‘A Series of Razors Waiting to Cut You’: The High Cost of Doing Business in Cuba 2

The Hotel Inglaterra in Havana, one of the hotels in which Starwood is investing. (Photo by Joe Raedle/Getty Images)

The Hotel Inglaterra in Havana, one of the hotels in which Starwood is investing. (Photo by Joe Raedle/Getty Images)

By Justin Rohrlich, Vice News

March 25, 2016 | 11:50 am

Sarkis Yacoubian swore he was just a businessman, but the state security agents holding him in a Havana interrogation room called him a spy.

It was July 2011, and Yacoubian, then 51, had been working in Cuba for nearly two decades. An Armenian-Canadian born in Beirut, he owned a trading company called Tri-Star Caribbean, which imported emergency vehicles, mining equipment, and auto parts for Cuba’s state-run industries.

About eight months before his arrest, Yacoubian says, a regime official visited Tri-Star’s Havana offices a handful of times — “Let’s call him ‘the Colonel,'” says Yacoubian, who claims not to recall the man’s name. The Colonel said that Cuba wanted to buy a fleet of BMWs, and asked Yacoubian to arrange it. The government’s wish list: sixteen 5-series sedans for the rental market and diplomatic use, and an armored X5 SUV for Cuban president Raul Castro’s personal motorcade. Yacoubian, knowing the contract could lead to many more, agreed to deliver the cars to Tecnotex, a state-owned conglomerate under the purview of the military run by Castro’s son-in-law, Colonel Luis Alberto Rodriguez.

The problems, however, started almost immediately. The government had previously been working with Eric Soulavy, a BMW dealer based in Venezuela who had run into financing problems. Yacoubian says a BMW rep got in touch with him and said that he needed to buy out Soulavy’s contract with BMW, which still had one year remaining. (A spokeswoman for the auto company said it does not comment “on the behavior of third parties as a matter of principle.”)

Yacoubian says he was at that point contractually obligated to deliver the vehicles to the Cubans, so with his “back to the wall,” he began negotiating with Soulavy. Yacoubian says they agreed to $800,000, with an initial transfer of $100,000. Soulavy, who is now a real-estate developer in Key Biscayne, Florida, says he doesn’t recall the exact amount he received from Yacoubian, but remembers charging him “something for the tools and parts we had invested in that business.”

Yacoubian says the buyers at Tecnotex were also asking him to take a $1,000 loss on each car, but “you don’t tell Raul Castro no.” Still, Yacoubian wasn’t doing the deal out of fear — he estimated the foothold the deal was gaining him could one day be worth up to $250 million.

Instead, he was accused of plotting to kill Castro.

Feature continues here: “A Series of Razors”

 

 

 

 

 

 

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Congressman Seeks Answers on Cuban Crime Rings 2

By Megan O’Matz and Sally Kestin, Sun-Sentinel

Cuban criminals are exploiting America’s generosity and must be brought to justice, a South Florida congressman told the new U.S. attorney general.

In a letter to Loretta Lynch, U.S. Rep. Ted Deutch said a U.S. law meant to help Cubans fleeing communism is instead being used by crooks “to evade arrest, avoid prosecution and deliver money stolen from American businesses and taxpayers back to Cuba.”

He cited a January Sun Sentinel investigation that found criminals taking advantage of the Cuban Adjustment Act to come to the U.S. and steal more than $2 billion over two decades.

The 1966 act gives Cubans extraordinary benefits unavailable to other immigrant groups: even Cubans arriving without permission can stay and become legal residents in just a year.

That makes it easier for the organized rings to rob Medicare, cheat credit card companies, and rip off auto insurers in schemes that can yield large sums with little risk of significant jail time, the newspaper found. Thieves and illicit money flow between Florida and its communist neighbor, aided by a law enacted as a gesture of good will a half century ago.

