A former executive with Swiss bank Julius Baer pleaded guilty on Wednesday for his role in a billion-dollar scheme to launder money embezzled from the Venezuelan state-owned oil company PDVSA, the US Justice Department said.
A Sliema-based private wealth management firm, Portmann Capital Management is being investigated for its role, allegedly helping to launder $1.2 billion in funds looted from Venezuela’s State fuel company.
The story hit the international headlines in recent weeks after a criminal complaint, filed in the courts of Miami last month, alleged that huge sums of money were syphoned from the oil company, Petroleos de Venezuela.
Matthias Krull, 44, a German national who is a former Julius Baer Panama vice chairman, pleaded guilty to one count of conspiracy to commit money laundering, the Justice Department said in a statement.
Krull admitted that in his position with the Swiss bank, he attracted private clients, particularly clients from Venezuela, to the bank. His clients included Francisco Convit Guruceaga, who was indicted on money laundering charges on August 16. Krull’s clients also included three unnamed conspirators.
The conspiracy began in December 2014 with a currency exchange scheme that was designed to embezzle around $600 million from PDVSA, obtained through bribery and fraud, and the conspirators’ efforts to launder a portion of the proceeds of that scheme.
By May 2015, the conspiracy had doubled in amount to $1.2 billion. Krull joined the conspiracy in or around 2016, he admitted, when a co-conspirator contacted him to launder the proceeds of a PDVSA foreign-exchange embezzlement scheme, the US Justice Department said.
Krull and members of the money laundering conspiracy used Miami, Florida real estate and sophisticated false-investment schemes to conceal that the $1.2 billion was in fact embezzled from PDVSA.
Krull also admitted that surrounding and supporting these false-investment laundering schemes are complicit money managers, brokerage firms, banks and real estate investment firms in the United States and elsewhere, operating as a network of professional money launderers.