The biggest threat to Kentucky Derby winner California Chrome in the second leg of horse racing’s Triple Crown comes from a Venezuelan-owned stable whose horses have names inspired by late President Hugo Chavez’s socialist revolution.
Herman Sifontes used to manage more than $200 million in client assets as the head of Venezuela’s largest brokerage. Then, in the spring of 2010, he was arrested and his firm was shut down as part of a purge of brokers by President Hugo Chavez.
Venezuela has taken control of eight brokerages as part of a probe into irregularities in foreign currency transactions and raided two more firms as President Hugo Chavez tightens his grip on the financial sector.
An official of Venezuela’s securities regulator was charged by federal prosecutors in Miami with seeking to extort $1.5 million from the owner of a Caracas brokerage firm placed under government control.
Trader Jofmar Heredia was thrown out of work when Venezuelan President Hugo Chavez shut the unregulated currency market in May and seized about 40 brokerages, accusing them of setting artificial rates, capital flight and money laundering.
Venezuelan authorities have arrested executives from three brokerages in the last two days who will face arraignment today as part of an investigation into irregularities in the unregulated currency market.