HomeInvestigationsThe Governors, the Gang and the War for Bolívar's Gold
INVESTIGATIONS

The Governors, the Gang and the War for Bolívar's Gold

ELITES AND CRIME / 17 NOV 2021 BY VENEZUELA INVESTIGATIVE UNIT EN

President Maduro's plan to help governors fund their states by gifting them each a gold mine soon ran into trouble. In the sprawling state of Bolívar, this led to immediate conflict. The criminal gangs that ran Venezuela's mining heartland would never surrender. One group, in particular, has led the resistance.

On November 5, 2019, threatening pamphlets appeared on the streets of El Callao, a mining town in Venezuela's eastern state of Bolívar. The town was already on edge. A week before, a severed head was found on a road in El Callao. The pamphlets contained a message from a local gang leader, Alejandro Rafael Ochoa Sequea, alias "Toto," to the municipal mayor, Alberto Hurtado.

"You handed over your land to the government," they read. "Resign, you have 48 hours to pack your bags because there is going to be more death, and if you don't go, I'm coming for your head."

That night, armed men on motorbikes raced around the streets, firing off their weapons and setting off a grenade.  

*This investigation exposes how the Maduro regime’s attempts to control Venezuela’s mining heartland in the state of Bolívar has led to criminal chaos, as guerrilla groups, heavily armed gangs and corrupt state elements battle over the country’s gold. Read the full investigation here.

This investigation exposes how the Maduro regime's attempts to control Venezuela's mining heartland in the state of Bolívar has led to criminal chaos, as guerrilla groups, heavily armed gangs and corrupt state elements battle over the country's gold.

Toto's message and his gang's terror campaign came shortly after President Nicolás Maduro had announced an unusual new policy: He would give each state governor a gold mine to help fund their administrations. There was one problem. Bolívar's gold mines were controlled by brutal criminal gangs known as sindicatos (unions). And the sindicatos such as Toto's had no intention of giving up the mines without a fight.

By pitting the governors against the gangs, the Venezuelan government fanned the flames of the war to control Bolívar's gold – a war that continues to this day. In El Callao, it is a war that has seen Toto's small gang of local thugs hold out for more than two years against the concentrated forces of the Venezuelan state. And this unlikely resistance has become a symbol of the Venezuelan state's inability to control one of its last economic lifelines: gold.

A Longtime Outsider

From the outset, Toto and his gang have been no strangers to conflict with the Venezuelan state. But in Bolívar, this made his gang an outlier.

At the time of his gang’s formation around 2014, Bolívar was governed by a former military comrade of ex-Venezuelan President Hugo Chávez: General Francisco Rangel Gómez. From 2008 to 2012, Rangel presided over Chávez's attempts to centralize state control over Venezuelan gold by expropriating international mining operations and requiring producers to sell most of their gold to the Venezuelan Central Bank (Banco Central de Venezuela – BCV).

SEE ALSO: The Unlikely Resistance of a Lone Mining Gang in Venezuela

The policies devastated Venezuela's gold sector. Foreign capital soon fled, and Minerven, the state-owned mining company, saw its production crater as it could not access financing. Industrial mining gave way to small-scale, unregulated operations controlled and exploited by rapacious criminal gangs. But in the havoc, Rangel saw an opportunity.

According to whistleblower testimonies from two former security force agents, a clandestine network existed within Rangel's inner circle armed gangs and doled out criminal concessions in Bolívar's mining zones. They asked for one thing in return: gold.

"In the state of Bolívar," one of the whistleblowers asserted, "it is almost impossible to apprehend a member of an organized crime group that is not connected to [then-chief of Bolívar's state police] Julio César Fuentes Manzulli, the strong arm of Governor Rangel."

This was not entirely accurate. In El Callao, a historic mining hub, criminal groups with roots in local mining communities began to push back against Rangel's criminal fiefdom. The most powerful was Toto's, which emerged in the southern sector of El Perú, home to many of the mines that Minerven had now abandoned.

