The revolving door of the military is made of cement

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.

9 July 2017
Getting your Trinity Audio player ready...

If something has characterized the so-called Bolivarian Revolution, initiated by President Hugo Chávez and continued by his successor, Nicolás Maduro, is the active participation of military personnel in political responsibilities and techno-productive areas. It is no secret that officers of the four components of the armed forces represent one-third of the cabinet, and that in the last few years they have had a free rein for contracts of food purchase and sale, preferential dollar imports and even social security management. Wherever you look, in the current government, there is someone wearing an olive-green military uniform.

However, it is surprising to corroborate that in the last ten years, at least 785 officers have been State contractors. It is the figure that comes up by crossing the list of companies of the National Registry of Contractors - a database that has been downloaded and processed for this series of reports that starts today - and the list of military promotions within the public administration provided by Vendata, derived from 2,763 editions of the Official Gazette published during that period.

Although there is no rule prohibiting an active military officer from having a private company or being part of a board of directors, it is also true that the article 34 of the Civil Service Statute Law, as well as the numeral 4 of the provision 91 of the Organic Law of the General Comptroller of the Republic and the National Fiscal Control System, establish an administrative penalty for the military who contract with the State. So it could be argued that at least 785 officers have contravened the law.

"According to the article 145 of the 1999 Constitution in force, an active military officer by virtue of his status as a public official must refrain from entering into any contract with the Government (National, State and Municipal), either by himself or on behalf of a third party", explains the expert lawyer in public procurement, César Esteves.

There are 70 companies, for example, which have been responsible for selling to institutions of the State everything related to computers, stationery and office supplies

Trading business in general, transportation, food and computing services are some of the areas in which these companies have been acting, under management of military officers in the role of businessmen. There are 70 companies, for example, owned by commanders of the Armed Forces who have been in charge of selling to state institutions everything related to computing, electronic maintenance, stationery and office supplies.

But it is the construction sector where the largest number of companies owned by military officers is concentrated: 259 or, in other words, almost one in three of the 785 that did business with the State during the last decade.

It seems an almost obvious choice. Although nowadays remains paralyzed, up until 2012, at the heat of the extraordinary income from the oil boom and the government's housing plans, the construction sector was where everybody wanted to take part. Hugo Chávez dismissed traditional building companies and preferred to look for foreign suppliers, to put in charge of megaprojects, or new local entrepreneurs. It was the latter category where the military fit in.

General constructions works

An outstanding example of this permanent reinvention of some officers, who have no problem in metamorphosing from troop commanders to state contractors, and from there to government executives, is that of Frank Herbert Lynch Dávila.  

General of the National Guard - the military police corps in charge of borders protection, public order and the fight against organized crime in Venezuela -, Lynch is a thin man, with dark skin, calm expression and who, according to the photographs, always wears his magnifying glasses. On July 1st occurred one of his rare expositions to the media. In the National Pantheon, north-central Caracas, where the remains of the Liberator Simón Bolívar rest, President Nicolás Maduro officiated the ceremony of promotion of the officers with the first place in their promotion. According to the Venezuelan president, they were being condecorated in reward for "the loyalty and commitment" that the uniformed officers had demonstrated with the country "and the legacy of Hugo Chavez".

One of the promotions of that day was precisely that of Frank Herbert Lynch Dávila, who received the two golden suns in his ribbons which bestows him the rank of Major General. It was barely the second official recognition in less than three months. On April 17 he had been appointed President of the Socialist Corporation of Cement, S.A, affiliated to the Ministry of Popular Power for Habitat and Housing, as announced in the Official Gazette 41,132.

It was just part of the good streak that adorns the last years of the passage of Lynch Dávila in the public administration. He has received decorations and the headship of regional commandos in the states of Cojedes and Bolívar (central-west and southeast of Venezuela, respectively).

But in the field of private business, meanwhile, the high official of the National Guard was inadvertently part of the board of directors of a family construction business benefited by at least 31 contracts with the State.  

Frank Herbert Lynch Dávila is the vice president of a company called Projects, Inspections, Consulting and Constructions Lynch (Proincon Lynch, C.A.), which was incorporated in 1984 in the state of Zulia, according to the National Contractors Registry until this week. But after contacting him, the information suspiciously disappeared from the official servers. The record of the company, however, was kept for this article, where it is reported that the board is also integrated by Lynch's relatives such as Herbert Lynch Blackman, Carmen Beatriz Lynch Dávila and Herman Herbert Lynch Dávila.

Retired military personnel who provided testimony for this report point out that Lynch Dávila's proximity to the recently relieved commander of the Bolivarian National Guard, Antonio Benavides Torres - Caracas's new head of government - and his close friendship with the current Minister of Habitat and Housing, Manuel Quevedo - also an official of the National Guard - has taken him to the position he now occupies. "In his early years, Frank behaved like most officers but started to change with the incentives he was receiving. He is totally committed to the revolution. Even though he has a sister in the Miami MUD", says the former National Guard official and former director of Immigration and Foreigners Service, Marcos Ferreira.

Ferreira refers to Catherine B. Lynch Dávila, who in 2011 was a member of the MUD Committee for the Primary Elections Abroad (CEPEX) in Florida, Georgia and the Carolinas, in the United States.

