Perhaps it wasn’t all that surprising that PDVSA, Venezuela’s state oil company, wanted to wash its hands of the affair after hundreds of millions of dollars went “missing” from one of its pension funds because of fraud and even Ponzi activity.
But a dogged receiver, John Carney, has filed a flurry of lawsuits (documented here) in a Connecticut-based court over the last couple of days in a bid to recover some of that money – and guess what, one of the people being sued is a former PDVSA executive.
Juan Montes, who was a senior pension fund investment manager at PDVSA, allegedly received almost $36m in bribes in exchange for keeping quiet about approving financial transactions with firms run by Francisco Illarramendi, who now faces 70 years in prison after last year pleading guilty of running a massive Ponzi scheme (in essence, he had set up investment funds on behalf of PDVSA that went badly wrong, and then tried to hide the losses through a series of complex and fraudulent transactions).
Although he is not the only man Carney is going after, what is especially interesting about the case is that Montes is believed to have authorised the sale of government dollars at the official exchange rate to Illarramendi’s companies, which then sold those dollars back onto Venezuela’s currency black market, where at the time dollars could fetch as much as three times the price.
To make things still more uncomfortable for PDVSA, Carney says that “other officials” at the oil company were involved in approving the transactions with Illarramendi’s companies – indeed, it is hard to believe that this is not the case, given the amount of money involved.
And just to give the whole tale an even deeper sense of intrigue, Illarramendi and Montes apparently communicated with each other using pseudonyms, with Montes adopting the name “Black”.
But this is only one of six cases filed in the last few days, with over a dozen people implicated. The biggest accuses Venezuelan financier Moris Beracha of providing “the money or access to money that kept Illarramendi and his scheme afloat”, as well as receiving “approximately” $171,675,738 in fraudulent transfers, which comprised “investor proceeds and other monies that must be recovered for distribution to Illarramendi’s victims and creditors”.
The documents concerning the case also mention “millions of dollars in bribes to at least one Venezuelan government official”. There must be quite a few people shifting uneasily in their seats right now.Source