The law was adopted to help Cubans escape the Castro government, not “create a pipeline for sophisticated financial fraud,” Deutch wrote. “Yet crime rings in South Florida are using our humanitarian policy to successfully send cash and criminals back to the island without fear that the Cuban regime will extradite these fugitives.”

He urged the Justice Department to consider the issue in its negotiations with Cuba on reestablishing diplomatic relations. “Given the extent of the criminal activity described by the Sun Sentinel, I hope you agree that the issue of fugitives must be addressed during talks underway between the United States and Cuba.”

Deutch asked Lynch to update him “on this critical issue.” She took office in April, replacing Eric Holder, who resigned.

Diplomats from the U.S. and Cuba are scheduled to meet Thursday in Washington to continue discussions on establishing formal embassies in the two countries and creating greater avenues for cooperation. This historic move to restore diplomatic relations was announced by President Obama and Cuban leader Raul Castro five months ago.

Feature continues here:  Cuban Criminals

 

Venezuelan Officials Suspected of Turning Country into Global Cocaine Hub 3

Diosdado Cabello, president of Venezuela’s National Assembly, is a leading target of U.S. investigations into alleged drug trafficking and money laundering by senior officials in the South American nation, a Justice Department official said. Mr. Cabello has denied wrongdoing. Photo: Marco Bello/Reuters

Diosdado Cabello, president of Venezuela’s National Assembly, is a leading target of U.S. investigations into alleged drug trafficking and money laundering by senior officials in the South American nation, a Justice Department official said. Mr. Cabello has denied wrongdoing. Photo: Marco Bello/Reuters

U.S. probe targets No. 2 official Diosdado Cabello, several others, on suspicion of drug trafficking and money laundering

By José de Córdoba and Juan Forero, Wall Street Journal

May 18, 2015

U.S. prosecutors are investigating several high-ranking Venezuelan officials, including the president of the country’s congress, on suspicion that they have turned the country into a global hub for cocaine trafficking and money laundering, according to more than a dozen people familiar with the probes.

An elite unit of the Drug Enforcement Administration in Washington and federal prosecutors in New York and Miami are building cases using evidence provided by former cocaine traffickers, informants who were once close to top Venezuelan officials and defectors from the Venezuelan military, these people say.

A leading target, according to a Justice Department official and other American authorities, is National Assembly President Diosdado Cabello, considered the country’s second most-powerful man.

“There is extensive evidence to justify that he is one of the heads, if not the head, of the cartel,” said the Justice Department official, speaking of a group of military officers and top officials suspected of being involved in the drug trade. “He certainly is a main target.”

Representatives of Mr. Cabello and other officials didn’t return phone calls and emails requesting comment. In the past, Venezuelan authorities have rejected allegations of high-ranking involvement in the drug trade as an attempt by the U.S. to destabilize the leftist government in Caracas.

In an appearance on state television Wednesday, Mr. Cabello said he solicited a court-ordered travel ban on 22 executives and journalists from three Venezuelan news outlets that he has sued for publishing stories about the drug allegations earlier this year. “They accuse me of being a drug trafficker without a single piece of evidence and now I’m the bad guy,” Mr. Cabello said. “I feel offended, and none of them even said they’re sorry.”

Feature continues here:  Venezuelan Drug Trafficking

 

 

 

 

US Sanctions Disrupt Venezuelan Money-Launderers Reply

BPAThe U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) yesterday named Banca Privada d’Andorra (BPA) as a foreign “money laundering concern.”  FinCEN’s notice also said a senior BPA manager accepted exorbitant commissions to process transactions related to Venezuelan third–party money launderers. “This activity involved the development of shell companies and complex financial products to siphon off funds from Venezuela’s public oil company Petroleos de Venezuela (PDVSA). BPA processed approximately $2 billion in transactions related to this money laundering scheme,” reported FinCEN. Reuters subsequently reported that the government of Andorra has taken control of BPA.