Family business

The president of Proincon Lynch, C.A, engineer Herbert Lynch, is also the father of the Major General. He explains by telephone that the company in question is a family business with many years of experience and that his son has had no influence in the receiving of any contract. "Frank Lynch Dávila has a vice-presidency as a substitute. We decided to place him in that position after my wife's illness in 2007 and thus leave everything solved to my children when I die. He can't do anything in the company without my authorization and he has not received a cent from it. Let alone get contracts thanks to him. We have worked for all governments", says the engineer.

Frank Lynch Dávila has a vice president as substitute. We decided to place him in that position after my wife's illness in 2007

Proincon Lynch, C.A, between 2002 and 2015, was involved in at least thirteen construction works for the Venezuelan State. More than 40% of these works have already been completed. One of its clients was Odebrecht, the Brazilian civil engineering conglomerate involved in a worldwide scandal for paying bribes to public officials in twelve countries in order to obtain works contracts.

For Odebrecht, the Lynch family company was in charge of the engineering for the integrating road El Diluvio - El Palmar in 2008, which would serve an important irrigation system at the southwest of Lake Maracaibo, in the state of Zulia; irrigation system Zulia State; quality control of samples taken in the construction of asphalted roads and laboratory, in 2009; road pavement evaluation for the Socialist Agrarian Project of the Maracaibo Plain in 2011; and detailed engineering of agricultural roads for the irrigation equipment, that same year, for the aforementioned project.

The Socialist Agrarian Project of the Maracaibo Plain was promoted at the time as the solution to guarantee food sovereignty in that region of western Venezuela. According to the Odebrecht website, the project was conceived as an endogenous integral development plan, with the objective of promoting food production in the Venezuelan West and "it comprises farmland, housing, water bodies, road infrastructure and services, and field for more organized growth".

Shortly after Proincon Lynch's participation in the agricultural project, it began to languish. This did not affect the business of this company, which, by contrast, continued with the wind on its sails. While Lynch Dávila was coordinator of the Bicentennial Security Device (Dibise) in the municipality of Caroní, State of Bolivar, in the south of the country, and then commander of the 88th detachment in Puerto Ordaz, the main commercial and industrial city of the same state, his company received construction contracts for apartments in the area.  In 2011, the Mission Habitat Foundation assigned it the task of making 422 homes in different communities of the Dalla Costa parish and then received two more contracts to carry out additional works after building these houses.

Proincon Lynch also had clients like the National Cinematheque Foundation in the states of Anzoátegui and Monagas, in the east of Venezuela; the Foundation for the Sports Infrastructure of the State of Zulia for the rehabilitation of football fields; and the Investment Fund Misión Negro Primero S.A. for the construction of dormitories, stables and obstacle courses for the troops of the National Guard.

On the occasion of this report, an interview request was sent to Major General Lynch Dávila, to his office of the presidency of the Socialist Corporation of Cement, which was not attended.

¡Hola! Gracias por leer nuestro artículo.

A diferencia de muchos medios de comunicación digital, Armandoinfo no ha adoptado el modelo de subscripción para acceder a nuestro contenido. Nuestra misión es hacer periodismo de investigación sobre la situación en Venezuela y sacar a la luz lo que los poderosos no quieren que sepas. Por eso nos hemos ganado importantes premios como el Pulitzer por nuestros trabajos con los Papeles de Panamá y el premio Maria Moors Cabot otorgado por la Universidad de Columbia. 

Para poder continuar con esa misión, te pedimos que consideres hacer un aporte. El dinero servirá para financiar el trabajo investigativo de nuestros periodistas y mantener el sitio para que la verdad salga al aire.


Artículos Relacionados

Newly Sanctioned by the United States of America, but an Old Friend of Saab and Pulido

Adrián Perdomo Mata has just entered the list of sanctioned entities of the US Department of the Treasury, as president of Minerven, the state company in charge of exploring, exporting and processing precious metals, particularly gold from the Guayana mines. His arrival in office coincided with the boom in exports of Venezuelan gold to new destinations, like Turkey, to finance food imports. Behind these secretive operations is the shadow of Alex Saab and Álvaro Pulido, the main beneficiaries of the sales of food for the Local Supply and Production Committee (Clap). Perdomo worked with them before Nicolás Maduro placed him in charge of the Venezuelan gold.

Electoral Observer Sells Food to the Government of Maduro

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.

Three Families in Mexico Fatten their Fortunes with Venezuela’s Claps

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.

The Mexican milk of the Claps - Many Brands, Poor Quality and Virtually One Supplier

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.

Import Businesses for Claps Flourish Even in the United Arab Emirates

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.  

Venezuela - You Have to Pay to Reach the Horizon

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.

1 2 3 9

Otras historias

The 2019 blackout derived in a network in Mexico to evade sanctions against Maduro

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, developed from a leak of thousands of documents.

Lopez Obrador's government was aware of underground business with Venezuela

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.

Alex Saab left charcoal-marked fingerprints on Mexican network

The business structure that Alex Saab had registered in Turkey—revealed in 2018 in an article by—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.

For everything else, there were Joaquín Leal and Alex Saab

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.

Two stepbrothers — One penalty

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?

They offered to resuscitate Venezuelan aluminum production but rescued a Mexican consortium

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.

1 2 3 24
Sitio espejo
usermagnifierchevron-down linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram