On March 17th, 2023, Chavismo allegedly began a new “crusade against corruption” to fight illegal acts that occurred in the main industry of the country: PDVSA.
Walter Obregón // Correspondent lapatilla.com
Hours later, Nicolás Maduro’s regime of reported the first arrests of those involved in the “corruption plot” that included: judges, deputies, frontmen and a prostitution network, all of which charged high sums of money in dollars and led the state-owned petroleum corporation to an abyss.
The Anti-Corruption Police, an investigative body that receives orders exclusively from Maduro’s office, is responsible for proceeding against all those involved. In his first detainee report, Prosecutor Tarek William Saab said that since 2017 the Public Ministry has investigated 27 “corruption plots” in PDVSA, with a balance of more than 200 detainees, among these, high managers of the oil industry.
The amount of the new embezzlement in PDVSA, according to the Madurista regime, is 21,000 million dollars. LaPatilla.com consulted the economist, university professor and oil expert, José Toro Hardy, to learn more about the actions of the allegedly corrupt detainees in the already tottering Venezuelan oil industry.
The amount of the new embezzlement in PDVSA, according to Maduro’s regime, is 21 billion (U.S. BILLION) dollars. Lapatilla.com consulted the economist, university professor and oil expert, José Toro Hardy, to learn more about the actions of the alleged corrupt detained in the already wobbly Venezuelan oil industry.
How do you see what happened in PDVSA with the so-called corruption plot?
– PDVSA used to be subject to thorough controls at all levels. For example, when a tanquero (oil tanker ship) was loaded the amount of oil that came out from the deposits was measured. Apart from the amount of oil that was loaded on the tanker internally, independent companies made an audit of the two figures, and the maximum allowed variation was 0.2%. If the difference was greater, an investigation was immediately opened.
Additionally, when a tanker was loaded, a letter of credit had to be open to guarantee the payment of the cargo and, additionally, the entire operation in PDVSA was duly audited internally and externally by the Central Bank of Venezuela, which received the dollars from of the payment of oil sales, by the Energy and Mines Committee of the Senate Chamber (former National Congress eliminated by Hugo Chávez), by the Energy and Mines Commission of the Chamber of Deputies, of course by the Comptroller General of The Republic, and also by Securities and Exchange Commission of the United States (SEC), because although we did not sell actions in the stock market, we did sell bonds, this implied that we were regularly audited.
That set of rigorous controls that did not allow situations like this (corruption plot) to occur. But now all those controls have disappeared.
There are 21 billion dollars missing, is it that the total amount or embezzlement has been much higher? How much more could this ascend?
– It is difficult to know, because for several years PDVSA does not even publish its annual reports, so that it is very difficult to know what is happening in there, when there are no controls of any nature.
Durind this period, which is the one that is investigating, there is talk of 21 billion dollars, of which 3.2 billion are lost but the difference, most likely, is not recoverable either.
The total amount can exceed this sum, but we do not know because there is no transparency in the PDVSA reports or those of the Central Bank of Venezuela.
I think they are investigating nothing more than one period, which is the one that corresponds to the last oil minister (Tareck El Aissami), and that is where we talk about that amount, but over time the amounts could be much greater than that.
How could the embezzlement happen? With negotiations in crypto-coins? Sale and transshipment of oil on the high seas to evade the sanctions imposed by the US in 2019?
– Certainly, with the intention of evading the sanctions of the United States, oil was sold through intermediaries and “pirate oil tankers”, to give them a name in some way, which turned off the “transponders” (automatic identification system) so that the ship’s course wasn’t registered and made oil transfers in the high seas, where sales clauses do not have a final destination base as they had before, because it used to be the oil that was sold could only reach the ports established in the contract, where the amount of oil that arrived was again audited.
As all that has disappeared, today there is no control, the tankers are dispatched without a letter of credit. At the same time, payments are made in cryptocurrencies in the name of other people, and that set of circumstances, that tremendous administrative disorder, inevitably leads to situations like those we are seeing.
What countries could be involved in these shady deals?
– Apparently, the final destination of these oil shipments which in many cases were resold on the high seas, seems to be Asia. In many cases, the shipments went to China, and in others to India. Mainly these two countries, but the payments, being made in cryptocurrencies, can take other directions, there is no way of knowing the exact destination.
Where do you presume that this money could be?
– In many places, because once the payments are made by cryptocurrencies, one can trace where the money went, but cannot know on whose name it came from.
How is PDVSA financial standing after this corruption plot?
– It looks very bad, because the company is severely in debt in the first place. Not only because of cases like this or because of legitimate debts that it has contracted, but also because there are numerous international arbitrations that it has lost. Let us remember that after the Hydrocarbons Law was modified during the government of late Hugo Chávez, the oil companies are called and told that there are new conditions for the contracts that they had signed when the “oil opening” was instituted and two alternatives were mentioned: they had to accept the new conditions or otherwise they had to leave the country.
Many accepted this because oil prices were very high at that time, but others did not, such as Conoco Phillips, Exxon Mobil and many others. These “others” went to international arbitration and systematically won, so that this has generated huge liabilities against PDVSA and the Republic, which have not been honored.
That puts at risk the property of Citgo, which is Venezuela’s main asset abroad, and which is under a protection measure by the United States Department of the Treasury.
Is it possible to return to the economic solvency of PDVSA?
– I believe that, first of all, it is possible to recover the oil industry. It is possible to recover PDVSA, but not the same corporation as before. It should be much smaller, with different functions that allows it to continue to exist.
Recovering the oil industry requires very high investments which, since the (Venezuelan) State is not in a position to do so, will have to be made by the private sector if we really want to recover it.
What would you say to Venezuelans who see this situation as a hard blow to the country’s economy?
– That we should take advantage of this to learn an immense lesson, so that these tragedies do not happen again in the future.