What Toto lacked in political support, he made up for in close community ties and brutality. His gang held out in the face of sporadic police operations. It also took advantage of the weakening of Toto's rivals to take over their mines and even launched violent raids against groups backed by Rangel. By 2016, Toto had established himself as the dominant independent criminal power in El Callao.

"The only sector [the government] can't control is El Perú," a resident of El Callao, who did not want to be identified for security reasons, told InSight Crime in 2020. "Why? Because the whole gang are natives of El Perú. Local people protect the criminals because they saw them grow up."

In 2017, Rangel was forced from the governor's office. He was replaced by Justo Noguera Pietri, a figure from Venezuela's military elite. Noguera was tasked with bringing order to the anarchic mining gangs Rangel had allowed to flourish.

Under Noguera, police operations gave way to full military offensives. In August 2018, Toto's territories were raided by as many as 200 military and police personnel. The operation uncovered grizzly evidence of Toto's reign of terror, including a mass grave containing 14 human skulls.

Toto upped the ante. Over the next year, his gang made several displays of defiance, including the mutilation of a young army deserter and releasing a viral video of gang members shooting high-caliber weapons in the air.

But Toto was not inflexible. He was quite willing to grease the wheels where necessary. His furious salvo against Hurtado, the mayor of El Callao, in 2019 contained a striking allegation.

"We gave you half a kilo of gold for your campaign for Congress and you won. You came back here taking 650 grams from me to be mayor and you won. You sold us out, and you did nothing for us," read the pamphlets.

But Toto's ire was directed at the wrong target. By that time, plans for Venezuela's gold sector were being controlled at the national level.

The Golden Arc

The state's attempts to bring the Toto's gang and other sindicatos to heel were part of a broader scheme for Venezuela's gold trade.

In February 2016, Maduro had launched a new strategy to revitalize the sector, dubbed the Orinoco Mining Arc (Arco Minero del Orinoco – AMO). The project sought to boost mineral extraction throughout a swathe of southern Venezuela by inviting international mining companies to enter into joint ventures with the Venezuelan state. Ownership would be split 45-55 percent, with the government keeping the lion's share.

When the legal framework for the AMO was solidified in 2017, the government announced the mining industry would be "the answer to the economic war" of US sanctions and a move toward a post-petroleum Venezuela.

But the corrupt and conflict-wracked mining sector proved a hard sell to international businesses. What little corporate interest there was evaporated when international sanctions started to bite.

The only significant investments came not in mining operations but in new processing plants, which used a cyanide-based process to extract a higher percentage of gold from the raw material. This promised more efficient gold processing in the future, but it also offered quick profits by allowing gold to be extracted from the tailings – or residues – of previous mining operations. 

"When [the AMO] was created, the goal was that they could exploit and produce gold as well, but all they did was put up those plants," a local mining engineer told InSight Crime. "But they don't have mines. You have to have a mine to have something to process in the plants."

According to multiple media investigations, Cyanidation plants increased rapidly as they were backed by senior figures within the regime and their associates and allies. In the absence of industrial mining, the actors who controlled the plants instead focused on obtaining tailings from the waste piles and tailings lakes around the old Minerven mines and those left behind by the rustic processing mills operated by small-scale miners. For both, they had little choice but to negotiate with the sindicatos that controlled the territories.

"They're doing mining in reverse," a mining economist told InSight Crime. "First, they put up the processing plant, and then they go looking for material."

With the joint ventures ran aground and the tailings representing a windfall that would soon be exhausted, the state developed a new plan: "strategic alliances." This form of mining concession assigns to companies or individuals areas to secure and exploit by whatever means they can in exchange for sharing a percentage of the production with the Venezuelan Mining Corporation (Corporación Venezolana de Minería – CVM), the agency charged with maintaining the flow of gold to Venezuelan state coffers. 

