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VENEZUELA

Álex Saab

VENEZUELA PERSONALITIES / LATEST UPDATE OCTOBER 18, 2021 EN

Álex Nain Saab Morán is a Colombian businessman and suspected international money launderer who is a close ally of Venezuelan President Nicolás Maduro, and who authorities say designed multi-million dollar schemes involving Venezuelan government officials. 

On October 18, 2021, Saab was sent to the United States to face charges of money laundering. Saab was extradited from the Cabo Verde after his arrest in June 2020, when his private jet landed in the West African nation to refuel.

Saab is accused of being part of a corruption scheme that included kickbacks to Venezuelan government officials. According to the US Justice Department, Saab and his partner funneled more than $350 million to overseas accounts.

Maduro has long protested US prosecutors' actions against Saab, claiming he has diplomatic immunity and was on a humanitarian mission to Iran when he was arrested. It has been speculated that Saab may hold key financial secrets of the president and other top officials.

History

Álex Saab is the son of a Lebanese immigrant who settled in the city of Barranquilla and opened various businesses, finding success in Colombia’s textile industry.

The second of four brothers, Saab sold promotional keychains and uniforms for businesses when he met Álvaro Pulido, a Colombian businessman linked to the former Colombian senator Piedad Córdoba. Pulido then invited Saab to be his business partner in various deals in Venezuela. 

Between 2004 and 2011, the two men exported merchandise to Australia, Ecuador and Venezuela through a company called Shantex S.A. In Venezuela, their clients were small, relatively unknown businesses that had access to dollars at a preferential exchange rate thanks to the country’s former currency control agency’s (Comisión de Administración de Divisas -- CADIVI) official exchange system.

During that time, 82 percent of the company’s income came from Venezuela, according to an accounting report.

Many of these transactions were never reported in Colombia, which is why authorities suspect the laundering of corrupt business proceeds

The close relationship between Saab and Chavismo dates back to 2011, when an agreement to supply the parts needed to build prefabricated houses for Venezuela’s Housing Mission was signed in front of then-president Hugo Chávez, Chancellor Nicolás Maduro, and former Colombian president Juan Manuel Santos.

The agreement was made with the company Fondo Global de Construcción, through which Saab and Pulido gained access to preferential exchange rates in Venezuela and to the Unified System for Regional Compensation (Sistema Unitario de Compensación Regional de Pagos -- Sucre), which Colombia and Ecuador advocated for.

Between 2012 and 2013, the company received approximately $159 million to import housing kits into Venezuela. However, the company only delivered $3 million worth of products. Ecuador investigated the exports, suspecting money laundering, fictitious operations, and overbilling by Fondo Global de Construcción’s affiliate in Ecuador. The investigation into the business structure led to the known tax haven of Malta in the Mediterranean Sea. The case, however, was eventually dismissed.  

Saab and Pulido started to participate in contracts in the food industry in 2015, when a newly created business partnership in Panama called Global Foods Trading signed at least four contracts worth around $125 million to supply corn, wheat, rice and soy to Venezuela. Journalists were able to link Global Foods Trading to Saab.

In 2015, Saab also wanted to partake in the state-run oil company, Petróleos de Venezuela S.A. (PdVSA), through a company called Trading Energy and Coal (Trenaco), which was based in Switzerland but managed from Colombia. Despite its lack of capital and subject area experience, the company won a contract valued at $4.5 billion. However, the contract collapsed months later. 

At the end of 2016, Saab signed one of his first contracts to provide 10 million food box combos for the Local Supply and Production Committees (Comités Locales de Abastecimiento y Producción -- CLAP) with the Táchira state government. The contract, valued at more than $200 million, was granted to Group Grand Limited, a business registered in Hong Kong in 2013 and then later in Mexico. A similar contract worth some $113 million followed in 2017, this time with Venezuela’s Corporation of Foreign Trade (Corporación Venezolana de Comercio Exterior -- Corpovex), to supply 11 million food boxes.

Although Saab seems to have maintained a low profile at first, the contractor’s name started to gain notoriety in August 2017, when then-Venezuela Attorney General Luisa Ortega Díaz named him as one of the men behind Group Grand Limited, along with Colombian businessmen Álvaro Pulido and Rodolfo Reyes. Attorney General Díaz indicated that the company really belonged to President Maduro.

With investigations into exports suspected of corruption and other irregularities open in Colombia and Mexico, the Colombian businessman decided in April 2018 to move his companies to Turkey. He asked state agencies to change previous contracts to the new structure, Mulberry Proje Yatirim A.S. As part of this framework, they joined several other companies registered in the United Arab Emirates as intermediaries in the CLAP business. This occurred around the same time that the Maduro administration established a relationship with Turkey President Recep Tayyip Erdogan, with the purpose of refining gold extracted from the Orinoco Mining Arc, as well as for food conventions. 

