Reports from Venezuela indicate chaos:
(1) All of Chavez' family have left Venezuela; some are known to be in Cuba, whilst others have relocated to Russia. His brother, Adan Chavez, has also left the country, and moved all his wealth. Their flight would support the fact that Chavez' death has already occurred.
(2) All of Chavez' personal wealth, that he had on hand in Venezuela, has been transferred out of the country; some is known to be in Russia. There is definite proof of this capital movement. Chavez has large existing accounts in Switzerland, as we have previously reported, but there is no current information on the status of these accounts.
(3) High-level government officials are also known to have already moved their wealth overseas. Some has been placed in accounts located in the Republic of Panama.
(4) As we previously reported, senior officers at the Central Bank of Venezuela are transferring funds out of the country. There does not appear to be any control on these massive funds transfers.
Will the next Venezuelan government honour financial obligations incurred by President Chavez, or will it renege on its debts, particularly to its supporters, notably China and Iran ? Whatever happens, now is the time, if you are a banker concerned with Country Risk, to reduce your financial exposure to:
(1) Venezuelan banks
(2) The so-called Bolivarian Elite, insiders who have lucrative government contracts
(3) All private and government-controlled corporations, especially the oil monopoly, PDVSA.
Whether Venezuela will now descend into financial darkness is not known, but be prepared for chaos.