Case 1:18-cr-20682-CMA Document 30 Entered on FLSD Docket 08/22/2018 Page 1 of 9

UN ITED STA TES D ISTR IC T CO UR T

SO U TIIER N DISTRIC T O F FL O R ID A
CA SE N O .18-CR-20682-A LTON A G A

U NITED STA TES O F A M ER ICA

M ATTH IA S K RU LL

D efendant.

FA CT UA T,PR O FFER

The U nited States ofA m edca and M atthias KRU LL stipulate thatif this m atter w ere to

proceed to trial,the G overnm entw ould prove the stated factsbeyond a reasonable doubt:

Introduction

From December2014 tllrough July 2018,KRULL,along with Francisco Convit

Guruceaga,JoseVincenteAmparan Croquer,a.k.a.çEchente,''Carm elo Antorlio Urdarieta Aqui,

Abraham Edgardo Ortega,Gustavo A dolfo H ernandez Fded,M arcelo Federico Gutierrez'A costa

Lara, and M ado Emique Bonilla Vallera and others, conspired to engage in m onetary

transactions,conceal,disguise,and otherwise launderhundredsofm illions ofU .S.dollars'w orth

offunds,which they believed andwllich in factweretheproceedsofcriminalactivity (thatis,

foreign bribery and violations of the Foreign Corrupt Practices Act (FCPAI), including
transactionsw ith EGU .S.FinancialInstitution 1,''an FD IC insured bank atld Ef nancialinstitm ion,''

asdefinedinTitle18,UnitedStatesCode,Section 1956(c)(6)(A),in violationofTitle 18,Urlited

StatesCode,Section Sections1956(h)and1957.
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In addition,KRULL and others traveled in and used facilities of interstate and

foreign com m erce to m anage and prom ote both their m oney laundering activities and violations

ofthe Bank Secrecy A ct,Title 31,United States Code,Section 5322.

Background:CorruptC urrency Exchange Schem es

A t a1l relevant tim es,V enezuela had a foreign-currency exchange system under

whichthegovernmentwillexchangelocalcurrency(Bolivars)atafixedrateforU.S.Dollars.The
fixed exchangeratehasbeen wellbelow thetrue econom icrateby asubstantialfactorforseveral

yCarS.

Forexample,in 2014,an individualcouldexchange 10m illion U.S.Dollarsfor600

m illion Bolivars atthe true econom ic rate.Then,ifthatindividualhad access to the governm ent

fixed rate, he could convert that sam e'600 m illion Bolivars into 100 m illion U .S. D ollars.

Essentially,in tw o transactions,thatperson could buy 100 m illion U .S.Dollarsfor 10 rnillion U .S.

D ollars.

The difference between the fixed rate and the true econom ic rate creates

opporturlity for fraud and abuse, where V enezuelan officials engage in these foreir currency

exchange schem esin retum forbribes and kickbacks.

6. These com zpt foreign currency exchange schem es occlzr in significant am otm t

witllinVenezuelanstate-ownedoilcompany,PetréleosdeVenezuela,S.A.(PDVSA).PDVSA is
Venemzela'sprimary sourceofincome and foreign currency (namely,U.S.DollarsandEuros),
and serves asthe solzrce offoreign currency used to fund cornzptforeign exchange em bezzlem ent

schem es.
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In this case,as setforth in inore detailbelow , K RU LL and others conspired to

launder and engage in m onetary transactions w ith the proceeds of a con-upt currency exchange

schem e w ith PD V SA .

Background:False-lnvestm entM oney L aundering

8. K RU LL and other m em bers of the conspiracy are sophisticated operators w ith

respectto the intem ationalbanking system and are aw are ofbanks'generaldue diligenceand anti-
1.

moneylatmdedngpractices,includingknow-your-customer(KYC)requirements.
Im portantly, for one party to w ire fnnds to a third party, there m ust be som e

legitimatebusinessjustificationprovidedtothebank;forinstance,apaymentforthepurchaseof
realestateorequipment.M oreover,abank willask fordoclzmentssupporting thejustification,
which---depending on the transaction-r-can be difficultto m anufacture;for instance,a bank m ay

be able to verify w hether a supposed realestate transaction took place.Tllis vetitk ation poses a

problem for m oney laundering kansactions in w hich large sum s of crim inalproceeds m ustbe

m oved around the tinancialsystem f'

rom one person to another as bribes,ldckbacks,transfers,or

exorbitantexpenditures,forinstance.

10. Accordingly,false investmentsin fakeseturitiesare convenientjustificationsin

that they are m ore diftk ult for a bazlk to investigate and verify.By w ay of exam ple,one party

mightwire30millionU.S.Dollarstoathirdpartywith thejustificationthattheamountisaloan
to the third party,supported by a 30 m illion U .S.Dollarprom issory note due atsom e pointin the

futttre,which neither party acm ally intendsto honor.Forthe bank,ascertaining the tnze intentof

the parties and the fraudulentnature ofthe investm entisdifficult.

