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At PDVSA, the costs of corruption extend to bond swaps

Tom Fox | October 11, 2016

The costs of corruption are well-known and well-documented across the globe. Companies that engage in bribery and corruption are subject to fines and penalties under such anti-corruption laws as the U.S. Foreign Corrupt Practices Act and the U.K. Bribery Act. Individuals who accept bribes can be prosecuted under the U.K. Bribery Act and for money-laundering under U.S. law. Government officials can have their ill-gotten gains sized under the US Kleptocracy Act and other laws requiring forfeiture and return of assets.

However we are currently seeing another cost of corruption played out involving Venezuela and its national energy company, Petróleos de Venezuela (PDVSA). This summer, the company had attempted to swap out debts to prevent a potential default on outstanding obligations. The proposal, reported by Bloomberg, had entailed swapping $...

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