French\, Russian firms entangled in multi-million dollar fraud in Venezuela

French, Russian firms entangled in multi-million dollar fraud in Venezuela

The case stemmed from cash-strapped PDVSA's chronic delays in paying dividends to foreign firms

Reuters  |  Washington 

Anglo-French company and Russian financial firm have been identified in testimony by a former Venezuelan company official who said he received millions of dollars in bribes in return for giving them preferential treatment, a source with knowledge of the matter said on Thursday.

Abraham Ortega, a former at company PDVSA, accepted $5 million in bribes to favour a French oil company and from a Russian bank, US prosecutors in said on Wednesday in a statement, which did not name either company. Ortega received $3 million to help the French company and $2 million to favour the Russian one, according to the announcement.

Prosecutors said that in exchange, Ortega helped the companies gain "priority status" to loan money to oil joint ventures in which they were partners with

The high-profile case is one of a slew of US probes into corruption in Venezuela, which is reeling from hyperinflation, empty shelves and mass emigration, but the case is one of the first to link corruption in the to prominent foreign firms.

declined to comment. and did not immediately respond to requests for comment.

The case stemmed from cash-strapped PDVSA's chronic delays in paying dividends to foreign firms, a second source said.

was desperate to receive those funds and get the money out of Venezuela, according to the source. Perenco agreed to loan money to the Petrowarao joint venture it ran with PDVSA, but as part of the deal had to be paid its late dividend payments beforehand.

The company received those payments in late 2013, the source said. Former oil Rafael Ramirez, who is now on the run from Nicolas Maduro's government, announced in 2014 that Perenco was loaning $420 million to Petrowarao to quintuple its to 24,000 barrels per day.

However, the source said that Perenco ended up loaning a small fraction of the promised amount.

In total, Ortega said he accepted $17 million in bribes as part of a broad embezzlement scheme. The money was hidden in the United States, and the Bahamas, according to the U.S. prosecutors.

First Published: Fri, November 02 2018. 06:12 IST