Before the largest corruption scheme involving Venezuela's socialist regime became the focal point of a U.S. federal investigation, the legality of the $4.5 billion operation was certified by a well-respected lawyer in Caracas, who later became an opposition congresswoman.
Tamara Adrian, a member of the opposition in the Venezuelan National Assembly before becoming the first elected transgender legislator in Latin America, certified the legality of the operation, which consisted in having wealthy Venezuelans lend money in bolivars to state-owned Petroleos de Venezuela SA (PDVSA), which were soon after repaid in U.S. dollars at a highly favorable exchange rate.
Those transactions allowed Venezuelan bankers Luis Oberto and Ignacio Oberto to become immensely wealthy, with the help of Swiss banker Charles Henry Beaumont, according to investigations conducted by the U.S. Department of Justice.
"The U.S. Authorities have been investigating De Beaumont, Luis, Ignacio and others ( ... ) for their participation in a conspiracy, from approximately 2012 to 2014, to commit wire fraud and launder the proceeds of that fraud and fraudulent foreign currency exchange schemes to embezzle Venezuela's foreign currency reserves," the U.S. Department of Justice said in a letter sent on May 2018 to the Central Authority of Switzerland asking for its assistance.
"Brothers Luis and Ignacio Oberto, Venezuelan nationals, served as the beneficiary parties to the multi-billion dollar contract. The investigation indicates that this Venezuelan foreign exchange embezzlement scheme was nothing more than a mechanism to embezzle Venezuela's foreign currency reserves and launder the proceeds", it added.
According to the document obtained by the Miami Herald and el Nuevo Herald, the scheme had been disguised as a financing arrangement in which the conspirators would lend PDVSA bolivars and be repaid in U.S. dollars at the lucrative fixed government exchange rate.
Sources familiar with the situation had previously confirmed to the Miami Herald that the Oberto brothers were at the center of the massive corruption and money laundering scheme deemed the largest corruption case involving the Nicolas Maduro regime seen so far. The brothers and others are suspected of paying bribes to PDVSA officials to gain access to loan opportunities with the state-owned oil company and to the nation's favorable currency exchange system, sources said.
A similar case involving Maduro's stepchildren as well as Venezuelan businessmen Francisco Convit, Alejandro Betancourt and Raul Gorrin, involving the smaller amount of $ 1.2 billion, is under federal investigation in South Florida.
The Oberto brothers, who have not been charged in the U.S. investigation, are represented by two prominent criminal defense attorneys in South Florida. In a joint statement, Ed Shohat, representing Luis Oberto Jr., and David O. Markus, representing Ignacio Oberto, said their clients have done nothing wrong.
"Luis and Ignacio Oberto are both highly respected businessmen who have never been accused in any country of any crime," their lawyers said. "And for good reason _ they are honorable, ethical, and transparent. They have committed no crime. Any suggestion to the contrary will be met with a full-court-press defense."
Congresswoman Adrian has also dismissed claims of wrongdoing. In February 2012 Adrian drafted a legal opinion supporting making the loans, which according to investigators allowed the beneficiaries to multiply by a factor between five and ten whatever amount they lent to PDVSA.
According to the written legal opinion obtained by the Miami Herald and el Nuevo Herald, there is nothing in Venezuelan law that forbids that type of transaction.
"We are of the opinion that PDVSA should be entitled to pay a debt originally created in bolivars in a different currency without incurring in an unlawful Exchange Operation," declares the opinion drafted by Adrian on behalf of the firm Adrian & Adrian based in Caracas.
People familiar with the loan scheme said that the Adrian & Adrian legal opinion was used to convince Venezuelan businessmen and transnational companies that it was legal to purchase the dollars previously provided by PDVSA to repay the loans.
In a brief conversation with the Miami Herald and el Nuevo Herald, Adrian insisted that the operations analyzed by her firm were totally legitimate and rejected the premise that they have been used in fraudulent schemes involving the embezzlement of billions of dollars or that the loans are under investigation.
"That is false. The profit (from operations) is not what you say. That is why it has never been investigated," said Adrian. "Later, if I understand, operations were carried out, which no longer followed the pattern of the market economy."
The congresswoman asserted that the loans were paid in dollars by PDVSA using the free market exchange rate, which was much higher than the controlled preferential exchange rate at the time.
The State Department, however, thinks otherwise, after gathering the testimonies and documents from multiple collaborating witnesses.
In another letter from the Department of Justice to the Central Authority of Switzerland, U.S. officials explained that scheme made money at the expense of Venezuela's foreign reserves.
Under the scheme, a banker could lend PDVSA six million bolivars, then be repaid a million dollars within months. But under the real exchange rate, $1 million in U.S. dollars would actually be worth as much as 60 million bolivars, the document said.
