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 October 23, 2015 - 4:00 PM EDT
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Venezuela's Central Bank Files Lawsuit to Shut Down Black Market Currency Website DolarToday for Falsifying Exchange Rates

Offshore Company Deliberately Worsening Conditions to Undermine the Country's Economy

The Central Bank of Venezuela, represented by law firm Squire Patton Boggs, today filed suit in U.S. District Court to halt the operation of DolarToday LLC, an offshore website that allegedly misrepresents and falsifies Venezuela’s national currency rates in an attempt to further destabilize the country’s economy.

According to the suit, DolarToday fabricates black market exchange rates that it publishes via the company’s website and smartphone applications. The rates published by the website do not represent any official Venezuelan fiscal policy.

The lawsuit alleges that DolarToday is damaging Venezuela’s economy by exacerbating inflationary pressures, diminishing the purchasing power of the Venezuelan people and undermining the authority of the Central Bank.

Venezuelan business representatives said they filed the suit because they consider the use of technology from outside the country to weaken their nation’s economy a form of cyber-terrorism. They believe DolarToday’s activities are intended to harm national financial institutions and impose greater hardship on its citizens in a time of vulnerability.

Venezuela’s economy has suffered from inflation amid collapsing sales of crude oil, the nation’s primary export. The central bank’s lawsuit alleges that the owners of DolarToday, in addition to fomenting unrest in Venezuela, are also reaping personal financial gain from the currency manipulation espoused by the website.

Named defendants include Gustavo Díaz Vivas, formerly a colonel in the Venezuelan Army who is associated with previous attempts at overthrowing the Venezuelan government and who is now living under political asylum in Hoover, Alabama. Also named as defendants are Ivan Dario Lozada-Salas, a Venezuelan native who lives in Sammamish, Washington, and José Enrique Altuve Lozada, a native Venezuelan and cousin of Lozada who resides in Doral, Florida.

The complaint charges that the defendants “seek only to grab riches and power for themselves and their friends, willingly increasing the hardships of ordinary Venezuelans in the process.” It notes that the intent of the website is to frighten the Venezuelan populace who elected the Republic’s current government, hoping that voters “will turn on their leaders, and blame them for the harm caused by defendants” and usher in a new government that will enable the defendants and their allies further enrich themselves.

The lawsuit alleges Altuve updates the DT Rate on the website often several times daily and directs or helps direct the DT Site’s movement to mirror sites in order to evade attempts by Venezuela to block it from view in that country.

The lawsuit does not seek to shut down the website. Instead, the complaint asks the U.S. District Court to order defendants to stop publishing their exchange rate. It also asks for defendants to forfeit their financial gain from currency manipulation and place it in a trust for the Venezuelan people, pay treble punitive damages under the U.S. Racketeer Influenced and Corrupt Organizations Act (RICO), and pay the Central Bank’s litigation fees related to the lawsuit.

“Arbitrarily manufacturing currency exchange rates creates further turmoil in a country that is working to overcome the obstacles it already faces in sustaining its economy,” said Adam Fox, a Squire Patton Boggs attorney representing the Central Bank in the case. “In seeking to manipulate global markets by subverting government fiscal policy, DolarToday unlawfully hinders Venezuela’s ability to manage its economic affairs.”

DolarToday operates through a limited liability company that is organized in Delaware.

For more information or a copy of the complaint, please contact Adam Fox at adam.fox@squirepb.com

Squire Patton Boggs
Adam Fox, 213-689-5166
Cell: 213-290-5166
adam.fox@squirepb.com


Source: Business Wire (October 23, 2015 - 4:00 PM EDT)

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