Venezuela Unveils Second Wave of Detentions Linked to Crypto Money Laundering Scheme

The Venezuelan Attorney General, Tarek William Saab, announced the arrest of prominent figures, including former PDVSA president Tareck El Aissami, former Economy Minister Simon Alejandro Zerpa, and entrepreneur Samark Lopez, in connection with a crypto money laundering scheme. The scheme involved the laundering of funds from unregistered oil sales through exchanges like Kraken and investments in cryptocurrency mining farms.

Saab revealed that the embezzlement scheme, spearheaded by El Aissami and former cryptocurrency watchdog Joselit Ramirez, utilized cash and cryptocurrency payments to evade national controls. The scheme exploited sanctions against Venezuela to sidestep standard procedures, with informants disclosing the conversion of $35 million into crypto through facade companies.

While exact figures were not provided, previous reports estimated losses of close to $20 billion due to unregistered sales, which were subsequently laundered using cryptocurrency purchases. Saab emphasized the challenge of investigating these cases due to the involvement of digital currencies.

The perpetrators utilized platforms like Kraken for money laundering, making transactions “undetectable” for oversight organizations. Additionally, cryptocurrency payments made abroad were used to handle oil sales and avoid detection. Furthermore, embezzled funds were invested in cryptocurrency mining farms with El Aissami’s knowledge.

The arrests follow a year-long probe, with previous apprehensions made in connection to the case. This marks the first public acknowledgment of crypto’s involvement in Venezuelan oil payments, although there are records of cryptocurrency use in brokering Venezuelan oil sales in the past. It highlights the need for robust regulatory frameworks to prevent money laundering and protect the integrity of financial systems.