Luis Díaz Jr. (age 74) and his son, also named Luis Díaz (49), were arrested in Miami yesterday. Díaz and Díaz, who ran the ever-so-legit-looking Miami Equipment & Export Company, will face an indictment by crusading U.S. Attorney Preet Bharara on charges of laundering nearly $100 million on behalf of Venezuelan construction companies and regime officials.

What’s that you say? You have no idea who Luis Díaz is? Neither do we!

De pana, we have no clue what this is about, and since the indictments don’t name the counterparts in Venezuela (either public or private) we have no quick way to find out.

How many guys are out there guisando in the $10-100 million range, being smart about it, that you and I will never hear about?

But that’s almost expected…to get noticed as a corrupt operator in Venezuela, you have to be either exceptionally crass, exceptionally flashy, or deal with exceptionally large amounts of money. If you’re reasonably smart, reasonably discrete and you’re dealing with corruption in the (by Venezuelan standards) modest tens-of-millions of dollars range, it’s insanely easy to go unnoticed…by the press, if not by Preet Bharara.

The real question for me is, how many Luis Díaz’s are there out there? How many guys are out there guisando in the $10-100 million range, being smart about it, and going unnoticed? Dozens? Hundreds? How many?

In a way, I almost feel for the bolichicos. Through sheer stupidity/love-of-publicity, they’ve ended up soaking up all the freefloating anger out there: the share owed them, yes, but also all the extra free-floating pissed-offedness we share at the unidentifiable, invisible Luis Diazes out there. It really isn’t fair.

25 COMMENTS

  1. IDK, Francisco

    A lot of people hate the bolichicos thanks to people like César Batiz and Alek Boyd. But I woudn’t say they are the best known corruptos in Venezuela. Besides, it is very unlikely anything will happen to them as long as Ramos Allup has any influence in the AN.

    • it’s a question of proportionality…what proportion of anger-over-corruption do the bolichicos soak up? what proportion do the Diazes soak up? For a comparable-sized crime, the bolichicos are vilified, the Diazes ignored.

  2. Just had a look through their webpage. They have almost no inventory of construction equipment or cranes for sale….almost nothing. So it would be very easy to be suspicious of an extra $100 million being routed through their company, unless of course the cranes they sold to Venezuela were gold plated.

  3. These were charging commissions for letting the money go through their account. The ones really under the radar are the “cadiveros”. Tons of them.

  4. I am fairly certain that:

    1. There are hundreds of them… at least!

    2. They are actually pretty easy to identify and catch with any minimal degree of investigative competence, because…

    3. They don’t even believe that what they are doing is “wrong” in any moral sense.

    4. They believe that all the “commissions” they collect are truly earned.

    5. Their efforts to avoid being caught are only “pro forma”, designed to create only the most minimal appearance of legitimacy.

  5. There are four ways how govt graft operates :
    1. the govt official and the private company are in cahoots from the very beginning , each seeking the other out.
    2. the private company seeks to bribe an otherwise honest official and ends up by bribing him to do their bidding.
    3. the official extorts the private company to give it a bribe or their totally out of the game ….!! the private company succumbs to the coercion.
    4. The payment of graft is just a normal customary part of any transaction and both the official and the private company see it as part of ordinary business operations.

    Where graft takes the form of mode you must punish both the official and the company.

    Where the graft takes the form of mode 2 you must punish the company more severely than the official .

    Where the graft takes the form of mode 3 , you must punish the official

    Where the graft takes the form of mode 4 , you must totally change the culture of the organizations and the contracting practices , additionally to punishing all perpetrators .

    In Brazil case we are confronting mode 4 , In Venezuela in the past we had a mix of modes 1 to 3 , but now after 16 years of populist proto communist rule we are firmly in mode 4 ……graft is just part of the system of doing business with the govt…..!!

  6. If they are operating how of US banks, they will be sure to be caught. I know of a few Venezuela operators with US bank accounts for truly legitimate purposes and they are routinely audited, even for small transactions (like less than $5k). Good luck to those who have not kept it clean – should continue to be entertaining!