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Sophisticated false-invesu entmoney latmdering schem esareusedthroughoutthis

conspiracy,rangingfrom individualfalsesecurities(promissorynotesandbonds)to entirefalse-

investmentftmds,wllichcanbesubscdbedtoasneededtojustifytransactions.
12. Surrouùding and supporting these false-investm ent laundering schem es are

com plicitm oney m anagers,brokerage firm s,banks,and realestate investm entfilnnsin the United

States and elsewhere,operating as anetw ork ofprofessionalm oney launderers.

C orruptPD V SA Exchange Schem e

Theplzrposesofthemoney laundering conspiracy in thiscasew asto launder$1.2

billion U .S.Dollars'w orth of funds em bezzled from PDV SA by V enezuelan ofticials,including

by Qtvenezaelan Official1,''who wasa Gçforeign official''asthatterm isdefined in theFCPA,and

who authorized the em bezzlem entin exchange forkickbacks.

14. The em bezzlem ent operated by w ay of a PD V SA foreign-currency exchange

schem e benetm ing Eaton G lobal. The exchange schem e w as disguised as a tf nancing''

arrangem entusing the follow ing three docum entsin an artlessattem ptto hide the em bezzlem ent:

a. First,a loan contract,dated Decem ber 17,2014,between PDVSA

and R antor CapitalC.A .,a Venezuelan shellcom pany,in which Rantor agreed to

loan 7.2 billion Bolivars to PD V SA . The loan contract w as executed by

G'V enezuelan Official1''a.V ice PresidentofPD V SA ;

b. Second,an assippm entcontract,datedDecember23,2014,between

Rantor and Eaton Global,in w hich Rantor assigns its dghts as PD V SA 'S creditor

undertheloan contractto Eaton G lobaland in w hich itiscontem plated thatPD V SA

is given the rightto'cancelthe debtwithin 180 daysby paying 600 m illion U .S.

Dollars;and

4
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C. Third,a notice of assignm ent letter,dated D ecem ber 23,2014,in

whichEatonGlobalinformsPDVSA (i.e.,VenezuelanOfficial1)oftheassignment
and suggests thatPDV SA repay the 7.2 billion Bolivarloan in the Euro equivalent

of600 m illion U .S.D ollars.

15. In sholt Eaton Global,which was controlled by m embers of the conspiracy,

received about 511 m illion Euros f'

rom PD V SA after loaning PD V SA about7.2 billion Bolivars

(wortharound35millionElzros)fornomorethanafew months.
16. V eneztzelan O fficial1,and others,facilitated thisschem e in exchange forreceiving

ldckbacks fr
'om the proceeds.Tllis bribery ofV enezuelan O ftk ial1 violated rm tonly V enezuelan

law ,butalso the Foreir Com zptPractices A ctbecause one orm ore m em bers of the conspiracy

engaged in com zptactsfrom w ithin the territory ofthe United States.A ta1lrelevanttim es:

a. Em bezzlem entofpublic funds by a public officialand bribery of a public

officialw asan offense againstthe nation ofV enezuela,under m ore than oneprovision of

V enezuelan law .

b. The com zptuse offacilitiesofinterstate comm erceorany otheract,while

in theterritol'y oftheU nited States,to ftzrtherapaym entorprom ise ofapaym entto aforeign

officialfortheptupose ofinfluencing orinducing thatoftk ialto act,w as a felony violation

ofthe Foreign CozruptPractices A ct.

Accordingly,the proceedsofthe PD V SA foreign-exchange em bezzlem entschem e

paid to Eaton Globalare theproceedsofspecified unlaw fulactivity asdefned in Title 18,U nited

StatesCode,Section 1956(c)(7).
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18. The m em bers ofthe conspiracy areed to splitthe netproceeds ofthe PDVSA

foreign-exchange em bezzlem entschem e as follow s:

a. 227 million E'

uroswentto the :EBo1i''(Francisco ConvitGunzceaga and
Gçconspirator2'')7
'and
b. 227 million Euroswentto GGconspirator7''

19. From there,the m em bersofthe conspiracy agreed to furtherdistributetheproceeds

am ong som e ofthe m em bers ofthe conspiracy,forinstance:

a. The ççBoli''routed approxim ately 78 million Eurosto a confidentialsource

(CS),whowasinstnzctedtodeliverthefundstoCnnneloUrdanetaAqui,Abraham Ortega,
Ktconspirators 1 and 3,''and V enezuelan O fticial1,
'and

b. tdconspirator 7'' routed approxim ately 159 m illion Etlros to tlzree

individuals know n as çt os Cham os,''the stepsons of Gçvenezuelan Oftk ial2,''who w as a

ç<foreign official''asthatterm is defined in the FCPA .

20. In ordertoconcealthenamre,sourceand controlofthePDV SA funds,them embers

ofthe conspiracy included an array ofstraw ow ners,bankers,m oney m anagers whose role w asto

facilitate the latm dering.

K R U LL'SR ole in the C onspiracy to L aunder the PD V SA Funds

KRULL'Srolein thisconspiracy wasasabankerand m oney launderingfacilitator

fort'Conspirator 7''and others.

