Venezuelan opposition condemns Goldman for $2.8 billion bond deal

Wed May 31, 2017 8:00am EDT
 
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Brian Ellsworth and Davide Scigliuzzo

CARACAS/NEW YORK (Reuters/IFR) - Goldman Sachs Group Inc's statement that it never transacted directly with the government of Venezuelan President Nicolas Maduro when it bought $2.8 billion of bonds for pennies on the dollar was dismissed by the country's opposition on Tuesday as an effort to "put lipstick on this pig."

Goldman, in a statement late Monday confirming the purchase, said its asset-management arm acquired the bonds "on the secondary market from a broker and did not interact with the Venezuelan government." (A look into Venezuela's economic crisis here)

The New York-based investment bank came under fire from Venezuelan politicians and protesters in New York opposed to Maduro, who said the deal provided the cash-strapped government hundreds of millions of dollars in badly-needed hard currency. The deal, first reported by the Wall Street Journal, made Goldman complicit in alleged human rights abuses under the government, they said.

"As hard as it may try, Goldman Sachs ... cannot put lipstick on this pig of a deal for Venezuelans," the head of the opposition-led congress Julio Borges said.

Goldman Sachs did not respond to an email requesting comment on Borges' statement. In its original statement, Goldman had said: "We recognize that the situation is complex and evolving and that Venezuela is in crisis. We agree that life there has to get better, and we made the investment in part because we believe it will."

The opposition-led National Assembly later on Tuesday voted to ask the U.S. Congress to investigate the deal, which they called immoral, opaque, and hypocritical given the socialist government's anti-Wall Street rhetoric.

Goldman shares fell nearly 2 percent on Tuesday and were the biggest drag on the Dow Jones Industrial Average, which fell 0.24 percent.

"31 CENTS ON THE DOLLAR"   Continued...

 
Protesters demonstrate outside of Goldman Sachs headquarters after the company purchased Venezuelan bonds in New York. REUTERS/Lucas Jackson