 

 

 

Caracas Holds World’s Airlines as Financial Hostages Reply

Caracas Withholds 4B in Debt Owed to Airlines

Alitalia joins other airlines suspending or reducing flights to Venezuela

By Rafael Romo, Senior Latin American Affairs Editor

(CNN) — First, Air Canada decided to suspend all of its flights to Venezuela in late March. And now, Alitalia is following suit.

In a statement sent to CNN, the Italian airline says that it’s suspending the flights “due to the ongoing critical currency situation in Venezuela,” which is “no longer economically sustainable.

The suspension goes into effect on June 2.

For the last 11 years, Venezuela has tightly controlled all cash flow within its borders. Under the Venezuelan system, all money collected in ticket sales has to be deposited into an account controlled by the government. No funds can be withdrawn from the account without permission from the officials who control it.

The government sets exchange rates for different sectors of the economy, according to priorities also set by officials.

“The bottom line is the airlines are asking for their money; the money that they’ve earned for services provided in transporting passengers from and to Venezuela. Unfortunately, again, the government is holding that money and not releasing it to the airlines,” said Peter Cerda, regional vice president for the International Air Transport Association, which represents airlines around the world.

He calls the situation “an urgent issue.”

In an interview with CNN, Cerda said Alitalia is not the only airline facing problems. In fact, he says, Venezuela owes 24 airlines around the world a combined $4 billion.

Feature continues here:  Caracas Holding Airlines as Financial Hostages

Cuban Comrade Now a House-Flipping Capitalist Savant 1

High-level defector Pedro Alvarez Borrego has become a house flipper extraordinaire. Some question the source of his stake money.

By Juan O. Tamayo, JTamayo@elNuevoHerald.com

TAMPA — Pedro Alvarez Borrego, a top Cuban government official who oversaw the nation’s $1.5 billion-a-year food-importing enterprise, is living the American Dream in Tampa a mere two years after he defected. Alvarez has bought and sold at least eight homes worth a total value of nearly $600,000 and opened a management company, official records show. He has also reportedly become a consultant on how U.S. businesses can enter the Cuba markets. Yet mystery lingers over exactly how the 70-year-old could buy so much real estate so soon after his arrival from Cuba, where he was under criminal investigation in a kickback-for-imports scandal at Alimport, the state monopoly for food imports.

Before his hasty defection, his job at Alimport made him the powerful main negotiator of contracts with chomping-at-the-bit U.S. exporters that hit a record of $711 million in 2008 and turned the United States into Cuba’s fifth-largest trade partner. Today, Alvarez, one of the top Cuban defectors in recent memory, is trying to keep out of the public eye and enjoy the good life — a neighbor said he drives a red H3 Humvee — even as some anti-Castro activists in Tampa complain that he may be living off corrupt money. The man who answered an El Nuevo Herald call to the telephone number Alvarez has given in official U.S. documents said he was a different Pedro Alvarez. “I am just a simple carpenter. Do you have any jobs for me?” he said before he laughed and hung up.

An economist, Alvarez was named to head Alimport in 1998 and was perfectly positioned in 2000 when the U.S. Congress authorized the cash-only sale of agricultural products to Cuba under the Trade Sanctions Reform and Export Enhancement Act. Cuba was suddenly awash in U.S. visitors looking for sales contracts — including several dozen Congress members, six governors and a who’s who of the leading agriculture companies known as Big Ag. “He single-handedly said yes and no to billions in sales,” said John Park Wright IV, a Naples, Fla., businessman who signed several cattle deals with Alimport. Cuba’s global food imports hit $1.6 billion in 2011, according to official Havana figures. And in 2003, Alvarez masterminded the controversial scheme under which Alimport pressured U.S. politicians and exporters to sign written pledges that they would lobby the Congress to ease economic sanctions on the island. The pledge might have technically made them agents of the Cuban government, though no one was prosecuted.

Read more here: http://www.miamiherald.com/2013/01/26/v-fullstory/3202566/cuban-comrade-now-a-house-flipping.html#storylink=cpy