Venezuelan prosecutors arrest 21 people in crypto-related corruption scheme

Venezuelan prosecutors have arrested 21 people in connection with a wide-ranging cryptocurrency-related corruption scheme on state oil company Petroles de Venezuela SA (PDVSA), according to Reuters.

The expanding anti-corruption probe in Venezuela has led to the detention of 10 officials and 11 businessmen. The country’s attorney general has also issued arrest warrants for 11 more people.

The investigation, which began in October, is focused on state oil company PDVSA, a government entity supervising cryptocurrency operations, and the judiciary. This week, it led to the resignation of the country’s powerful oil minister, Tareck El Aissami, who had served the government for two decades.

According to Attorney General Tarek Saab, the corruption scheme involved officials, businessmen, and young people, including the so-called mafia women, who participated in corruption and money laundering. Saab described it as “one of the most lurid plots in recent years.”

The investigation revealed that a Venezuelan entity supervising the use of cryptocurrency for official transactions was assigned oil cargoes for sale with no administrative control. Many of the buyers did not pay for the oil correspondingly, leading to accusations of appropriation of public assets, money laundering, influence peddling, and criminal association.

PDVSA has accumulated $21.2 billion in commercial accounts receivable since 2020, including $3.6 billion potentially unrecoverable, after turning to dozens of little-known intermediaries to export its oil under US sanctions.

President Nicolas Maduro, who said he has been directly overseeing the probe, this week appointed PDVSA’s head Pedro Tellechea as new oil minister, delegating in him the supervision of the whole industry.

This is not the first time the attorney general’s office has investigated corruption in Venezuela’s oil industry. In the last five years, Saab’s office has investigated 31 cases linked to corruption, leading to almost 200 people prosecuted. The country’s designated official body to regulate crypto assets, Sunacrip, has also been hit by corruption allegations, with its head Joselit Ramirez and several other government officials arrested on Mar. 18.

These arrests and investigations are part of the Venezuelan government’s efforts to combat corruption in its oil industry and beyond. As the country’s main source of hard-currency revenue, it is essential to ensure that the industry operates transparently and ethically. The world will be watching closely to see if these efforts result in real change.

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