It is certainly one thing to fear arrest for violating criminal laws prohibiting bribery and corruption, such as the FCPA. Now the Venezuelan government has opened up a new level of fear for officers, directors, and even employees of the U.S.-based company Citgo Petroleum Co., as it has been reported that six top company officials were detained last week while at business meetings in Venezuela. Although a Houston-TX based company, Citgo Petroleum is a subsidiary of the Venezuelan state-owned oil company Petróleos de Venezuela SA (PdVSA). Those detained were the acting president of the company and five members of the company’s board. Their alleged crime was offering bonds to finance the company’s continued operations.

Interestingly, no formal charges have yet been brought against the individuals. It is also unclear if the U.S. Embassy’s request for access to the six, who are all U.S. citizens, was granted. The Venezuelan Attorney General Tarek Saab said the acting president and five board members of the subsidiary, “tried to defraud the nation through a planned $4 billion financing deal with three little-known foreign investment funds.” While a large number of PdVSA officials have been arrested in corruption probes, this is the first-time individuals with Citgo have been arrested. It is also the first-time U.S. citizens have been arrested by Venezuelan officials for corruption, although the United States has prosecuted multiple U.S. and Venezuelan persons for corruption involving PdVSA.

These detentions open a new and potentially damaging situation for Citgo. The company has to-date evaded U.S. sanctions that were levied on Venezuela more generally and PdVSA as well. This action by Venezuelan officials will no doubt drive all significant Citgo decision making toward PdVSA and in turn make it more clear to U.S. officials that Citgo is simply another arm of the Venezuelan government, potentially leading to sanctions against Citgo directly. If your company is doing business with Citgo, you need to review all your relationships, contracts, payment status, and all other facets of the commercial relationship NOW. You might also channel your inner Bette Davis and buckle up as its going to be a bumpy ride going forward.