October 17, 2008
A key witness in the Venezuelan suitcase trial will be allowed to testify before jurors next week, and his testimony is certain to drum up more controversy in the hemispheric scandal.
The convicted partner of a wealthy Venezuelan businessman will be allowed to testify at a Miami trial about millions of dollars in kickbacks allegedly paid to senior officials in the government of President Hugo Chávez, a federal judge ruled Friday.
U.S. District Judge Joan Lenard's ruling came after the unexpected testimony of Carlos Kauffmann, who took the witness stand Friday without a jury present so the judge could make her decision.
Kauffmann told the judge that he and his partner, Franklin Durán, paid top officials in the Venezuelan National Guard, Finance Ministry and Education Ministry to obtain government business.
Kauffmann had already pleaded guilty to failing to register last year as a foreign agent in the United States -- the same charges Durán faces during his current trial.
Kauffmann's testimony will no doubt add an explosive dimension to the 7-week-old trial, a political legal drama that is already reverberating from Miami to Caracas to Buenos Aires. He is scheduled to take the stand on Tuesday.
Although the U.S. case is solely focused on the foreign agent charges, the chain of events leading to the Miami trial is part of a hemispheric scandal rooted in South America.
It unraveled in August 2007 when an Argentine customs agent in Buenos Aires discovered a suitcase filled with $800,000. The cash -- seized from Venezuelan businessman Guido Alejandro Antonini Wilson -- was intended as a campaign gift from the Chávez government to Cristina Fernández de Kirchner. She won last year's presidential election.
Both Chávez and Fernández have denied allegations that the money was meant for her and have called the U.S. criminal case ``garbage.''
Kauffmann and Durán are among five men charged last year with failing to register as foreign agents with U.S. authorities. The men came to Miami to hush up Antonini and the fact that cash had come from Venezuela's national oil company. Kauffmann admitted to his part in the plot.
Kauffmann's bribery allegations have emerged before in court records, but his actual testimony is likely to draw far more international scrutiny because he is expected to name names -- specifically senior officials who allegedly received tens of millions of dollars in bribes.
Kauffmann recounted Friday how the two began working together a decade ago and became multimillionaires by paying kickbacks to top Venezuelan officials in exchange for lucrative contracts.
''We gave part of it to the people in government,'' Kauffmann testified.
In one deal, Kauffmann said he and Durán bought a Citibank building for $4.5 million in Caracas in 2002 so the Venezuelan Finance Ministry could purchase it for $9.5 million. The partners kept about $500,000 and kicked back $4.5 million to four senior officials in that agency, Kauffmann testified, identifying them as Tobias Nobrega, Jesus Bermudez, Lenin Aguilera and Alejandro Dopazo.
In another deal, Kauffmann said he and his partner paid kickbacks to officials in the Venezuelan National Guard in return for contracts with the agency and for managing bribes paid by other companies to those same officials.
Lenard said Friday she will allow Kauffmann to testify before the jury about those deals -- along with Durán's statement to the FBI after his arrest in Miami in December 2007.
In the post-arrest interview, Durán told FBI agents that he was 'able to succeed in Venezuela because he `pays off' politicians, government employees and high-ranking officials,'' according to court records.
But the judge, without explaining, disallowed his testimony on other statements he made on the witness stand Friday.
• That Kauffmann said he and his partner colluded with four Finance Ministry officials on a $100 million bond sale, kicking back about $24 million to the agency officials.
• That the partners paid off government officials in the states of Cojedes and Vargas. In one instance, they gave a $250,000 political contribution to the Vargas gubernatorial campaign of Antonio Rodriguez, Kauffmann testified.
''It was to create a bond with them . . . to get more business with the government,'' he said, adding that he and Durán received about $30 million in construction contracts from the state of Vargas.
Ed Shohat, Durán's defense attorney, has argued that his client came to South Florida on his own to try to help his former friend -- Antonini -- avoid possible charges in Argentina and was never acting as a Chávez government agent.
He also argued that no evidence during the trial shows that anyone in the Venezuelan government ordered Durán to travel to Miami and silence Antonini.
He won that argument on Thursday when Lenard ruled that jurors could consider Durán's claim of entrapment.
Assistant U.S. Attorney Thomas Mulvihill had argued that the jury must be allowed to hear Kauffmann's testimony because it shows that Durán was not ''entrapped'' by Antonini, who began cooperating with the FBI last year after he returned to his home in Key Biscayne following the seizure of the suitcase in Argentina.
During his testimony on Friday, Kauffmann said that if he, Durán and the other three men in the mission ''were able to solve this for [the] government'' of Venezuela, ``we were going to receive big payments, big contracts and big favors.''
Shohat denied that his client was ever involved in paying kickbacks to Venezuelan government officials, saying he had come to Miami last year to help a former friend avoid customs charges in Argentina.
He argued that Kauffmann's testimony would create a ''major scandal'' in Venezuela.
''Many people's lives are going to be affected in Venezuela,'' he said, declaring that ``the U.S. government has destroyed the lives of a number of people.''