Central bank president Edmée Betancourt admitted that US dollars have been sold to ghost companies [View all]

[naaman fletcher]

It is a basic principle that when you have phoney exchange rates there is an incentive for those who control the issuing of currency to give it to their friends (or their own shell companies) and then sell it on the black market instead of, say, buying a price controlled product like TP and importing it.

Of course, this is what has happened. The question now is who owned these ghost companies and got the money and sold it on the black market for instant profits? Will their be any arrests?

http://www.eluniversal.com/economia/130523/central-bank-venezuelan-economy-requires-usd-3-billion-monthly

The Venezuelan government appears willing to bring order into the foreign exchange administration system after admitting publicly that "ghost firms" have been sold US dollars in recent years at a preferential exchange rate.

Central Bank of Venezuela president Edmée Betancourt confirmed that the bank has resources available for sale to the production sector, but they have to streamline the procedures and stop selling US dollars to the wrong actors.

In a meeting with entrepreneurs of the health sector, Betancourt estimated that the production apparatus demands USD 3-3.5 billion monthly, which implies USD 36-42 billion annually for imports, rather than USD 59 billion reported by the central bank in 2012.

"The amount of foreign currency sold last year was overwhelming, but there is another significant amount that was allocated to ghost firms." Further, Betancourt informed that the Ancillary Foreign Currency Administration System (Sicad) has started to deliver the US dollars sold via auction on March 27.