      • Part of the rules for operating a bank in the US is that any transaction over $10,000 generates a currency transaction report which is then floated on to the IRS. This is part of US anti-money laundering regulations for the last 30 years. 20 years ago, banks were also required to run SARs, or suspicious activity reports, which documented consistent transactions under the $10000 threshold or a customer refusing to continue a transaction after finding out about the CTR. That’s been around for about 20 years.

        The real shift in the game has been the last 5-10 years, where more information is collated and through the use of algorithms, they are able to compile a “normal” pattern of transactions for accounts. So running several small transactions that exceed the $10,000 threshold in a business that has minimal assets/or odd patterns of activity are now much more likely to generate a SAR.

        That’s why cases in money laundering, particularly involving overseas companies/individuals have become much easier to verify/prosecute and much, much more common. Thus the popularity of offshore accounts such as we saw in Panama.

        The hard part is when the money is again onshored; it stll generates a CTR/SAR more often than not and then the IRS becomes quite interested. The problem they have now is not so much going after people; its having sufficient resources to nail them all given how much is required for an investigation.

  7. Has this story been reported?

    CARACAS – A Delaware Uniform Commercial Code (UCC) filing against Citgo parent PDV Holding, Inc. on November 30 reveals that Venezuela has secretly mortgaged their Citgo refineries in the United States to Russia’s Rosneft in exchange for cash.

    Steven Bodzin, one of the leading investigative reporters on Latin America who uncovered the filing and broke the story for REDD Intelligence, reports that cash-strapped PDVSA may have mortgaged up to 49.9% of Citgo to Rosneft for a $1.5 billion loan.

    http://laht.com/article.asp?ArticleId=2427676&CategoryId=10717

  8. Quico, the answer is a lot. The feds know who many are and where they like to meet….in a Venezuelan-Italian restaurant in Doral. Many walk away after capture like my old friend Salomon Bendayan…..

    Talk to me about Rosneft.

  9. Excellent note by Toro. The names of the Venezuelans on the other side of this crime will be eventually be known. Please, do not show sympathy, even if it is an irony, for the bolichicos. We have to catch both tuna and sardines. The Diaz were apparently working for a big fish, although they themselves are sardines and only received a minor cut of the crime money.

  10. ¿Sabes por qué se cayeron, Mr. Toro?

    Porque eran, unos MARGINALES, con un RANCHO EN LA CABEZA.

    Cuando se tiene “el rancho en la cabeza”, se tiene la urgencia patológica de restregarle la plata malhabida a los demás y eso se llama ser MARGINAL.

  11. It’s hard to hate what you don’t know, I doubt many venezuelans have any clue about the insane scale of bolivarian dollar corruption, the obscene media silence and hegemon desinformation have generated that people simply don’t care, don’t believe, or think they’re rumours.

  12. I fear that paying bribes has become systemic not only where transactions with govt entities is concerned but also for transactions between large private purchasers and their suppliers , the purchasing officer in the purchasing company will ask for a quote , seek to have a private conversation with the supplier making the quote, ask the latter to raise the quote so that part of its amount is channeled to the bank accounts of proxies for the purchasing officer and his/her boss ……..the supplier has no choice but to consent to the overpriced transactions as the only way of simply staying in business.

    Have some acquaintances in industry and they tell me this has now become standard practice with many large private companies , including some foreign private companies …….the practice of corruption is pervasive and endemic both in govt transactions and in private commercial transactions ….!!

  13. The website was set up without running through a spelling corrector ? ” Los propretarios y empleados de la empreza …” 2 spelling mistakes in 7 words ? Let me help: propretarios should be propietarios and empreza should be empresa …

    • “Very difficult not to get nervous. A firned of mine who went to the show and got to question 5 or 6, told me that the first hurdle is the layout of the buttons that yoy pres to answer, it is not the same as shown in TV, for example in TV they are stacked horizontally, and in the show they are vertical, maybe Jose Gonzalez can comment ?”
      Sound familiar Moses?
      Hey dude, may he who is without sin cast the first stone. Thats a “friend” of mine “that you press” Your spelling is atrocious as well by the way.

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