The ‘Naming and Shaming’ Prosecutions of Venezuela

The ‘Naming and Shaming’ Prosecutions of Venezuela

Since at least 2010, the US Department of Justice has been conducting a broad-ranging criminal investigation into crimes committed by Venezuelan former and current officials and businesspeople. The investigation exposed, among other crimes: the embezzlement of $1.2 billion of funds from the Venezuelan state-owned and state-controlled energy company, Petroleos de Venezuela S.A. (PDVSA), profuse bribery of officials at PDVSA and the PDVSA subsidiary Citgo Petroleum Corporation, and massive amounts of laundering of PDVSA-related embezzled funds and bribe payments.

The Justice Department’s investigation also documented an intricate web of criminality that included former PDVSA officials, professional third-party money launderers, and members of the Venezuelan elite. The investigation led to the Justice Department obtaining criminal charges against 28 individuals to date, 22 of whom have pleaded guilty. The US Department of Treasury’s Office of Foreign Assets Control has also been able to sanction individuals and companies related to the PDVSA embezzlement scheme.

Since 2017, however, the purpose and importance of those prosecutions were increasingly overshadowed by the Trump administration’s strategy of so-called “maximum pressure” against the authoritarian regime of President Nicolás Maduro Moros. That strategy, which sought to force Maduro from office, intensified after he was reelected in 2018 in an election reportedly marked with massive irregularities. Subsequently, in 2019 the Venezuelan political opposition declared the position of president vacant and ratified the then-National Assembly President Juan Guaidó as interim president.

By 2020, the Trump administration escalated its “maximum pressure” strategy, with the United States and other countries recognizing Guaidó as the legitimate interim president. The United States began to apply a combination of diplomatic, financial, economic, and political measures to drive Maduro from office and enable a transition government to convene free and fair elections. Those measures also included the active support of then-Attorney General William Barr for the Justice Department obtaining indictments of Maduro himself and 14 other current or former senior Venezuelan officials for a vareity of charges, including narco-terrorism and cocaine-importation conspiracy, corruption, and money laundering. Collectively, these are known as the “2020 Maduro indictments.”

But by early 2021, the “maximum pressure” strategy was in tatters. The 2020 Maduro indictments yielded no arrests of indicted officials in Venezuela, European Union member states and various Latin American nations no longer recognized Guaidó as the interim president, and Maduro maintained his grip on power despite an increasingly severe humanitarian and refugee crisis inside Venezuela.

In the wake of that now-discredited and failed strategy, some people might be tempted to ask whether the Justice Department is, as Venezuelans say, “Más perdido que Adán el día de las Madres” (more lost than Adam on Mother’s Day — i.e., very lost). It is, therefore, important to recognize a critical difference between the Justice Department’s PDVSA-related prosecutions and the 2020 Maduro indictments.

THE DIFFERENCE

There should be no doubt that the Maduro regime is, in the words of Attorney General Barr, “awash in corruption and criminality.” Nor is there any reason to doubt that the Justice Department and other US law enforcement agencies have credible evidence to support the 2020 Maduro indictments.

[W]hen the Justice Department had no realistic expectation of apprehending any of the Maduro-indictment defendants in Venezuela, it is evident that the primary true purpose of those indictments was to “name and shame” Maduro and his regime, rather than to accomplish genuine enforcement of US laws.

What distinguishes the PDVSA prosecutions from those indictments is one simple fact.  In the PDVSA-related cases, US authorities not only obtained credible evidence of numerous individuals’ participation in PDVSA-related bribery, but had some reasonable expectation of obtaining personal jurisdiction over those people — either because those individuals were already physically present in the United States or could be extradited from third countries to the United States to face US charges.

By contrast, the individuals named in the 2020 Maduro-related indictments who reside in Venezuela have no reason to fear that the Justice Department can force their extradition to stand trial. Maduro and his henchmen continue to control the levers of power, even as Venezuela slides closer to failed-state status, and can be expected to do so for years to come.

There is one recent precedent for indicting a current head of state such as Maduro on drug- and corruption-related charges. In 1988, the Justice Department obtained indictments against the then-ruler of Panama, General Manuel Noriega, for taking massive payoffs to allow cocaine trafficking into the United States. It is worth remembering, however, that what it took to make those charges stick was “Operation Just Cause,” a full-blown invasion of Panama by the US military for the purpose of ousting Noriega. Not even the Trump administration was willing to pursue a similar full-scale invasion of Venezuela for a similar purpose as part of its “maximum pressure” campaign, despite President Trump’s repeated musings about doing so.

In those circumstances, when the Justice Department had no realistic expectation of apprehending any of the Maduro-indictment defendants in Venezuela, it is evident that the primary true purpose of those indictments was to “name and shame” Maduro and his regime, rather than to accomplish genuine enforcement of US laws.

WHAT THE JUSTICE DEPARTMENT CAN DO — BUT SHOULDN’T

Nothing in the Justice Department’s Principles of Federal Prosecution specifically bars the Department from “naming and shaming.” At the same time, the American Bar Association’s Standards for the Prosecution Function make clear that:

[t]he primary duty of the prosecutor is to seek justice within the bounds of the law, not merely to convict. The prosecutor serves the public interest and should act with integrity and balanced judgment to increase public safety both by pursuing appropriate criminal charges of appropriate severity, and by exercising discretion to not pursue criminal charges in appropriate circumstances. (Emphasis added)

Although the ABA Standards are not mandatory for prosecutors, they remind prosecutors that they must exercise informed discretion in deciding whether to bring criminal charges. That exercise of discretion certainly includes federal prosecutors’ obtaining an indictment and having that indictment sealed in order not to tip off that person while federal agents seek to arrest him. And it includes indicting a person who is located in a foreign jurisdiction from which prosecutors have some hope of lawful extradition. On the other hand, using indictments solely for “naming and shaming,” with no prospect of actual prosecution, should be considered beyond the pale of prosecutorial discretion in any administration.

NOT LOST BUT WAYWARD

In short, the Justice Department is not “lost” in continuing its important work in bringing to justice all those who played roles in the massive PDVSA scandal. But using indictments useful only for “naming and shaming” as part of an incoherent foreign policy public relations campaign does a significant disservice to the dedicated professionals of the Department, the US system of justice and, in the end, to the responsible and level-headed conduct of US foreign policy.

In its Interim National Security Strategic Guidance, the Biden administration has its commitment to combating corruption, especially in the Western Hemisphere, a priority. In Venezuela’s case, that commitment should include continuing pursuit of the PDVSA investigation and bringing corrupt individuals and companies to justice, wherever they can be reached. “Naming and shaming” indictments like the 2020 Maduro indictments, should play no role in fulfilling that commitment.

Jonathan J. Rusch is adjunct Professor at Georgetown University Law Center and American University Washington College of Law, and a former Deputy Chief with the US Department of Justice’s Fraud Section. He teaches courses on anti-corruption law and anti-money laundering law.

Source: InkStickMedia

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