the Plan Bolivar 2000 and Fondur became the first corruption scandal of the Chávez government not only because of the public amount involved (around 120 million dollars) but also because it involved one of the most loyal figures to the late president.
Initially introduced by Chávez as a "novel revolutionary plan", Plan Bolívar 2000 began to be targeted by points raised about irregularities practically from the beginning. For example, El Nacional Newspaper published that Cruz Weffer had bought an apartment in the exclusive Colinas de Tamanaco area for 1.8 million dollars. The general merely said that he was the target of a defamation campaign, but he never denied the purchase.
Two years after creating Plan Bolívar 2000, Chávez was taking power from the Plan executor, and on December 24, 2011, he confirmed on his radio program Aló Presidente that the removal of Cruz Weffer from the Command of the Army was a "decision to tighten the pliers, like any other."
Graduated two years before Chávez, Cruz Weffer was ranked second in his 1973 class at the Military Academy. Although it was not part of the foundational February 4 (military coup led by Chávez in 1992 against President Carlos Andrés Pérez), he was part of his circle of trust.
"Cruz Weffer had a privileged treatment in the first years of the Chávez government. Not everyone was given a strategic economic sector such as the construction sector in Venezuela. The late president cared for him, but the officer started committing too many excesses and Chávez did not forgive him,” says Rocío San Miguel, director of Control Ciudadado (Social Watch) organization.
The analyst stresses that Chávez never punished the uniformed officers who had incurred in administrative irregularities, except in the case of Raúl Baduel and the military man of Central Azucarero (sugar company) Ezequiel Zamora (Caeez), General Delfín Gómez Parra (convicted in 2011 to 7 years and 7 months of prison when he had been already imprisoned for 5 years and two months). "When Chávez got angry with them he used to drive them away, appoint them in embassies. He acted as a pater familias in a relationship of power and control over his subordinates."
San Miguel does not rule out a possible "dirty war" within the armed forces that drove Cruz Weffer's fall from grace. "Not all the military men liked him, because of all the power he had."
A fact that highlights a report on Venezuela by the US firm Stratford (reproduced by Veneconomía in November 2011) could give clues about the cracks within the armed forces before the coup of April 11, 2002. The then Minister of Defense José Vicente Rangel and the military high command issued a public statement expressing their full support for Chávez. The document, aimed to counteract discontent within the Army, was not signed by any of the top commanders, including Lucas Rincon and Cruz Weffer, who were considered Chávez's most important military tokens.
The growing corruption within the government was one of the main discrepancies within the Army at the beginning of the first decade of the century. Just by reviewing Cruz Weffer's statements in 2000 one can understand the criterion that the former general had about the management of public funds. When he was still the owner of Fondur, he said that he disagreed with the bidding method to choose the companies that would execute the works. "They are won by 4 or 5 construction companies that are the mafias of construction. The direct award instead gives an opportunity to over 400 small and medium-sized companies," he told El Nacional on 3-8-2001.
Although Cruz Weffer tried to keep a low profile after being separated from the charges, he did not stop working indirectly for the Chavez government. Based on the IVSS Social Security registry, until 2014, he was president of company Grandes desarrollos integrales y organizacionales de soluciones sociales C.A. (Grandiosos), a State contractor with the business purpose of "developing and executing civil, electrical and industrial construction works and projects." The retired general already had experience in this sector.
According to the National Registry of Contractors (RNC), the vice president of Grandiosos was José Antonio Páez Jurado, a member of the Military Academy of Cruz Weffer but from the class of 1972 Brigadier General Pedro Briceño Méndez.
Grandiosos is outdated in the RNC, i.e. is disqualified to enter contracts into with the State. It also has no headquarters; at least it does not work at the address indicated in the Registry, at Torre Credicard in El Bosque. The new occupants of the office (the news portal Entodonoticias.com, openly pro-government, a television production company, and a modeling academy) have no information on where to locate the construction company chaired by Cruz Weffer, who moved from the place about two years ago. The Cantv landline phones on the RNC card do not work.
In the years when he was being investigated but not yet accused of corruption, Cruz Weffer was engaged in business activities. He appears as CEO of company Pac Rim Group, registered in Caracas in 2005. Despite not being in the National Registry of Contractors (RNC), this company signed on May 12 of the year after its creation a strategic Alliance agreement with the Government of Carabobo, under the administration of Luis Felipe Acosta Carlés - Brigadier General of the Bolivarian National Guard (GNB) - for the "construction, fitting out, administrative management, operation, and maintenance of the Bartolomé Salom International Airport of Puerto Cabello.
