Venezuela: High-Level Arrests at PDVSA Refinery for Alleged Graft

Former PDVSA Vice President Jesus Luongo and four others stand accused of embezzling large sums of state funds.

Venezuela's attorney general Tarek William Saab

Venezuela's attorney general Tarek William Saab
Venezuela's attorney general Tarek William Saab at a press conference (Archive)
By Cira Pascual Marquina
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Caracas, March 22, 2018 (venezuelanalysis.com) – Venezuela's attorney general, Tarek William Saab, announced Tuesday new arrests in an ongoing anti-graft investigation into the country’s oil industry . These arrests are the latest episode in the government’s sweeping anti-corruption campaign, which includes dozens facing charges in state oil company PDVSA as well as other state-run enterprises.

The latest figures apprehended include a former PDVSA executive as well as other top administrators at the Paraguana oil refinery in Falcon state in western Venezuela. According to Saab, four people have been arrested and a warrant issued for a fifth.

“Criminal [PDVSA] administrators colluded with criminal businesspeople to embezzle from the nation,” the top prosecutor declared in a press conference on March 20.

According to Saab, managers at the Paraguana Refining Center signed a “fraudulent” contract with private firm Espidel Espinoza Delgado, CA. for the supply of diesel, with the latter “obtaining a profit of 431,858 percent for the sale of a product that is produced by the very refinery.”

Saab added that the contract, which expired in September 2016, was renewed until November of that year with price markups yielding a profit of six thousand percent.

Among those arrested are former PDVSA Refining, Commerce and Supplies Vice President Jesus Enrique Luongo, Cost Estimate Analyst Keila Gatica, Technical Services and Support Manager Lexy Briceño, and Espidel President Jose Espinoza.

Saab also indicated that an Interpol red alert has been issued for Cost Estimate Superintendent Kheyla Martinez,who reportedly fled the country in December .

All five stand accused of willful embezzlement and criminal association, while Luongo has also been reportedly implicated in the Andorra Bank money laundering scandal allegedly involving former oil czar Rafael Ramirez.

The anti-corruption drive focusing on PDVSA started in the September of 2017, shortly after Saab was appointed as chief prosecutor. Since then, 80 state oil company managers have been arrested , 22 of whom are high-level officers and executives.

The anti-graft probe saw its highest level arrests last November with the apprehension of former oil ministers Eulogio Del Pino and Nelson Martinez. Meanwhile, an Interpol capture order was issued in January for Ramirez, who served as oil minister and PDVSA chief for over a decade.

President Nicolas Maduro has since tapped former National Guard General Manuel Quevedo to head up the embattled state oil company, whose production reached record lows in January at 1.6 million barrels daily, according to the OPEC’s March Oil Report.

Maduro’s battle against corruption has earned him praise among some analysts and observers, but others have speculated that it is merely an electoral maneuver aimed at improving the government’s image and eliminating rivals with potential presidential ambitions such as Ramirez.

Attorney General Saab said that the current criminal cases would be followed by civil ones.

“In addition to the arrest warrants, we have begun to seize the assets derived from these acts of corruption, and we hope that, following definitive rulings on these cases, there will be civil cases aimed at repatriating the money stolen from the nation,” he revealed during Tuesday’s press conference.