The last two major global investigations conducted by the International Consortium of Investigative Journalists revealed the offshore business of Eligio Cedeño, a former Venezuelan banker considered a fugitive from justice by some and politically persecuted by others. Company Cedel International Investment, owner of Bolívar Banco and Banpro, also requested the services of Mossack Fonseca to operate in the British Virgin Islands.
Company Cedel International Investment LTD - which was the owner of the Venezuelan banks Canarias, Banpro and Bolivar Banco - operates in the tax jurisdiction of the British Virgin Islands, as revealed by the information of the last worldwide filtration known as the Panama Papers and published by the International Consortium of Investigative Journalists (ICIJ).
The name of Cedel comes from the abbreviations of the last and first name of the Venezuelan banker Eligio Cedeño. The Chavismo arrested him and accused of a scam that led to a legal process that ended with him fleeing to the United States of America in 2009 and, at the same time, gave rise to the already infamous case of Judge María Lourdes Afiuni.
Eligio Cedeño and his brother Santos Luis Cedeño are the main shareholders of the company in the British Virgin Islands, registered in 2003, through company Amanco Management (BVI) Ltd, who used the law firm Mossack Fonseca as an intermediary to create offshore companies. Cedel was also the name of the brokerage firm that operated in the Venezuelan capital, owned by Cedeño, which was intervened by the National Securities Superintendency (SNV) in January 2011.
In an interview with Armando.info, Cedeño says that appearing in the Panama Papers has been distorted and that if he had had bad intentions in creating the company he would not have signed as a beneficiary. "An entrepreneur, not a public official, does usually have companies to hold his or her assets. And he or she usually has such companies outside the jurisdiction where he is represented... It will be possible to identify the one with good intentions and the one with bad intentions when the shareholder ends up being an employee of the firm and not the real owner. And that is not my case," says the former banker.
Eligio Cedeño has been one of the most controversial entrepreneurs in contemporary Venezuelan history. Native of Caracas, of humble origin, he began his career at 16 years of age as an intern and at 30 he already owned his own brokerage firm. He was also the president of a financial institution, but his luck changed in February 2007, when he was charged for the Microstar case. The Venezuelan justice accused him of simulating the importation of computers and opened the abovementioned legal process.
In the early 90’s, Cedeño founded Cedel Casa de Bolsa, previously called Citi-Invest, which was questioned a decade later for having been benefited in a sale transaction of National Public Debt Bonds. In 2002, the Ministry of Finance of Venezuela authorized Cedel to sell bonds for about 190 billion bolivars, when its capital was only about 7 billion bolivars. The operation was considered flaw-ridden since the brokerage firm bought the bonds at 78% and then resold them in the secondary market to Bandes, a state bank, at a value of 91%.
In addition to having the brokerage firm, Cedeño owned shares in Banco Canarias, Banco Caracas, Banpro and Bolívar Banco, which were later on liquidated by the Venezuelan Government. However, at the time of the intervention, they were no longer owned by the Cedel group, explains the former banker: "The banks were mine, but four months after being arrested I sold them to supporters of the regime. Two and a half years later, those banks went bankrupt. But they did not go bankrupt in my hands, but in theirs. The owners were already another company, not Cedel International Investment. "
The company in the British Virgin Islands owned Banco Canarias before Cedeño became the owner of Banpro and Bolívar Banco. Once these entities were acquired, in 2004, Cedel ceased to have a relationship with Banco Canarias.
As to the legality of this type of company, the professor and former national superintendent, Alejandro Caribas, explains that the Venezuelan Banks Law requires the Superintendency’s authorization for banking entities incorporated in the country to have branches abroad or investments in banks abroad. "It is generally required that where branches are opened or investments are made, there are institutions engaged in banking control and supervision".
In this case, the Superintendency of Banks (Sudeban), in communication of February 15, 2005 authorized Bolivar Banco C.A. "the transfer of 100% of the associated capital of the Financial Institution to company Cedel International Investment, LTD, existing under the laws of the British Virgin Islands;" hence, he was aware of the existence of the company.
Venezuelan laws prohibit transactions or operations with offshore banks.
312-10 published in 2010 by Sudeban provides that "it is prohibited to carry out and maintain operations with banks and other entities, with banking and/or investment licenses granted in countries, states or jurisdictions with tax systems with low tax burden, without supervision or monetary, banking or financial regulation and with strong protection to bank secrecy."
The name of Cedel International Investment LTD also appeared on the well-known Falciani list. In 2015, the ICIJ published a series of reports on the more than 106,000 clients with accounts in the Swiss bank HSBC, from different countries around the world. The data was filtered by the former employee of that entity, Hervé Falciani.
The account of Cedel International Investment LTD in HSBC, owned by Eligio Cedeño and his brother, had a balance of around 38 million dollars in 2006 and 2007, based on the leak.
