Venezuela arrests 21 people in crypto-related oil corruption scheme

Venezuelan prosecutors arrested 21 people for being involved in a wide-range crypto-related corruption scheme on state oil company Petroles de Venezuela SA (PDVSA) on Mar. 24, as Reuters reported.

Eleven of the arrested individuals were businessmen, while the remaining ten were government officials, according to the Reuters article. Moreover, the Venezuelan government has released arrest warrants for 11 more individuals allegedly participating in the same scheme.

What happened?

The arrest warrants were released as a result of an investigation started in October 2022, which was focused on PDVSA, the judiciary, and the country’s crypto watchdog, Sunacrip.

Speaking about the arrests at a press conference, Attorney General Tarek Saab stated:

“We are talking about one of the most lurid plots in recent years, which involves officials, businessmen who benefited from corruption and young people – including the so-called mafia women – who participated in corruption and money laundering,”

Saab didn’t disclose company names or details about the exact scope of the scheme. However, he stated that Sunacrip was assigned oil cargoes for sale without administrative control, which allowed receivers to purchase these cargoes without making a registered payment.

The US government detected that Venezuelan oil shipments were paid via cryptocurrencies, leading the US to impose sanctions against Venezuela in 2019. In February 2023, local news outlets reported that two oil brokers were facing charges for settling illegal oil deals with the PDVSA using Tether (USDT) to dodge sanctions and settlement payments.

Prior arrests

Reuters also noted that Saab’s office has investigated over 30 cases linked to the country’s oil corruption, which led to the prosecution of almost 200 people. A handful of government officials and businessmen were also arrested or removed from their positions in the last week.

On Mar. 20, Venezuelan anti-corruption prosecutors sent a letter to the attorney general. They requested the PDVSA officials be investigated, which led to the resignation of the company’s president on the same day. Two days later, the Venezuelan president assigned PDVSA’s new chairman, Pedro Tellechea, as the country’s new oil minister.

Sunacrip, National Superintendency of Crypto Assets and Related Activities, is the country’s designated official body to regulate crypto assets. On Mar. 18, the local news sources reported that Sunacrip’s head Joselit Ramirez, along with several other government officials, got arrested for being involved in corruption schemes.