Venezuelan government officials and some Mexican companies have conspired to inflate prices for basic food aid packages. The food packages, known as “CLAP” packages (standing for Local Committees of Supply and Production), are supposedly subsidised food packages provided by the Venezuelan government.
The Venezuelan government is providing the packages to families so that a basic level of subsistence can be maintained during hyperinflation and an economic meltdown.
Mexican prosecutors revealed the findings of an investigation into the aid packages on October 18th. In short, the investigation found there was a conspiracy to overcharge for the aid packages. Venezuelan officials, working together with some Mexican businessmen, would purchase poor quality items in bulk. These items would then be exported to Venezuela at more than double their real price.
Mexico's top organised crime prosecutor, Israel Lira, said the suspects have agreed to pay $3-million in reparations to the UN refugee agency. This money will then be used by the organisation to fund Latin America operations. The agency is currently focused on helping Colombia to resettle hundreds of thousands of Venezuelans, who are fleeing the humanitarian crisis.
Prosecutors located some 1,300 shipping containers filled with 1.8 million packages. The packages were allowed to continue to Venezuela so that the recipients of the aid would not be negatively affected by the scheme.
However, this is not the first such scandal.
The US Treasury Department has also released a list of suspected shell companies which they believe are being used by senior Venezuelan officials. It is believed some Venezuelan officials are siphoning off millions of dollars from food import contracts.
Financial forensic investigators from the US and three conservative Latin American allies. Mexico, Panama and Colombia, traced transactions by companies believed to be controlled by a government-connected businessman.
The CLAP programme has become a tenuous lifeline for millions of Venezuelans. The citizens are suffering from empty grocery shelves, the result of an annual inflation rate estimated by the International Monetary Fund as about to reach one million%.
Critics within the country have said President Nicolas Maduro has essentially weaponised food, as the aid gets distributed mainly to government workers and supporters. The boxes contain items like cooking oil, flour, rice and canned tuna.
Much of the food comes from Mexico and there have been complaints about the quality. A study found that the powdered milk distributed in CLAP boxes regularly contained a third of government-mandated protein levels and twice the level of recommended carbohydrates.
Just three days before Maduro was re-elected, Columbian officials said they had intercepted and subsequently seized, 15 shipping containers filled with spoiled food. The containers had more than 25,000 CLAP boxes. According to AP, officials found beetles in the rice, among other health concerns.