COLOMBIA FIRM TO DITCH BOARD MEMBER INDICTED BY USA DOJ IN $1.2B VENEZUELA MONEY LAUNDERING NETWORK, who is called a professional money launderer
Gustavo Hernandez Frieri
A Colombian brokerage is revamping its board and ownership structure in a bid to distance itself from a board member arrested for his alleged involvement in a $1.2 billion money laundering scheme.
On July 30, Global Securities Colombia (GSC) announced it was electing a new director lineup following the arrest of board member Gustavo Hernandez Frieri, who allegedly helped launder money embezzled from state-owned oil company Petróleos de Venezuela (PDVSA).
Hernandez had been a shareholder in GSC, a representative for the firm confirmed to Citywire Americas without clarifying when he exited his position.
In addition, according to the Colombian market regulator and the financial statements, the Bogotá broker has had client referral agreements with Global Strategic Investments since at least 2006.
‘The board, as a cautionary measure, decided to suspend the contract until the situation is clear,’ the spokesperson said.
In another move to further distance itself from the allegations, GSC asked its parent company to transfer its stake in the firm into an independent trust. With the move, GSC is aiming to reorganize its ownership structure, the company said.
In addition to Hernandez, former Julius Baer banker Matthias Krull was arrested in connection with the case. Six other people were also charged, including Francisco Convit Guruceaga, who according to the DOJ complaint is a member of the Venezuelan elite.
Guruceaga was among the people who allegedly embezzled $1.2 billion from Venezuela’s PDVSA through false loans and joint ventures.
According to the complaint, Hernandez and Krull were involved in laundering the money using fake investments.
The document described Hernandez as ‘professional money launderer’ who had used his two Miami firms to launder funds in the past. Meanwhile, Krull managed ‘banking’ activities for Venezuelan officials and kleptocrats, the DOJ said.
BACKGROUND: Two Members of Billion-Dollar Venezuelan Money Laundering Scheme Arrested
Two alleged participants in a billion-dollar international scheme to launder funds embezzled from Venezuelan state-owned oil company PDVSA using Miami, Florida real estate and sophisticated false-investment schemes were arrested yesterday and today.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Benjamin Greenberg of the Southern District of Florida and Special Agent in Charge Mark Selby of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations’ (HSI) Miami Field Office made the announcement.
Matthias Krull, 44, a German national and Panamanian resident, and Gustavo Adolfo Hernandez Frieri, 45, a Colombian national and naturalized U.S. citizen, were charged in a criminal complaint with conspiracy to commit money laundering. The complaint also charged Francisco Convit Guruceaga, 40; Jose Vincente Amparan Croquer, aka, “Chente,” 44; Carmelo Urdaneta Aqui, 44; and Abraham Eduardo Ortega, 51, all Venezuelan nationals; and Hugo Andre Ramalho Gois, 39, a Portuguese national, and Marcelo Federico Gutierrez Acosta y Lara, 40, a Uruguayan national, for their alleged participation in the scheme. These defendants remain at large. Krull was arrested last night in Miami and had his initial court appearance earlier today before U.S. Magistrate Judge Alicia M. Otazo-Reyes in Miami. Krull is scheduled to have a pre-trial detention hearing on July 30, and a preliminary hearing on Aug. 8. Frieri was arrested today in Sicily, Italy and faces extradition proceedings.
According to the criminal complaint, the conspiracy in this case allegedly began in December 2014 with a currency exchange scheme that was designed to embezzle around $600 million from PDVSA, obtained through bribery and fraud, and the defendants’ efforts to launder a portion of the proceeds of that scheme. By May 2015, the conspiracy had allegedly doubled in amount to $1.2 billion embezzled from PDVSA. PDVSA is Venezuela’s primary source of income and foreign currency (namely, U.S. Dollars and Euros).
The complaint alleges that surrounding and supporting these false-investment laundering schemes are complicit money managers, brokerage firms, banks and real estate investment firms in the United States and elsewhere, operating as a network of professional money launderers.
The alleged conspirators include former PDVSA officials, professional third-party money launderers, and members of the Venezuelan elite, sometimes known as “boliburgués.”
The charges contained in the complaint are merely allegations and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
This case is the result of the ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF) “Operation Money Flight,” a partnership between and among federal, state and local law enforcement agencies. The OCDETF mission is to identify, investigate and prosecute high-level members of drug trafficking enterprises, bringing together the combined expertise and unique abilities of federal, state and local law enforcement.
HSI Miami, HSI London, HSI Rome and HSI Madrid investigated this case. The case is being prosecuted by Assistant Chief David Johnson of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Francisco R. Maderal of the Southern District of Florida’s International Narcotics and Money Laundering Section.
The Criminal Division’s Office of International Affairs provided substantial assistance in this matter and U.S. Customs and Border Protection, the National Crime Agency of the United Kingdom and Italian, Spanish and Maltese law enforcement authorities provided assistance. The Fraud Section is responsible for investigating and prosecuting all FCPA matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.
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