HomeNewsBriefThe Fall of Álex Saab, the Venezuelan Regime’s Trusted Money Man
BRIEF

The Fall of Álex Saab, the Venezuelan Regime's Trusted Money Man

ELITES AND CRIME / 15 JUN 2020 BY VENEZUELA INVESTIGATIVE UNIT EN

With the arrest of Colombian businessman Álex Saab, Venezuela President Nicolás Maduro has lost a suspected international money launderer who authorities say designed schemes to provide his government with much-needed illicit cash flows in the face of US sanctions. 

Saab was captured June 12 at the Amílcar Cabral airport on Cabo Verde's Sal island in West Africa, when the private jet he was traveling in landed there. Nicole Navas, a US Justice Department spokesperson, confirmed Saab's arrest. In July 2019, federal prosecutors indicted Saab on charges of running a global multi-million dollar money laundering operation that diverted state funds to overseas accounts.  

Additionally, Saab is accused of using shell companies to send overpriced, inedible food to Venezuela through the government's Local Storage and Production Committees (Comités Locales de Abastecimiento y Producción — CLAP) aid program. 

Saab's Miami-based lawyer, María Domínguez, declined to comment on her client's arrest, but she has previously denied the charges against Saab, saying that he is a "food business entrepreneur," Bloomberg reported.

SEE ALSO: Álex Saab Profile

According to Colombian newspaper El Tiempo, US intelligence operatives had been tracking Saab's movements by plane to Venezuela, Germany, Russia, Italy and Iran.

It's unclear why exactly Saab touched down in Cabo Verde.

A source within Colombia's government told El Tiempo that he went to the island nation to meet with a commission from Iran to free an oil tanker ship detained on the island. Other reports had him flying from Venezuela to Iran and stopping to refuel in Cabo Verde. El Tiempo reported that his plane had taken off from Tehran.

Shortly after Saab's arrest, the Venezuelan government said in a news release that Saab was on layover in Cabo Verde as a part of a trip to procure food, medicine "and other goods of a humanitarian nature to attend" to the coronavirus pandemic. The statement called the arrest unlawful and an act of aggression by the United States. 

While the Venezuelan government demands that Saab be freed, Washington has already begun to discuss his extradition with authorities in Cabo Verde, the island nation's Attorney General José Landim told the news portal A Nação.

InSight Crime Analysis

The arrest of Álex Saab not only takes away a key Maduro ally but is a blow to the government's ability to prop itself up through illicit proceeds. 

Alberto Ray, a Venezuelan analyst and security expert, told InSight Crime that Saab's arrest was "going to create major cash flow problems," as he was the architect of the regime's most important "money-making schemes, especially through drugs, gold and oil." 

Money from illicit activities accounted for 32 percent of the Venezuelan government's income, or about $14.4 billion in 2018, according to data from financial analysis Ecoanalítica compiled by the magazine Dinero. Gold smuggling generated about $2.71 billion, gasoline about $2.79 billion and drug trafficking about $2.65 billion, according to the Dinero report.

While there are no similar figures for 2019 and 2020, the Maduro government's finances have been hit hard by sanctions and a dramatic drop in oil prices, forcing it to depend even more on illicit streams, especially gold.

Saab was instrumental in negotiating deals with other countries in the face of choking sanctions. He helped to sell Venezuelan gold to countries such as Turkey and took part in negotiations with Iran to bring much-needed oil to Venezuela, according to Bloomberg.

SEE ALSO: Venezuela Relies on Gold as Other Criminal Economies Dry Up

Companies owned by or linked to Saab are present in a range of economic sectors, including agriculture, construction, oil, mining and food production. His firms have been targeted for laundering money obtained from the government's illicit control of Venezuela's exchange rates.  

With Saab's arrest, Maduro has lost a trusted member of his inner circle, just as he faces US drug trafficking charges and a bounty for his capture. 

Maduro even appears to have entrusted his personal wealth to the Colombian businessman. Should he be extradited to the United States, Saab would be invaluable to authorities in providing information about Maduro's alleged illicit businesses and links to criminal networks in Venezuela and abroad.  

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