These secretive contracts lured even more actors into El Callao. In 2018, the Ministry for Ecological Mining Development had registered 295 such agreements in Bolívar. One year later, this had risen to over 1,000. But few had any experience in mining. Instead, they were a motley assortment of military cronies and chancers, keen to try their luck.

The CVM could not afford to be picky. Having failed to attract investors of quality, the new strategy was quantity. The more people tried their luck, the more likely that at least a handful would strike the jackpot – and deliver a cut to the CVM. But as ever more self-interested actors piled into the AMO, illicit trafficking ran rampant, and internal tensions spiraled.

Fool's Gold for Governors

Against this backdrop, Maduro's gift of gold mines to his governors may have seemed grandiose, but it was born of desperation.

When announcing the initiative, Maduro declared that it would represent "a new model of strategic alliance." While his exact intentions are unknown, it is possible that he hoped these political loyalists would prove more trustworthy partners in developing the concessions. However, any hope that the governors would bring the investment needed to revitalize Bolívar's gold sector was badly misguided.

"[The governors] thought they were going to land and find a site with a mine and a fully-functioning processing plant producing bars of gold," a mining engineer, who spoke to InSight Crime on condition of anonymity, laughed. "When they saw they would have to put money into it, that killed the project before it was born."

Some of the governors, though, saw a different kind of business opportunity.

At the beginning of November 2019, Jorge Luis García Carneiro, then governor of the coastal state of Vargas, arrived in Bolívar. Instead of setting up a new mining operation, García took control of the existing La Gloria mine, one of the richest in El Callao.

"There was a gold boom in La Gloria, but it was taken by the government," explained a resident of El Callao, who did not want to be identified for security reasons. "They drove out the criminals, and they put in their own people."

La Gloria was not within Toto's territory, but the takeover sent a clear message to El Callao's sindicatos. They could either work with Maduro's allies or not at all.

"The strategic alliance thing is just a pseudonym that the government gives to these organizations," a miner in El Callao, who asked to remain anonymous out of fears for his safety, told InSight Crime. "The organization works with the thugs, and the thugs are the ones that put the miners to work. They're the ones that control the population. The thugs form part of the alliance because if not, the government kills them. It's that simple."

By this time, there was growing evidence that it was not only the Venezuelan security forces enforcing this arrangement but also Colombian guerrillas. In his November 2019 message, Toto called out this arrangement, accusing Governor Noguera of working with the National Liberation Army (Ejército de Liberación Nacional – ELN) to take their territories.

SEE ALSO: Venezuela Indigenous Communities at Risk From ELN Mining Incursions

Other sindicatos saw little choice but to fall in line, but Toto was not prepared to capitulate. Days after the visit by García Carneiro, the former governor, Toto issued his ultimatum to Hurtado as his gunmen terrorized the town. This brought plenty of attention as Toto and his gang became the military's top target.

"The gang in El Perú is the only one that does not pay the state," a former army officer who served in El Callao, speaking on condition of anonymity, said bluntly. "So, we had the green light for war."

El Callao was militarized. The majority of its shops and public buildings closed down. Hurtado went into hiding but did not resign. By the end of the year, a tense calm had been restored, but it did not last long.

The façade of peace in El Callao was shattered by the killing of a 76-year-old calypso musician. Carlos Clark, who for years had run a legal mining operation in the area, was gunned down in the street on May 8, 2020. Clark had been named part of Bolívar's "living cultural heritage" and was a popular figure locally. His murder sent shockwaves through the town.

Local authorities were quick to blame Toto's gang for the murder, claiming they killed Clark because he refused to pay the gang's extortion demands. But after his death, the state took possession of his mine then turned it over to Mibiturven, a joint venture with connections to Alex Saab, the man accused of being the Maduro regime's top money launderer. As a result, many in the region doubt the official version of events.

"They say that it was hitmen from Toto's gang [who killed Clark], but you have to look at who benefited from that killing, in whose hands the mine ended up," a local opposition political leader, who spoke on condition of anonymity, told InSight Crime.

