The Swiss who laundered money for the Chavist oligarchy and is a key witness against Maduro’s children

Matthias Krull lifts his pant leg and places pruning shears on the ankle device that reminds him of his crimes for the past two years.

Armed with a court ruling, the former Swiss banker cuts through hard plastic, unleashing a torrent of excitement. “Physically I’m used to it, but psychologically it’s liberating,” said Krull, 47, of his rented house in Miami. “Being able to wear shorts again is a good thing. I went to my son’s soccer games, it was 100 degrees (about 38 degrees Fahrenheit) and everyone was wearing shorts. “

Krull’s legal problems stem from his work in Venezuela, which has been plagued by corruption during two decades of socialist rule. At the time, Krull, who worked for the Julius Baer group, he was the private banker of those connected with the government. Among his clients were the stepchildren of Nicolás Maduro.

During a meeting in 2017, he met the real beneficiaries of the operation that would send him to prison. They were Maduro’s stepchildren

The banker was arrested in 2018 at the Miami airport and treated for money laundering, which began his second act as star witness to U.S. federal investigators attempting to dismantle the corrupt Venezuelan network that has embezzled billions of dollars from oil.

Krull’s help was decisive. Since he pleaded guilty helped the prosecution to recruit other Swiss bankers as witnesses, pressured others to surrender and participated in European inquiries.

In recognition of these efforts, a judge in September reduced his original 10-year prison sentence by 65% ​​and allowed him to withdraw the tracking device. He is expected to start his 42-month sentence this summer.

Importantly, the process raises a more pressing question: whether someone else was responsible. Although the Julius Baer Group canceled Krull’s actions as a rogue employee, the Swiss regulator found last year that the entity ignored red flags and encouraged bad behavior. “The goal was to make new money,” Krull said. “They didn’t really care about the profitability of the accounts.”

Zurich-based Julius Baer declined to answer questions in detail, so this dispatch reflects Krull’s point of view, expressed in various interviews. Many details are supported by court documents and US officials.

For Krull’s rivals, their advantage lay in their childhood. His father, a Lutheran pastor, moved there with the family from Germany when Krull was 7 years old. At a private German school in Caracas, he built a network of contacts among the city’s elite while learning mountain town lingo.

“The joke among the bankers was that the money was thrown on the floor, you just had to take it”

His early years at Julius Baer were a whirlwind fueled by good times. Hugo Chávez was at the height of his power, oil prices hit record highs, and wealthy Venezuelans were looking for ways to keep their money abroad..

“The joke among the bankers was that the money was thrown on the floor, you just had to take it“, He said.

Krull believes that managed over $ 1 billion in deposits, which gave him access to the “Presidents Club” of Julius Baer, ​​the top 10% of managers.

But there was a riskier side. Kidnappings and banker extortions were common, and Krull traveled with an armed bodyguard. After a shooting outside his department by men apparently looking for him, Krull moved to Panama, but continued to travel to Venezuela on business.

A high-risk currency swap gone awry led to Krull’s arrest, although his role in the operation was limited and only intervened towards the end, according to U.S. investigators.

After a shootout outside his department of men who were apparently looking for him, Krull moved to Panama.

In 2014, one of Krull’s clients granted a loan in Bolivars to the Venezuelan state oil monopoly PDVSA. The oil company repaid the loan two months later in dollars at an exchange rate much higher than the official rate, which allowed the conspirators to take 15 times the amount loaned., according to the criminal complaint against Krull.

Two years later, Krull’s client asked him transfer $ 200 million in bogus loan proceeds to a foreign bank account, according to the researchers.

Krull has been instructed by his employer to avoid any transactions involving the oil company. So he put his former client in touch with a manager in Panama who, unbeknownst to the other two, was an informant for the US government.

In a meeting at the client’s office in January 2017, Krull met the real beneficiaries of the $ 200 million deal: three men in baseball caps and gold chains presented as “Los Chamos,” a familiar form of saying “boys”. They were Maduro’s stepchildren.

“At that moment I realized the situation was great for meSaid Krull, who snuck out to eat with the heart pounding men.

Krull insists he has become the scapegoat for a private banking system based on secrecy and has facilitated the looting of Venezuelan coffers.

He filed a wrongful dismissal lawsuit against Julius Baer in Venezuela, in which he described the meeting in early 2017 where he discussed with his superiors what to do with various clients for whom information had been provided to the United States Department of Justice.

“The only objective was to continue to generate income for the bank and not to take any real and concrete measures to prevent money laundering”

Krull alleges that he was instructed not to turn away clients and to keep their personal accounts open.

“The only objective was to continue to generate income for the bank and not to take any real and concrete steps to prevent money laundering.Krull alleges in his lawsuit.

Last year, the Swiss regulator identified numerous transactions over a decade that point to “systemic failures” at Julius Baer.

Specifically, the Paternity concluded that the entity had “significant” failures when it came to investigating the identity of Latin American clients and compensated the bankers for attracting new funds without caring about the compliance with legal requirements.

In a statement, Julius Baer said the criminal activity to which Krull pleaded guilty occurred outside of his office. The bank claims to have cooperated with the Swiss authorities.

Bank says it cooperated with Swiss authorities and Krull’s criminal activity occurred outside of his job

Money laundering expert Mark Pieth said that in recent years there have been several scandals with Swiss banks, so there is no excuse for not knowing the source of the huge sums of money collected by their collaborators in Venezuela.

“With Venezuela, all alarms should have sounded,” Pieth said.

The expert said he was surprised that no charges were brought against more Swiss financial managers. In Switzerland, financial markets supervisor FINMA sent letters of reprimand to two senior executives in connection with the Julius Baer investigation, a punishment Pieth likened to “a punch”.

“It’s like asking casinos to identify gambling addicts,” he said.

Now, while waiting to serve his sentence, Krull spends the day taking his kids to soccer games and talking to old friends.

“I especially regret having been drawn into this situation, I did not have the strength to sound the alarm and take a step forward by talking to the right people.Krull said. “It will stay with me for the rest of my life“.

(With AP information)

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