Colombian close to Venezuela’s leader detained before money-laundering trial in Miami

Alex Saab, a Colombian businessman close to Venezuela’s president, appeared in Miami federal court Monday after a long extradition fight on charges of siphoning $350 million from the Venezuelan government by bribing officials to secure building contracts for low-income housing in the economically depressed country.

Saab, 49, was ordered detained for now by a federal magistrate judge but he can seek his release at a later date. Federal prosecutors told Magistrate Judge John J. O’Sullivan that they will ask that he be detained before his money laundering trial because they consider him a flight risk. Prosecutors noted that Saab fought his extradition from Cape Verde to Miami, where he was brought Saturday, for more than 400 days.

Saab, who is represented by Miami defense attorney Henry Bell, is scheduled for arraignment on Nov. 1.

Saab was carrying a Venezuelan passport when he was arrested last year in Cape Verde off the coast of Africa en route to Iran on what he called a humanitarian and medical mission. He claimed to be a Venezuelan diplomat who was immune from prosecution as he fought his extradition before the Cape Verde court, but to no avail.

While being held in Cape Verde, he also tried to get his money laundering indictment dismissed in Miami, claiming immunity. After losing, he appealed in a matter that is still pending before the 11th U.S. Circuit Court of Appeals in Atlanta.

Now in custody at the Federal Detention Center in Miami, Saab could face a long prison sentence if he is convicted of a money-laundering conspiracy charge and related offenses under the Foreign Corrupt Practices Act.

Saab, who is close to Venezuelan President Nicolás Maduro, is the latest suspect to be charged in connection with a series of corruption and money-laundering cases filed in the United States that accuse dozens of current and former Venezuelan officials, business people and lawyers of stealing billions of dollars from Venezuela’s government and its state-run oil company, PDVSA.

Saab was charged along with Colombian national Alvaro Pulido Vargas, 55, a fugitive. They are accused of paying off Venezuelan government officials to obtain contracts to supply building materials for low-income housing projects between November 2011 and September 2015, according to an indictment filed by federal prosecutors Kurt Lunkenheimer and Alex Kramer.

Saab and Pulido paid bribes “to obtain improper business advantages” from Venezuelan government officials, the indictment said. In turn, the two men were paid in U.S. dollars from the Venezuelan government’s foreign-currency exchange system “based on false and fraudulent invoices and documents for goods that were never imported into Venezuela,” the indictment said.

Saab and Pulido are accused of conspiring with others to launder the proceeds of the illegal bribery scheme from Venezuelan bank accounts into the U.S. financial system, including South Florida, where co-conspirators held meetings to carry out the illicit plot, U.S. prosecutors said. Prosecutors are seeking to confiscate $350 million of Saab’s assets, and have already seized about $12 million from his U.S. bank accounts.

While Saab boasts a high profile in South America, he also struck up a discreet relationship with a University of Miami professor who was implicated in an unrelated money-laundering case in South Florida.

Former UM professor Bruce Bagley pleaded guilty last year to two counts of money laundering stemming from helping Saab divert $2.5 million in illicit funds from a food company controlled by the Colombian businessman between 2017 and 2018. His sentencing has been postponed repeatedly during the COVID-19 pandemic and is now scheduled for mid-November.

Bagley, who is considered an expert on Latin American crime and money laundering, deposited Saab’s overseas transfers in his consulting company’s bank account and then sent most of the money to an unknown business, according to federal law enforcement sources.

Of the total, Bagley kept about $300,000 in fees. In 2019, the U.S. Treasury Department sanctioned Saab for allegedly profiting from a no-bid contract to import food to Venezuela for President Maduro’s socialist government — the very deal in which Bagley consulted Saab, sources told the Miami Herald. At the same time, Saab was indicted in Miami federal court on charges of conspiring to commit money laundering and multiple related counts tied to a public housing program run by Maduro.

Maduro himself was charged in a drug-trafficking case in New York federal court last year.