June 3, 2019
(Reuters) – The U.S. Department of Justice is seeking documents from Citgo Petroleum Corp as part of an investigation into bribery by U.S. suppliers involving its Venezuelan parent, state-owned Petroleos de Venezuela.
Citgo confirmed the receipt of a subpoena and said in a statement on Monday it agreed to cooperate with the U.S. probe.
The Houston-based oil refiner appointed a new board of directors earlier this year and cut ties with PDVSA following U.S. sanctions designed to stop the flow of U.S. dollars to Venezuela and ratchet up pressure to force socialist President Nicolas Maduro from power. The Unite
“Earlier this year, under the direction of its newly appointed Board, Citgo engaged outside counsel to conduct an independent investigation, and is committed to taking all appropriate remedial actions in response to the findings,” the company’s statement said. A spokeswoman declined further comment.
The Justice Department’s probe into bribery at PDVSA has resulted in charges against 21 people, 16 of whom have pleaded guilty as of this month. Maduro’s government has described the U.S. investigations as politically motivated.
The disclosure of a Citgo subpoena, which was earlier reported by Bloomberg, followed a guilty plea by Miami business owner Jose Manuel Gonzalez Testino over bribes paid to PDVSA and Citgo to obtain energy and logistics contracts.
Gonzalez admitted he and co-conspirators between late 2012 and mid-2013 paid at least four Citgo officials and provided gifts to a senior Citgo executive in return for help winning contracts, the Justice Department said last week. He was charged with paying at least $629,000 to a PDVSA procurement official.
Citgo’s outside lawyers have been reviewing procurement activity during the period that Gonzalez admitted to running the scheme, the company told employees last week.
“These charges are quite troubling,” Citgo Chairwoman Luisa Palacios and Executive Vice President Rick Esser wrote to employees. “Citgo takes seriously all allegations of unlawful or improper activity.”
Citgo, which earned $851 million on more than $23 billion in 2018 revenues, operates three U.S. refineries that supply about 4 percent of U.S. fuels. It employs about 3,400 workers and supplies a retail network that spans about 30 states.
(Reporting by Gary McWilliams; Editing by Peter Cooney)