Engines idled for Venezuelan race car driversBy JORGE RUEDA , Associated Press
Oct. 18, 2013 7:15 PM ET
CARACAS, Venezuela (AP) — Venezuelan officials have frozen all disbursements of hard currency to automobile and motorcycle racers who compete abroad as they investigate a corruption scandal.
Justice Minister Miguel Rodriguez told reporters Friday that some motor sports athletes have obtained hard currency for "activities that were either fictitious or overpriced."
Because Venezuela's bolivar currency does not trade on global markets, Venezuelan businesses and individuals depend upon the state agency called Cadivi to obtain dollars, euros and other freely traded currencies.
Dollars have become so scarce in this oil-rich nation plagued by economic woes, including one of the world's highest inflation rates, that they fetch on the black market more than seven times the official exchange rate.
The sports currency scandal is only the latest involving the gaming of Venezuela's currency regime. One involves buying up airline tickets for travel abroad, which lets Venezuelans withdraw $3,000 a year at the official rate.
Sports Minister Alejandra Benitez said in a newspaper interview published Thursday that an initial investigation into the Cadivi disbursements found that one driver got $66 million. She did not name the driver.
She noted that more than 98 percent of her budget for foreign competitions goes to motor sports.
Among the affected drivers is E.J. Viso, who apparently canceled his participation in this weekend's IndyCar Series' season finale in Fontana, California. Viso was listed as being "ill."
He could not be located for comment. In an interview with the El Nacional published Wednesday he said he welcomed the investigation. He is mostly sponsored by the state oil company PDVSA.
Benitez was quoted in the interview in Ultimas Noticias as saying that she had discovered that her signature had been forged on 60 disbursement files for hard currency.
Despite having the world's largest proven oil reserves, Venezuela's socialist-led government has had major difficulties managing the economy.
They grew more acute after the March 5 death of longtime President Hugo Chavez, who won broad support with expensive anti-poverty programs.
Venezuela is now plagued by shortages of foodstuffs, medicines, raw materials and parts. As a result, local industries have been hamstrung and some production lines have been halted. Annual inflation is more than 49 percent.
Associated Press writer Frank Bajak contributed to this report.