El Chino de Recadi–Another Incident of Blatant Corruption

Still considered one of the most famous cases of corruption in Venezuela, “El Chino de RECADI” exemplifies the overtly shameless levels of corruption among Venezuelan government officials and among the society at large. RECADI was the agency that was created to administer the newly created differential exchange rates in 1983. There was a preferential rate given to businesses claiming to be either importing necessary goods and services or using the cheaper foreign currency to pay interest on the foreign debt (Gates 2010). This soon proved to be almost a hoax, RECADI becoming synonymous with “magnet for corruption.” It was involved in scandals all throughout its 6 year existence. Out of $34 billion that were authorized for preferential rates, it was reported that over $11 billion went to fund corrupt transactions (Gates 2010). Everyone in society knew the trick: the agency workers handed over big chunks of cash in return for a nice commission given by businesses. Customs officials and police were often bribed so that they would sign off on imports that were indeed not necessary so that they may still qualify for the preferential rates. The rates were also authorized for friends and family members of both high and low level officials. Large phantom companies were also created in order to obtain the rates, moving millions of dollars through to several schemers.

 

The most interesting part of this whole ordeal was the end. After opening hundreds of investigations, only one conviction and arrest was made–a nationalized man of Chinese background, and the doorman of the RECADI building. After so many billions of dollars were stolen or fraudulently collected by so many parts of society, it was only this man that was served with punishment. Everyone else simply walked away with their million-dollar Miami mansions and shopping sprees.

 

 

 

http://vcrisis.com/index.php?content=letters/200403261105

http://www.lapatilla.com/site/2011/09/08/juan-carlos-marquez-la-justicia-aqui-no-es-ciega/

Electing Chávez: the business of anti-neoliberal politics in Venezuela, by: Leslie C. Gates (2010)

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1 Comment

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One response to “El Chino de Recadi–Another Incident of Blatant Corruption

  1. Mike Zaunbrecher

    El Chino’s real name was George Ho. The man who served time was another Chinese person, a “stand in”. The real Chino went to Panama. So no RECADI thief actually went to jail.

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