Venezuelan prosecutors have arrested former Vice President Tareck El Aissami, who is believed to be the mastermind behind a “crypto plot” to embezzle money from state oil sales. El Aissami had been on the run for about a year after allegedly converting cash into cryptocurrencies. Prosecutors suspect that El Aissami and other government officials transferred coins onto the Kraken crypto exchange after converting them elsewhere. The case has become known as the “PDVSA-crypto corruption incident,” with President Nicolás Maduro’s government conducting raids on various government agencies and ministries.
The story revolves around Petróleos de Venezuela SA (PDVSA), the state-owned oil producer in Venezuela. The firm has used cryptocurrencies in the past to navigate around sanctions imposed by the United States. This led to the accumulation of a significant amount of Bitcoin and Ethereum coins, creating uncertainty about how to manage these assets. The former President of Sunacrip, the state’s crypto agency, was also arrested last year, along with other senior officials. El Aissami, along with a businessman and the former Minister of Economy, were arrested on suspicion of stealing billions of dollars from the state.
The government of Venezuela believes that it lost at least $3 billion in oil revenues due to corrupt deals dating back to 2018. El Aissami, López, and Zerpa, along with 50 other defendants, are accused of operating a corruption network. Police have arrested military officers involved in mining cryptoassets for the state, as well as PDVSA employees who misused state oil funds. The defendants reportedly sold crude oil directly to international buyers and concealed the proceeds in crypto wallets to avoid detection.
Attorney-General Tarek William Saab accused El Aissami and his associates of using shell companies and overseas cryptocurrency payments to manipulate and hide funds. The group allegedly speculated with the funds and used intermediaries to convert cash into crypto, which was then transferred to the Kraken exchange to avoid detection. Saab claimed that the conspirators aimed to undermine the national economy and devalue the fiat bolívar, putting pressure on other currencies and disrupting the government’s economic policies. The government officially discontinued the Petro cryptocurrency and has halted many crypto mining operations as part of their crackdown on corruption.
The charges against El Aissami, López, and Zerpa include treason and misappropriation of public funds. The prosecutor’s office plans to hold these individuals accountable for their actions and seek justice for the stolen funds. The involvement of high-ranking government officials in the embezzlement scheme has raised concerns about the integrity of Venezuela’s financial system and the misuse of cryptocurrency for illicit purposes. The government’s efforts to dismantle the corruption network and recover stolen assets are essential steps towards restoring transparency and accountability in the country.
