Venezuela Accuses Website of Cyberterrorism | Courthouse News Service
Thursday, November 30, 2023
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Venezuela Accuses Website of Cyberterrorism

(CN) - Venezuela's central bank claims a website run by exiles is committing cyberterrorism by reporting a fraudulent bolivar-to-dollar exchange rate to destabilize the country's economy.

Banco Central de Venezuela sued DolarToday LLC, Gustavo Vivas, Ivan Lozada-Salas, and Jose Lozada in Delaware federal court on October 23.

"How far will some go to enrich themselves (and their friends) and to regain the political power they crave to enrich themselves further? Would they go so far as to hurt their own countrymen by making their already challenging lives even harder? Defendants would. And they have," the complaint begins.

Defendants are Venezuelan nationals currently living in the U.S. who oppose the nation's current government. According to the complaint, the three individual defendants participated in a failed coup in 2002, and thereafter fled to the states.

In order to destabilize the current Venezuelan regime and advance their own political goals, defendants have allegedly engaged in a massive scheme to manipulate the Venezuelan currency.

"In a ruthless exercise of realpolitik, defendants seek to trick the Venezuelan populace that elected the Republic's current government, hoping that voters will turn on their leaders, and blame them for the harm caused by defendants," the bank claims.

On Monday, the Venezuelan Bolivar was officially trading at a rate of 1 Bolivar equalling about 16 U.S. cents.

DolarToday is a website that tracks the exchange value of the Bolivar on the black market, which many perceive as being a more accurate valuation than the government-controlled exchange rate.

On Monday, DolarToday listed the exchange rate at about four times the official rate. According to the website's figures, the Bolivar is suffering extremely high inflation, and has lost 90 percent of its value during the past year.

The bank describes DolarToday's operation as "a form of cyber-terrorism to wreak, and in fact they have wreaked, economic and reputational harm on the Central Bank by impeding its ability to manage the Republic's economy and foreign exchange system."

It says the website has deprived the country of investment, and created the false impression that the bank is incapable of managing Venezuela's economy.

Approximately one million people per day visit DolarToday's website, and it has $1.5 million Twitter followers. Its mobile app is one of the most frequently downloaded apps in Venezuela.

"The bloated DolarToday rate does not reflect any genuine and dramatic structural shift in the Venezuelan economy," the bank claims. "Instead, the Central Bank is informed and believes that in or about May 2013 - after defendants had established the daily DT Rate as 'the' authoritative unofficial bolívar-dollar exchange rate - they agreed and conspired to deliberately manipulate the DT Rate while at least some of the Defendants began trading in black markets for currency futures for their personal financial gain and at the expense of the Central Bank - as well as the Venezuelan public."

The complaint continues: "Put another way, defendants are not reporting on a market. Rather, by posting an artificial DT Rate daily, defendants are deliberately misrepresenting and effectively manufacturing a market - a phony, distorted market for the exchange of bolívares into dollars and vice-versa, with the aim of lining their pockets with ill-gotten gains." (Emphasis in original.)

The bank seeks an injunction prohibiting DolarToday from publishing a fraudulent exchange rate, and punitive damages for racketeering, false advertising, and unjust enrichment. It is represented by Jack Blumenfled with Morris, Nichols, Arsht & Tunnell in Wilmington, Delaware.

Representatives of DolarToday were not immediately available for comment.

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