Thor Halvorssen Hellum - Intrigue and Mutual Accusations

Intrigue and Mutual Accusations

Three weeks after Halvorssen's release, Banco Latino folded and its directors were charged with numerous crimes. They are still fugitives. Depositors lost billions of dollars. Orlando Castro Llanes fled Venezuela and was ultimately extradited from Miami to New York to face charges of grand larceny and theft.

Castro's own banks also collapsed leaving depositors unable to recuperate their savings. On April 4, 1996, Castro Llanes was indicted in New York by District Attorney Robert Morgenthau. Castro's son and grandson were also arrested on charges of a scheme to defraud in the first degree. They were also under investigation by the US Federal Reserve for laundering more than US$3 billion. The three Castros were convicted on grand larceny charges on February 19, 1997, and in April of that year sentenced to various prison terms. The larceny involved defrauding depositors of the Banco Progreso International de Puerto Rico of as much as US$55 million. His crime also cost the government of Venezuela more than US$8 million.

His adversaries claim that Thor Halvorssen was used to prevent Castro Llanes from buying the prestigious Banco de Venezuela in 1990. While working as Venezuela's government drug czar, Halvorssen was hired by the board of the Banco de Venezuela for US$1.2 million (other sources mention US$ 7 million) to investigate whether Castro Llanes was using drug money, to thwart Castro Llanes' bitterly contested hostile takeover for control of the bank. According to Castro Llanes, he was never accepted in exclusive political and economic circles and was considered unfit by the Venezuelan elite to lead the country's most important banking institution.

A small group of shareholders, all members of the elitist Caracas Country Club, joined with the Banco Provincial, the powerful industrial group Grupo Polar and Finalven opposing the Banco Consolidado of José Alvarez Stelling, the Grupo Progreso Latinoamericano of Orlando Castro and the Grupo del Banco Unión. According to a member of the board of the Banco de Venezuela, Halvorssen was contracted to prevent at all cost that Castro would become the major shareholder and would control the bank. Halvorssen concluded that Castro Llanes was laundering drug money and was involved in other financial irregularities and handed over the material to allies in the Congress who had parliamentary immunity. Castro's adversaries started a media campaign to discredit him.

According to Malaver, Halvorssen allegedly received US$ 7 million from the bank to demonstrate that Orlando Castro was a drug trafficker. According to Malaver the accusation of drug trafficking against Orlando Castro was false.

Charles Intriago—a Miami lawyer and former federal prosecutor, as well as editor of Money Laundering Alert and the well-known host of a biennial national money-laundering conference that attracts justice and law enforcement authorities, came to Castro Llanes’ defense and countered that Halvorssen ran a "smear campaign" and fed lies to US officials. It was later disclosed that Money Laundering Alert had received its seed money from Castro. Intriago's activities came under investigation of the House Government Reform Committee where he repeatedly pled the Fifth Amendment when asked about his involvement with Castro and his own illegal campaign contributions to the re-election campaign of President Bill Clinton. Despite Malaver and Intriago's claims that Castro was an honest businessman being smeared by Halvorssen, Castro was convicted and sentenced to prison in 1997. After completing his sentence Castro was extradited to Venezuela to stand trial for bank fraud. He was convicted and sent to El Junquito prison.

Halvorssen became entangled in a turf war between the CIA and DEA and lost backing of both the agencies when he said Guillen was innocent. According to the former head of an intelligence unit who worked with both the DEA and the CIA: "what happened to Halvorssen was the result of a collision of some mighty forces. He thought he was enough of a fancy dancer to play games with the big boys and get away with it. Nobody is wearing white hats in this one. I would bet the DEA put some pressure on Orlando Castro to get himself an inside track into Banco de Venezuela. For some reason – most likely it had used the bank in the past or was still using it for some covert funny business – the CIA didn’t want that to happen. So both agencies were trying to squeeze each other out, but Halvorssen was in the middle and got his testicles caught in the wringer."