A few months later, President Maduro made official the creation of a mixed business between the state-owned Compañía General de Minería de Venezuela (CVG Minerven) and a company known as Marylins Proje Yatirim, which is registered in Turkey. An investigation by the webpage Armando.Info linked the company in Turkey to Mulberry, another one of Saab’s businesses. This serves as proof of Colombia's involvement in the Venezuelan gold business.

Another publication also linked Saab to the sale of more than seven tons of Venezuelan gold, which was taken to Uganda from the Venezuelan Central Bank reserves.

In June 2020, Saab was arrested after his plane landed in Cabo Verde. US intelligence operatives had reportedly been tracking Saab's movements by plane through several countries and jumped at the chance of having him detained. The United States quickly filed an extradition request which was granted by Cabo Verde's Constitutional Court in September 2021.

Criminal Activities

Álex Saab has been accused of numerous crimes, including money laundering, conspiracy, illicit enrichment, and fictitious exports and imports, among others. Some journalistic reports also point to possible links to drug trafficking.

As businessmen, Saab and Pulido knit together a network of shady shell companies registered mainly in tax havens under third-party names, such as the names of their sons, siblings and allies. Under the guise of these companies, Saab has allegedly undertaken fictitious exports and corrupt activities that have left him with hundreds of millions of dollars in profits. 

His commercial and financial movements have made him a target of investigations in at least nine countries. In Mexico, Saab is being investigated for irregularities in his food exports to Venezuela. In Ecuador, he’s under investigation for irregularities in his prefabricated house exports.

The United States and Israel are also investigating him for a series of transactions that led to the Middle Eastern country and a suspected nexus with the terrorist group Hezbollah, which is thought to have established relations with Venezuela through Tareck El Aissami, the Minister of Industries and National Production.

Journalistic investigations have noted price inflation in the invoices from Saab’s contracts to provide food to the CLAP system, as well as the poor quality and low nutritional values of the acquired products. 

Saab’s recent foray into Venezuelan gold potentially demonstrates another side of his criminal portfolio. The participation of Venezuelan criminal groups, corrupt security officials, and Colombian guerrillas like the National Liberation Army (Ejército Nacional de Liberación — ELN) has been reported in gold extraction. Additionally, the US Treasury Department sanctioned the commercialization of gold from Venezuela. 

Saab was arrested in Cabo Verde on charges of running a global multi-million dollar money laundering operation that diverted state funds to overseas accounts.

Geography

Álex Saab and his business partners’ main operations have been focused in Venezuela, where they have the support of the Maduro administration.

For this, Saab has set up businesses in Bahrain, Brazil, China, Ecuador, Hong Kong, India, North Korea, Panama, Pakistan, Taiwan, United States, United Arab Emirates and Turkey, several of which are shell companies. Colombian authorities confirmed that the money received for business deals with Venezuela could be traced back to banks in the United States, Panama, India and Israel. 

Meanwhile, he has used countries in the region like Colombia, Ecuador, Mexico and Panama as operational centers for his companies. 

Allies and Enemies

Álex Saab managed to establish relationships with key people in Colombia that helped him to access the highest levels of Maduro’s government. One of the main connections has been the former Colombian senator Piedad Córdoba, who in various interviews has commented about her relationship with the businessman from Barranquilla. 

Since 2011, when Saab officially became a government contractor, he strengthened his ties with government officials, who then later became his partners and allies. 

One example is Adrián Perdomo Mata, who, in August 2018, was named as president of Minerven, the company in charge of Venezuelan gold extraction, which Saab is truly behind. Perdomo participated in the Fondo Global de Construcción and Trenaco, but legally absolved these partnerships before being named to a new role. 

Prospects

The fact that Maduro would pay hundreds of millions of dollars to Saab in the middle of the most serious economic crisis seen in the region, in which Venezuela continues to be in debt with pharmaceutical, food, and aeronautical companies, indicates that the relationship they maintain is more than commercial. 

In addition to Ortega Díaz’s accusation that Saab is a frontman for Maduro, it’s not difficult to understand the tangled series of companies and measures that he has taken in order to continue working with the Venezuelan government, to the point of receiving payments in gold for the sale of food boxes. 

Saab's extradition to the United States on charges of money laundering puts him tight position. He may hold key information of Venezuela's financial secrets, giving him leverage with prosecutors in a possible plea agreement. But the Maduro regime has made it clear that there will be a price to pay if he divulges that information.

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