Derwick Associates: Exhibit X of Venezuela's Corrupt Criminals

London 03/10/2012 | There was a time, when Venezuelan thugs caught in the act used to recourse to a form of intimidation that had no legs to stand on: paid advertisement in regime-aligned media. I remember with particular fondness, how a couple of such small time crooks from one 'North American Opinion Research' pollster, Julio Makarem and Ricardo Valbuena, decided that the best way of dealing with publication of their dubious track record was to appeal to Hugo Chavez and his regime's authorities to open an investigation about me and other bloggers, who had either contributed to investigations about their dodgy affairs or had echoed our findings. Needless to say that, most unfortunately for Makarem and Valbuena, no investigation was launched and their reputations were laid to waste forevermore.

But time has brought changes in the methods used by old and new criminals alike in Venezuela. Perhaps readers will remember how impersonators, acting on behalf of Majed Khalil Majzoub, started harassing and sending me legal threats so that I would remove perfectly valid information about corruption  rackets in which Khalil Majzoub was involved in Venezuela. Since my reaction was not what Khalil Majzoub had in mind, his online reputation management people got in touch with Blogger.com to argue that my posts exposing their illegal activities had violated copyrights. After a little while, Blogger saw the sense of my counter arguments -after all I very much doubt that Google is in the business of protecting the reputation of criminals- and reinstated the posts in question (see here, and here).

Right before Blogger had "ruled" in my favour, my hosting company sent the following message:

Please be advised that there is an ongoing Distributed Denial of Service (DDOS) attack on your website, vcrisis.com.

Since this attack was affecting the entire shared server, we have implemented a block on the firewall to block all access to vcrisis.com's website only. Your mail and other services should still be functional.

We are keeping an eye on the DDOS attack and will release the firewall block once it ceases.

If you are aware of the source of the attack or reason, please let us know of any information.

This was the first time, since I started blogging in vcrisis.com in October 2002, that such an attack had taken place. I had received all kinds of threats, but never had my site suffered a DDOS attack. The attack lasted about a week. In my own investigations, I have been able to determine that money, erm millions of public funds stolen from Venezuela, can buy hackers' services, among which botnets to launch massive DDOS attacks.

While my personal story with Majed Khalil Majzoub was ongoing, similar attempts were taken place elsewhere. I had noticed that those working to clean Khalil Majzoub reputation online had registered hundreds of sites, which effectively move results down Google rank, and so exposes are nowhere to be seen in the first page when somebody runs a search on his name. That's fine, legal, and many people use it. Given the open source nature of information published, the legal threats I received did not achieve anything. However reading other sites, I learned that other Boliburgueses -as the utterly corrupt  chavista 'businessmen' class that has become phenomenally wealthy in the last few years is known- were also in it. David Osio and Moris Beracha -both linked to Pancho Illaramendi's $550 million fraud of PDVSA's workers funds- have been registering hundreds of websites to erase connections to articles that expose them as crooks. In the comment section of the article linked previously, FTI Consulting is mentioned as the company that is 'cleaning' these thugs images online.

Alejandro Betancourt Lopez

Cue in Leopoldo Alejandro Betancourt Lopez, aka Alejandro Betancourt Lopez. This fellow is meant to be director of a company called Derwick Associates. Venezuelan journalist Cesar Batiz did a thorough investigation on Betancourt and his Derwick Associates joint, and exposed overcharging -in the hundreds of millions of dollars- of power plants sold to various public institutions to solve electrical blackouts. Batiz provided names of directors, registered addresses -in Panama, Barbados, USA, Spain and Venezuela, suspect connections, but more importantly, he put names to the new class of criminals looting Venezuelan public coffers, Boliburgueses 2.0 or Bolichicos as they are now known. None of them is older than 30, and yet, they have amassed fortunes running in the billions of dollars in the last 3 or 4 years. Betancourt Lopez is now the proud owner, for instance, of a €24 million, 1,600-hectares country pile in Spain, where he also got married in a lavish wedding with matadors and everything (this seems to be a running theme among parvenu Venezuelan white collar crooks, that of marrying into Spanish jet set to launder their ill gotten wealth...)

According to Batiz, despite lacking a track record, anywhere, Derwick Associates managed to get, in total, 12 public contracts in 14 months. The first contract with Bariven (PDVSA subsidiary) was in 2009, only 12 days after Hugo Chavez announced a national emergency due to power failures. That one netted Derwick Associates a cool $209 million. More was to come, given the 'emergency'. According to another website, wikianticorrupcion.org, Derwick Associates ended up pocketing $1.2 billion out of $3 billion in contracts total. Batiz mentioned Picure, La Raisa I, Guarenas I, Dual Tacoa, Guarenas II, La Raisa II, CVG-Sidor, Las Morochas, Furrial, Morichal, Barinas, and Bare as the projects for which Derwick was contracted. All of the projects to generate power are, of course, incomplete, though the money is already safely stashed away in Lebanon's Gazprom Bank, JP Morgan and Julius Baer. Betancourt Lopez's partners in crime are identified as: Pedro Trebbau Lopez, Iker Candina, Gonzalo X. Guzman Lopez, Edgar Romero Lazo, Silvia Clarke and Luis A. Davis.

Betancourt Lopez is a young turk. It follows that he's well aware of reputation management techniques. But what surprises me is that, unlike others of his ilk, he has actually sued somebody in relation to investigations into his illegal affairs published thus far. Cesar Batiz seems to have been the pioneering investigator in this saga, but Betancourt Lopez and his associate thugs at Derwick have issued legal proceedings against Oscar Garcia Mendoza, owner of Venezuela's most solid bank, Banco Venezolano de Credito (BVC), for allegedly financing the site wikianticorrupcion.org, and, get this, "for the intentional, unlawful and malicious purpose of attempting to injure and destroy [Derwick Associates'] personal, professional and business reputations." What reputation might that be? Since when crooks had reputations to be concerned about in international circles? Perhaps since they are desperately trying to erase their past.

The Bolichicos at Derwick are demanding $300 million in damages. I've also heard that Derwick Associates has been threatening fellow bloggers, after publication of its misdeeds. The whole thing is, of course, laughable, for Betancourt Lopez and the activities of his Derwick Associates can only stand scrutiny in Hugo Chavez kangaroo courts. The minute independent prosecutors in the USA start investigating how Derwick Associates came about its sudden fortune, much explanations will have to be forthcoming. Money laundering and corruption are, after all, crimes in most jurisdictions, and when questions about the allegations published by Batiz and wikianticorrupcion.org start being bandied in court it will be extremely interesting to hear what Betancourt and his mates have to say. It actually reminds me of another episode of cocky Venezuelan thugs (Smartmatic boys) boasting about their disposition to submit to a CFIUS probe, only to realise that it wasn't in their best interest and ended up fleeing.

Derwick Associates is a fine example of a cast of criminal enterprises that have flourished under Hugo Chavez's galloping and irresponsible waste. From Ricardo Fernandez Barrueco, to Wilmer Ruperti, to the Smartmatic boys, the Khalil brothers, to 'bankers' David Osio and Moris Beracha, to drug dealer Walid Makled -who had Venezuelan top generals and chavista politicians on his payroll, all share the same characteristics: an amoral and plundering nature that has cost Venezuela billions of dollars in the last 14 years.