Clark's murder acted as a trigger for intensified police operations targeting Toto's gang and their network.

The conflict once again ignited, and months of bloody clashes between the security forces and Toto's gang followed, with numerous deaths on both sides, weapons seized and dozens of gang members arrested.

By September 2020, Toto appeared to be on his knees. In a striking shift in tactics for the gang, he released a video appealing for peace. Seated at a plastic table in the jungle, flanked by heavily-armed youths and with a Venezuelan flag as a backdrop, a masked man addressed the camera.

"On behalf of El Perú, we're calling for dialogue because we have found ourselves in a senseless war for defending our human rights, our work, our people," he read from a sheet of paper. "We don't want more deaths; we want the bloodshed to stop."

But the plea was also a threat.

"This doesn't mean we're not prepared for war," he warned. "With the forces we have, we're capable of defending our land."

The government did not acknowledge the video. Days later, two gang members were gunned down by military units in El Perú, quickly followed by 13 arrests. The attacks continued for months.

Toto's appeal had been rejected.

An Unlikely Defender of Human Rights

On March 27, 2021, armed men intercepted a former congressman, Wuihelm Torrellas Martínez, as he drove down the main street of El Perú. Torrellas and his bodyguard were abducted to a mountainous area outside of El Callao, long used as a hideout by Toto's gang.

According to Torrellas' account to authorities, recounted by local journalist Pableysa Ostos, his captors accused him of being an informant for Venezuela's Directorate of Military Counterintelligence (Dirección de Contrainteligencia Militar – DGCIM). They demanded 15 kilograms of gold for his release. When the ransom was not forthcoming, they beheaded Torrellas' bodyguard.

Torrellas claimed that he managed to escape his captors in the early hours of the morning and hide out in the mountains until sunrise.

Days later, a military unit was dispatched to the site where Torrellas had been held. They found the site abandoned, with Torrellas' truck parked outside. One of the officers opened the driver's door. It was boobytrapped with a grenade, an official assigned to the case told Ostos. Four officers were injured in the explosion.

The incident was a vivid demonstration that after more than a year of military pressure, Toto was still capable of humiliating state forces that sought to dislodge him.

Increasingly, his fury seemed to be concentrated on the DGCIM. As the chaos spiraled in the AMO, Venezuela's feared military counterintelligence unit had been taking an ever-greater role in Bolívar, including coordinating attacks on Toto's supporters and securing areas won by state forces.

The DGCIM has a dark reputation for disappearances, torture and other abuses. Unable to defeat Toto himself, the DGCIM turned its repression against the small miners.

"There's a lot of persecution by the DGCIM against anyone who tries to extract material," a journalist specializing in the region, who spoke on condition of anonymity, told InSight Crime. "It's like a police state."

This has ironically given Toto the chance to play the good guy. In April 2021, he released another video with a markedly different tone to his previous conciliatory effort.

"Stop the raids, the robberies of stores, gold mills and houses. If not, we're going to launch a campaign of terror, fear and bombing against all the authorities in El Callao. When tyranny becomes law, rebellion becomes a duty," the speaker threatened.

From the leader of a small gang, rooted in a single sector of a single municipality in eastern Venezuela, the revolutionary rhetoric was absurd, as was the claim of a murderer and extortionist to be protecting human rights. But it was perhaps no more absurd than Maduro's plan that state governors could fund broke administrations with their own gold mines.

And despite ongoing military offensives and mass arrests of miners, as of this writing, Toto is still holding out in El Perú, sporadically carrying out acts of spectacular violence.

For their part, the governors are giving little sign of life. And with security in disarray and state actors concentrated on pillaging whatever they can, the Maduro government's grasp on the gold trade seems to be ever more tenuous.

*This investigation exposes how the Maduro regime's attempts to control Venezuela's mining heartland in the state of Bolívar has led to criminal chaos, as guerrilla groups, heavily armed gangs and corrupt state elements battle over the country's gold. Read the full investigation here.

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