According to the document, the alliance with the Government of Carabobo also entailed the granting of the 50-year concession to Pac Rim Group from May 12, 2016 to May 12, 2056. On that occasion, the company estimated an approximate investment of 850 million dollars in infrastructure, equipment and acquisition of adjacent land to build the operational airport runway, among other expenses. Currently, the Puerto Cabello airport is operational, but has no commercial flights. It belongs to Bolivariana de Aeropuertos (Baer), attached to the Ministry for Water and Air Transport.
Cruz Weffer, together with his ex-wife, Lenis Josefina León de Cruz, also registered properties in the United States of America before being accused. According to the official records of Broward County Florida, on November 25, 1996, they were beneficiaries of a concession of a property at 16691 Royal Poinciana Dr, Fort Lauderdale, Florida, valued at $ 287,300. On May 23, 2005, that same property was transferred by the couple to Corey Schmith.
Another property where Cruz Weffer has his name domiciled in the US is 524 N Paxton Alexandria, Virginia 2230, where the company Cruz and Tran (registered on January 27, 2011) operates, and according to the Realtor.com registry, it is valued at $ 493,025.
Cruz Weffer admits by e-mail that from 2003, when he officially went into retirement, he began to work as a self-employed. He created two construction companies (one active and one inactive) in Venezuela, and a third one abroad, of "low capital and personnel", he clarifies. He is also an advisor to several companies in the sector. He details that he has two personal accounts and a legal account in the name of Promotora Colinas de Yara that develops a residential complex in Maturín, Monagas, called Puertas del Sur Country.
He adds to the communication that he has a personal account abroad recently opened at Banco Banistmo in Panama, "because I am trying to develop a project of social interest homes in that country," and a legal account in the name of VK Land Group, "unilaterally" managed by his partner, Krsmer Velásquez Fariñas.
Since he began to be investigated by the Prosecutor's Office in 2002, the legal process against Cruz Weffer has been fully intermittent over 14 years. Annulments, habeas corpus and appeals make it a case of procedural delay "for the benefit of the accused," says Juan Carlos Apitz, university professor and former magistrate of the TSJ (Supreme Court of Justice). "The accidents were used for the accused not to be finally convicted to serve his sentence."
The last judicial decision known dates from July 16, 2013, when the Constitutional Division of the Supreme Court of Justice ordered the prosecution against Cruz Weffer, directing the Court of Appeals of the Criminal Judicial Circuit of Caracas to resolve the appeal filed by the Public Prosecutor’s Office. But "where is the new sentence? What happened to the file of the Court of Appeals?" asks Apitz.
The trial against the former president of Plan Bolivar 2000 seems to be "shelved", a formula that allows crimes and their respective punishments to be forgotten over time, recalls Apitz. If we take into account that the crimes charged to Cruz Weffer go back to 2002, and article 108 of the Criminal Code provides that a criminal action prescribes at 15 years, in 2017, the criminal process against the first case of corruption of the Chávez government could be rendered ineffective.
On March 30, 2016, Cruz Weffer affirmed by e-mail that the Office of the Comptroller General of the Republic (CGR) recognized by the repeal of the US Department of State the existence of a credit from Sun Trust Bank for $ 330,000, duly declared and received by wire transfer in Banco del Caribe, equal to Bs. 480,000, when there was no exchange control in the country. "What was acquired with that money - land, equipment, material for organic crops, tractors, power plants – were added to the equity increase instead of being subtracted by the most perverse and evident bad intention. The Office of the Comptroller said that they should not be considered in the affidavit of means and assets because it is a company (Criadero Villa de Lobos) owned by me. However, they were considered as a personal equity increase," he assured 9 years after the CGR report.
Also, regarding the "alleged crime of data
concealment," Cruz Weffer indicates that the land of Nueva Tucacas, state of
Falcón, which was indeed not declared, had a value of
Bs. 12,000, which the
Office of the Comptroller describes as "a hut type, with streets with no
sidewalks or sewers, and not asphalted," which also measured 240 square meters
(2,583.34 sq ft) and he assures that he never went to that place, which is why
he did not include it in the statement. "What is the bad intention of hiding an
asset with these characteristics?" asks the retired
general.
The rebel prosecutor, Luisa Ortega Díaz, opened a real Pandora's box. Her accusation against Group Grand Limited not only strips the food import business for the popular Local Supply and Production Committee (CLAP). It also confirms that the businessman from Barranquilla, Alex Nain Saab Morán, hitherto linked to former Colombian senator, Piedad Córdoba, is also a hinge of President Nicolás Maduro. From the port of Veracruz, at least 7 million boxes of food have been shipped to Venezuela by a ghost company with no permanent office in Caracas or Mexico, and thanks to a millionaire contract with the Venezuelan government.
