HomeNewsAnalysisPDVSA Subsidiaries in Central America Slapped With Sanctions
ANALYSIS

PDVSA Subsidiaries in Central America Slapped With Sanctions

EL SALVADOR / 13 MAR 2019 BY HÉCTOR SILVA ÁVALOS EN

The US Treasury Department extended economic sanctions imposed on PDVSA, Venezuela’s state-run oil company, to two of its subsidiaries in Central America, increasing the pressure on some of the staunchest foreign allies of President Nicolás Maduro’s regime.

A spokesman for the Treasury Department confirmed to InSight Crime that sanctions had been slapped on Alba Petróleos in El Salvador and Albanisa in Nicaragua, both PDVSA’s subsidiaries under the control of the governing parties in each of the countries.

“As a result of our designation of PDVSA, the sanctions also apply to any entity in which PDVSA has direct or indirect ownership of 50 percent or more,” the spokesman said.

SEE ALSO: Venezuela: A Mafia State?

On January 28, the Office of Foreign Assets Control (OFAC) of the Treasury Department issued sanctions against PDVSA stating that “Venezuela’s state-run oil company… has long been a vehicle for corruption… for the personal gain of corrupt Venezuelan officials and businessmen.”

Official documents of the Venezuelan oil company state that PDV Caribe, one of PDVSA’s subsidiaries, owns 60 percent of Alba Petróleos. The latter is a private-public venture funded in 2006 in El Salvador and is heavily linked to the Farabundo Martí National Liberation Front (Frente Farabundo Martí para la Liberación Nacional - FMLN).

In Nicaragua, PDVSA owns 51 percent of Alba de Nicaragua (Albanisa). The other 49 percent is owned by municipalities under the control of Daniel Ortega’s regime, according to an investigation by Connectas, and confirmed by official documents InSight Crime had access to.

The sanctions state, among other things, that no American person or company can carry out any trade or transactions of any kind with these companies.

For more than a decade, PDVSA has been at the center of a series of regional corruption scandals and has faced repeated accusations of money laundering.

InSight Crime Analysis

These sanctions on PDVSA subsidiaries, Alba Petróleos and Albanisa, shine a spotlight once again on the Central American partners of Nicolás Maduro’s regime. This also ratchets up international pressure on Salvadorian and Nicaraguan interest groups which have supported Venezuela.

Since Alba Petróleos was founded, it has been under the control of José Luis Merino, known as "Ramiro Vásquez", a former FMLN guerrilla captain, who later became a federal deputy and government official.

SEE ALSO: Coverage of Elites and Organized Crime

Over the past decade, Merino has been scrutinized by multiple US agencies and his name is even mentioned in a file opened by the El Salvador Attorney General’s Office for alleged arms trafficking.

Merino, nonetheless, holds immunity in El Salvador, since the current president, Salvador Sánchez Cerén, appointed him deputy foreign affairs minister in 2016.

In 2017, 14 US congressmen requested that the Trump administration investigate Merino for “longstanding associations with organized crime networks subject to criminal investigations in the US.”

In March 2018, American authorities detained Fred Merino, brother of José Luis, in Houston in connection with the same investigation. Fred Merino has also long been a major figure within Alba Petróleos.

Venezuelan oil and the profits it has brought to Alba Petróleos have also served to finance FMLN election campaigns, it was confirmed last January, by a consultant close to the presidential candidate of said party for the February 3 elections.

Asdrúbal Chávez Jiménez was one of the first directors of Alba Petróleos, cousin of the late Hugo Chávez and one of the directors of PDVSA since 2004. Nicolás Maduro appointed him minister of oil and mining in 2014. That same year, according to an investigation led by US federal prosecutors, $1.2 billion were redirected from the Venezuelan state-run oil company to personal accounts of Maduro’s regimen officials.

In Nicaragua, according to Connectas, Albanisa was one of the main financial fronts for the regime of Daniel Ortega, who used Venezuelan money to feed the social aid programs and political alliances that have kept him in power.

Last July, the Treasury Department issued sanctions against Francisco López Centeno, Albanisa’s vice president and a close ally to Daniel Ortega, for “misappropriation of state assets…corruption related to government contracts...[and] bribery.”

In practice, the US sanctions will have different consequences for Alba Petróleos and Albanisa.

In El Salvador, the FMLN’s government ends on June 1 and the local oil company is almost bankrupt. This means the main implications for officials linked to this Venezuelan oil scandal will likely be prosecutions on corruption charges.

In Nicaragua, Albanisa’s financial drought and the sanctions it now faces adds pressure to the Ortega government, which has been in turmoil since launching a brutal repression campaign against its own citizens. However, Ortega has previously survived several rounds of sanctions coming from Washington DC.

share icon icon icon

Was this content helpful?

We want to sustain Latin America’s largest organized crime database, but in order to do so, we need resources.

DONATE

What are your thoughts? Click here to send InSight Crime your comments.

We encourage readers to copy and distribute our work for non-commercial purposes, with attribution to InSight Crime in the byline and links to the original at both the top and bottom of the article. Check the Creative Commons website for more details of how to share our work, and please send us an email if you use an article.

Was this content helpful?

We want to sustain Latin America’s largest organized crime database, but in order to do so, we need resources.

DONATE

Related Content

CARTEL DE LOS SOLES / 27 FEB 2018

The United States government could impose sanctions on the second most powerful person in Venezuela, according to a diplomat at…

ELITES AND CRIME / 7 SEP 2021

The visual is an arresting one. A Venezuelan army sergeant, his face swollen and his nose bleeding from a beating,…

CARTEL DE LOS SOLES / 28 FEB 2019

Is it just me or does Nicolas Maduro look a lot like Saddam Hussein? After US intervention in Iraq, we…

About InSight Crime

THE ORGANIZATION

Unraveling the Web of Elites Connected to Organized Crime

27 JUL 2021

InSight Crime published Elites and Organized Crime in Nicaragua, a deep dive into the relationships between criminal actors and elites in that Central American nation.

THE ORGANIZATION

InSight Crime’s Greater Focus on US-Mexico Border

20 JUL 2021

InSight Crime has decided to turn many of its investigative resources towards understanding and chronicling the criminal dynamics along the US-Mexico border.

THE ORGANIZATION

Key Arrests and Police Budget Increases Due to InSight Crime Investigations

8 JUL 2021

With Memo Fantasma’s arrest, InSight Crime has proven that our investigations can and will uncover major criminal threats in the Americas.

THE ORGANIZATION

Organized Crime’s Influence on Gender-Based Violence

30 JUN 2021

InSight Crime investigator Laura N. Ávila spoke on organized crime and gender-based violence at the launch of a research project by the United Nations Development Programme.

THE ORGANIZATION

Conversation with Paraguay Judicial Operators on PCC

24 JUN 2021

InSight Crime Co-director Steven Dudley formed part of a panel attended by over 500 students, all of whom work in Paraguay's judicial system.