CARACAS--A United Nations panel on human rights has deemed the imprisonment of four former directors of Venezuelan brokerage house Econoinvest Casa de Bolsa CA "arbitrary" and called for the release of the bankers, who have been held in a state detention center for two years without a trial.
In its statement, the U.N.'s Working Group on Arbitrary Detention said the imprisoning of the Econoinvest directors appeared to "violate human rights." The agency added that it hadn't received a response from the Venezuelan government after a request for information was made last year.
With some $200 million in assets under management, Econoinvest was one of Venezuela's largest financial firms until its offices were raided by authorities in May 2010. The directors--Herman Sifontes, Miguel Osio Zamora, Juan Carlos Carvallo and Ernesto Rangel--were sent to prison as part of President Hugo Chavez's crackdown on a currency black market where dollar-denominated government bonds were sold for bolivars as a way for the private sector to get its hands on much-needed dollars.
Mr. Chavez, who dubbed Econoinvest and other brokerage houses "a mafia," said these businesses were violating strict currency controls in Venezuela that make purchasing dollars illegal unless done through the government. The leftist leader also blamed them for contributing to a rapid depreciation in the oil-rich South American country's bolivar currency and surging inflation.
Lawyers for Econoinvest, however, contend that the government is wrongfully holding the directors and is retroactively implementing a ban on commercializing dollar-denominated sovereign bonds, legislation that was added to the country's legal code shortly before the arrest of the bankers.
In its report, the U.N. panel notes that Econoinvest stopped the commercial sale of Venezuelan bonds on May 10, 2010, while Venezuelan authorities changed the law to ban the process a week later. Venezuela's attorney general didn't respond to calls seeking comment.
The U.N. opinion was adopted late last year but was released to reporters by Econoinvest's legal team Thursday.
After multiple delays and cancelled hearings, their case is set to go to trial Monday.
Beatriz Di Totto, a lawyer representing Econoinvest, said her legal team plans to use the document to plea for the release of her clients. She added that they intended to present it to the judge last month at a hearing but the proceeding was cancelled after the prosecution didn't appear in court.
Members of the defense have charged that the government has been trying to delay the case.
More than two years after the government's dismantling of the brokerage-house operations, Venezuelan inflation remains at a high annualized rate of 22%, and one dollar continues to fetch more than VEF8.5 on the black market, compared with the state-set rate of VEF4.3 for each dollar.
The Wall Street Journal, 21/06/2012