José Gregorio Vicari Méndez, an assimilated physician of the Bolivarian Army, was the successful owner of Proveeduría Médica VDS, a medical supplies company that signed hundreds of contracts with the health office during the oil boom. This finding is part of a database developed by Armando.info with the public information contained in the National Register of Contractors. Although the Organic Law of the Office of the Comptroller states that an active official could have administrative responsibility if entering into contracts with the State, Vicari Méndez, who is no longer a member of the company, presents an argument in his defend that goes beyond the tragedy of Venezuela's shortages. "If I have a patient with a requirement, if there is no material, but I know where there is, I look for it. What should I do? Should I not operate?
New leaks of the "award-winning delation" that the construction company's proconsul in Caracas, Euzenando Azevedo, made to Brazilian justice last December reveal that in the elections to choose the successor to the late commander Hugo Chávez, Odebrecht made a Solomonic decision: to reach an understanding with the candidates of the Government and the Opposition and make contributions to the campaigns of both. It would not be on an equal footing: one was given $35 million, the other $15 million. But with the same consideration for both: that the public works contracts in charge of the multinational engineering company had to be respected.
In the Bolivarian Revolution of Venezuela, which has a strong military component, military officers can act, simultaneously or progressively, even in contravention of the law, as troops leaders, government executives and even state contractors. One in three of the 785 military officers active in their time who, as private, contracted with the public administration during the last ten years, did it from companies that have the social purpose of construction. One case stands out: Major General Frank Herbert Lynch Dávila. The family company of which he is part has received contracts for construction works for years while the officer escalated positions until being in charge of the cement supply throughout the country.
Pequiven, a subsidiary of Petróleos de Venezuela, sought shelter in tax havens to legalize its association with Iranian company National Petrochemical Company, from which Veniran emerged. Although the Panamanian law firm was suspicious of the alliance between the then presidents Hugo Chávez and Mahmud Ahmadinejad, it finally solved the inconvenience to please both clients.
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.
When Vice President Delcy Rodríguez turned to a group of Mexican friends and partners to lessen the new electricity emergency in Venezuela, she laid the foundation stone of a shortcut through which Chavismo and its commercial allies have dodged the sanctions imposed by Washington on PDVSA’s exports of crude oil. Since then, with Alex Saab, Joaquín Leal and Alessandro Bazzoni as key figures, the circuit has spread to some thirty countries to trade other Venezuelan commodities. This is part of the revelations of this joint investigative series between the newspaper El País and Armando.info, developed from a leak of thousands of documents.
Leaked documents on Libre Abordo and the rest of the shady network that Joaquín Leal managed from Mexico, with tentacles reaching 30 countries, ―aimed to trade PDVSA crude oil and other raw materials that the Caracas regime needed to place in international markets in spite of the sanctions― show that the businessman claimed to have the approval of the Mexican government and supplies from Segalmex, an official entity. Beyond this smoking gun, there is evidence that Leal had privileged access to the vice foreign minister for Latin America and the Caribbean, Maximiliano Reyes.
The business structure that Alex Saab had registered in Turkey—revealed in 2018 in an article by Armando.info—was merely a false start for his plans to export Venezuelan coal. Almost simultaneously, the Colombian merchant made contact with his Mexican counterpart, Joaquín Leal, to plot a network that would not only market crude oil from Venezuelan state oil company PDVSA, as part of a maneuver to bypass the sanctions imposed by Washington, but would also take charge of a scheme to export coal from the mines of Zulia, in western Venezuela. The dirty play allowed that thousands of tons, valued in millions of dollars, ended up in ports in Mexico and Central America.
As part of their business network based in Mexico, with one foot in Dubai, the two traders devised a way to replace the operation of the large international credit card franchises if they were to abandon the Venezuelan market because of Washington’s sanctions. The developed electronic payment system, “Paquete Alcance,” aimed to get hundreds of millions of dollars in remittances sent by expatriates and use them to finance purchases at CLAP stores.
Scions of different lineages of tycoons in Venezuela, Francisco D’Agostino and Eduardo Cisneros are non-blood relatives. They were also partners for a short time in Elemento Oil & Gas Ltd, a Malta-based company, over which the young Cisneros eventually took full ownership. Elemento was a protagonist in the secret network of Venezuelan crude oil marketing that Joaquín Leal activated from Mexico. However, when it came to imposing sanctions, Washington penalized D’Agostino only… Why?
Through a company registered in Mexico – Consorcio Panamericano de Exportación – with no known trajectory or experience, Joaquín Leal made a daring proposal to the Venezuelan Guyana Corporation to “reactivate” the aluminum industry, paralyzed after March 2019 blackout. The business proposed to pay the power supply of state-owned companies in exchange for payment-in-kind with the metal.
