Venezuelan Businessman Convicted in Miami in “Suitcase Scandal”

On Monday, a Miami jury found Franklin Durán, the co-owner of the private Venezuelan motor oil manufacturer VENECO, guilty of acting as an unregistered agent of the Venezuelan government in the United States.
At Left, Guido Antonini, with business partner Franklin Duran, at a race track before their friendship fell apart.

Mérida, November 5, 2008 (– On Monday, a Miami jury found Franklin Durán, the co-owner of the private Venezuelan motor oil manufacturer VENECO, guilty of acting as an unregistered agent of the Venezuelan government in the United States.

The jury deliberated for seven days, and at one point had told the judge it was deadlocked.

Durán’s lawyer, Edward Shohat, told reporters Monday that the trial has been “a political circus” and that he plans to appeal the verdict because the FBI had entrapped his client. Durán faces up to 15 years in prison.

Assistant U.S. Attorney Thomas Mulvihill said the verdict shows that “the United States takes very seriously the actions of any foreign agents on its soil; that is what this case was about.”

According to the jury’s decision, Durán conspired to conceal the origin and destination of what the prosecution said was an $800,000 campaign contribution from the Venezuelan government to then Argentine presidential candidate Cristina Fernández de Kirchner.

This occurred when Durán and three other businessmen came to Miami in December 2007 to give advice to their business partner Guido Antonini, who had been caught with the money in a Buenos Aires airport four months prior.

Antonini, strapped with an FBI wire he had agreed to wear during his conversations with Durán and the other defendants, faced no charges in the U.S. and served as a star prosecution witness.

All four defendants originally pleaded not guilty. Then, U.S. federal prosecutors delayed the trial for several weeks while they used threats and bribes to convince three of the defendants to accept plea bargains. Two of them, including Durán’s co-owner of VENECO, Carlos Kauffman, testified against Durán, who maintained his not-guilty plea.

Shohat and Durán denounced early on that the trial was really a political attack by the U.S. government, through the Department of Justice, to slap a corruption label on its ideological foes, the progressive Kirchner administration, and the “socialist” administration of Venezuelan President Hugo Chávez.   

Shohat also initially motioned to dismiss the charges against Durán, arguing that the law which Durán was charged with breaking is unconstitutional because its vagueness about what type of behavior is illegal opens the door to political persecution.

The law, 18 U.S.C. § 951, was used throughout the Twentieth Century to prosecute spies from enemy nations during wartime. This time, U.S. federal prosecutors used the law to bring a relatively unthreatening South American corruption ordeal into U.S. courts and mainstream press.

Antonini and Kauffman testified that the money he was caught with came from the Venezuelan state oil company, PDVSA, and was headed for Kirchner’s presidential campaign, and that Chávez had directed a high level cover-up.

In statements recorded by the bugged Antonini in Miami, Durán and the other defendants said that Chávez and Kirchner would protect Antonini if he appeared in court in Argentina. Later, Durán testified that these were lies to convince Antonini to go to court in Argentina.

Then, it was revealed that the FBI paid Antonini $30,000, that it was the author of a letter from Antonini to Chávez soliciting a $2 million bribe to keep quiet about the origin and destination of the cash-filled suitcase, and that the FBI offered a bribe to the Argentine customs officer to change her testimony in favor of the prosecution.

Meanwhile, the prosecution provided little evidence that the presence of Durán in Miami and the scandal he was allegedly covering up posed a national security threat to the U.S.

In a controversial move late in the trial, the judge permitted a series of testimonies about Durán’s previous backroom deals and kickbacks paid to PDVSA officials in exchange for oil contracts. The defense said this evidence was aimed at politically embarrassing Venezuela and was unrelated to U.S. national security.

Both President Chávez and President Kirchner have denied involvement in the case, denounced that that the trial is yet another political retaliation against them for not falling into line with U.S. interests, and advocated that a separate trial be held in Argentina.

Pedro Carmona, who named himself President during the two-day coup against Chavez in April 2002, was the co-owner of VENECO before Durán acquired the company four years ago. Last weekend, President Chávez said he will consider nationalizing VENECO because its owners have consistently plotted against the Venezuelan government, most recently, he said, by colluding with the FBI in what is now known as “suitcasegate.”
Durán’s conviction comes amidst an intensifying U.S. government campaign to criminalize the Venezuelan government. Last March, the U.S. and its ally Colombia accused the Chávez administration of financing leftist Colombian guerrillas, citing computer evidence that was never confirmed as authentic. In September, the U.S. kept Venezuela on its list of non-collaborators in the war on drugs, and said that Venezuela’s arms purchases from Russia are reminiscent of the Cold War.

Also Monday, Antonini announced that he will go to court in Argentina.