Cedeño has publicly accepted the existence of that account. But he claims that it was closed in 2011. "This same company that appears in Mossack Fonseca had an account with HSBC, and when the accounts of the shareholders leaked, Cedel appeared there. What you have discovered is a company that owned a bank and an account with funds. Typical of my usual performance as an entrepreneur," he said.
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Gassan Salama, a Palestinian-cause activist, born in Colombia and naturalized Panamanian, frequently posts messages supporting the Cuban and Bolivarian revolutions on his social media accounts. But that leaning is not the main sign to doubt his impartiality as an observer of the elections in Venezuela, a role he played in the contested elections whereby Nicolás Maduro ratified himself as president. In fact, Salama, an entrepreneur and politician who has carried out controversial searches for submarine wrecks in Caribbean waters, found his true treasure in the main social aid and control program of Chavismo, the Clap, for which he receives millions of euros.
While the key role of Colombian entrepreneurs Alex Saab Morán and Álvaro Pulido Vargas in the import scheme of Nicolás Maduro’s Government program has come to light, almost nothing has been said about the participation of the traders who act as suppliers from Mexico. These are economic groups that, even before doing business with Venezuela, were not alien to public controversy.
Even though there are new brands, a new physical-chemical analysis requested by Armando.Info to UCV researchers shows that the milk powder currently distributed through the Venezuelan Government's food aid program, still has poor nutritional performance that jeopardizes the health of those who consume it. In the meantime, a mysterious supplier manages to monopolize the increasing imports and sales from Mexico to Venezuela.
Turkey and the coastal emirates of the Arabian Peninsula are now the homes of companies that supply the main social -and clientelist- program of the Government of Venezuela. Although the move from Mexico and Hong Kong, seems geographically epic, the companies has not changed hands. They are still owned by Colombian entrepreneurs Alex Nain Saab Morán and Álvaro Pulido Vargas, who control since 2016 a good part of the Import of food financed with public funds. Around the world for a business.
Since the borders to Colombia and Brazil are packed and there is minimal access to foreign currency to reach other desirable destinations, crossing to Trinidad and Tobago is one of the most accessible routes for those in distress seeking to flee Venezuela. Relocating them is the business of the 'coyotes' who are based in the states of Sucre or Delta Amacuro, while cheating them is that of the boatmen, fishermen, smugglers and security forces that haunt them.
They lose their freedom as soon as they set foot on any Trinidadian beach, and their “original sin” is an alleged debt that these women can only pay by becoming sexual merchandise. They are tamed through a prior process of torture, rotation and terror, until they lose the urge to escape. The growth of these human trafficking networks is so evident that regional and parliamentary reports admit that the complicity of the island’s justice system in this machinery of deceit and violence multiplies the number of victims.
In front of the curtain of collapse of the major financial group in Portugal, José Trinidad Márquez, a native of Caracas, offered the stellar performance to his lifetime career of fraud. After swindling the high management of the bank, he’s taken refuge presumably in some part of Spain, where the press baptized him as “the golden middleman” or “the man with thousand faces”. With his well trained routine of a petroleum expert, who offers himself to try and arrange business connections with PDVSA, perfected over the course of more than two decades, he’s earned himself millions of dollars, as well as criminal accusations in various countries.
Nicolas Maduro’s main contractor was arrested last Friday, right after landing at the international airport of Cape Verde, an archipelago in the Atlantic, on the gates of Africa. It may be his penultimate trip, if he is finally deported or extradited to the United States, as U.S. authorities expect. It would be the worst of all endings after many years travelling and earning miles but, above all, millions of dollars thanks to opaque corporate structures, whereby he managed preferential currencies, public works, food supplies for the CLAPs, contracts with PDVSA, and even the trade of Venezuelan gold and coal since 2013.
A small bank in Antigua and Barbuda, but controlled by Venezuelans, is at the center of some of the financial operations of Nicolas Maduro’s regime. Created in 2008 and with a diffuse trace for years, North International Bank began to take off in 2016 when it was authorized to operate in Caracas. Since then, it has been channeling millions of dollars to and from the coffers of the revolutionary ‘nomenklatura.’
For some months now, parliament members of different opposition political parties have been offering to make informal proceedings on request before agencies like the Colombian Attorney General's Office and the United States Department of the Treasury. They issue letters of good conduct to those responsible for negotiations on the imports for CLAP combos, so that such agencies absolve or stop investigating entrepreneurs like Carlos Lizcano, a subordinate of the already sanctioned Alex Saab and Alvaro Pulido. The fact that the most active defense of the main social program and focus of corruption of the government of Nicolas Maduro comes from the heart of the National Assembly 'in contempt' is just one of the ironies of this story.
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