22. Untilapproxim ately M ay of2018,ICRU LL w as em ployed ata Sw issbank w here

he w as a M anaging D irector and V ice Chairm an.K RULL'S role w as attracting pdvate banking

clientsto the bank,pdm adly from V enezuela.

6
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In this role as a G<door openerv'' K RU LL counted as private banking clients:

Francisco ConvitGunzceaga,and Conspirators 2,7 and 9,dating back severalyears.

In oraround 2016,Conspirator7 contacted K RU LL aboutlaundering the proceeds

ofthe PDV SA foreign exchange em bezzlem entschem e.

25. Initially,Conspirator 7 intkorm ed K RULL about a tranche ofm oney w orth about

600 m illion U .S. D ollars generated from foreign exchange contracts. Conspirator 7 stated he

needed a solution form oving and depositing the funds. KRU LL asked Conspirator7 forthe solzrce

ofthefunds,and Conspirator7provided KRULL acopy ofan addendtlm to the odginalPDV SA

and Rantorloan contact,w llich doubled the initialcreditline from 7.2 to 14 billion Bolivars.The

am endm ent w as dated M ay 25, 2015 and specifically incorporated the initial PD V SA loan

contr
1
act.
.

26. Conspirator 7 later sum m oned K RU LL to his office in V enezuela regarding a

tranche ofm oney worth about200 million U.S.Dollars. Conspirator7 stated thatheneeded an

urgentsolution form oving these funds,and thathew anted ICRU LL to m eetthe ow nerofthe funds.

27. At Conspirator's 7 oftice, Conspirator 7 introduced K RULL to M ado Endque

BonillaVallera(formerlyreferredtoasççconspirator8'')andEfonspirator10,''bothasthepeople
who Conspirator 7 t'represents.''

28. Conspirator 7,in tut'n,asked K RU LL if K RU LL knew w ho QçM atio''represents.

W hen K RU LL answ ered GGno7''Conspirator 7 explained that tçM ario''represents Et os Cham os''

(thestepsonsofVenezuelan Official2).Conspirator7explainedtoKRULL how t<lwosChamos''

help Conspirator7 solve issuesw ith V enezuelan O ftk ial2,by intervening w ith their m other,the

w ife ofV enezuelan O fficial2.

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29. Conspirator 7 then introduced K RU LL to (ttaos Chafnos''w ho w ere seated in the

nextroom ,with Conspirator9 and Gf onspirator 11,''wearinghatsand chains.Itwasexplainedto

KRULL thatM arioEnriqueBonillaValleraand Conspirator10wouldbethestraw accotmtowqers

forft os Cham osy''forw hateversolution K RU LL provided.

30. Copspirator7explainedtoIQRULLthathe(Conspirator7)wasdispleasedwiththe
previouseffortsofJose Vincente Amparan Croquerand theGGportugilese guy''(Hugo Gois)to
managethemoney.KRULL agreedtoassistandjointheconspiracytolaunderthefunds.
K RULL m etw ith M ario Endque Bonilla V allera and Conspirator 10 on several

occasions in an effort to assist them in receiving the PD V SA ftm ds as straw owners for the

G<cham os,''including as pa14 of a proposed plan to use a m oney laundedng structure w ith Global

SecudtiesA dvisors and Gustavo Hpernandez Fderiin M iam i,Florida which included deposits to

be m ade to U .S.FinancialInstitution 1.

KRU LL and Conspirator7 had additionalm eetings,including one on FisherIsland

in the Southern Districtof Flodda,where Conspirator 7 was renovating a condom izlium .D uring

thatm eeting,Conspirator 7 called Conspirator 11 to inquire as to the status ofproviding K RULL

w ith the necessary docum entsto m ove the ftm ds forthe ddtaos Cham os.''

33. KRU LL w as specifically aw are that Conspirator 7 w as previously involved in

another co= ption schem e involving a ltigh-levelV eneztzelan oftk ialfrom Conspirator 7's ow n

paststatem entsto K RULL.

8
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K RULL lcnew thathe w as participating in an illegalm oney laundering çonspiracy

and that the funds he w as attem pting to conceal and transactin w ere the proceeds of crim inal

activity and bribery in particular.

BEN JA M W G .G REEN BERG

UNITED STATES ATTORNEY

Date: 7w t By.
FR A CISCO R.M A ERAL
M ICHA EL B .N A DLER
A SSISTA N T U N ITED STA TES A TTORN EY S

SAN DR A L.M O SER

A CTIN G CH IEF,FM U D SECTION
U .S.D epartm entofJustice,Crim inalD ivision

oate,+2wplï%C By: ,
'
x / ;
DA V S.JOHN SO
A SS TA N T CH IEF
GW DO LY N A .STA M PER
TRIAL A TTO RN EY

Date: t %. h%
O SCA A G O DRI
A TTORN E FEN D

Date:% =* hes
M ATTHIAS ULL
DEFEN D A T