It was just before Thanksgiving 2017, and a number of executives of Citgo, the American subsidiary of PDVSA, the Venezuelan state oil company, were called on only 12 hours notice to appear at a corporate meeting in Caracas.
The six — Gustavo Cárdenas, Tomeu Vadell, Jose Luis Zambrano, Alirio Zambrano, Jorge Toledo, and Jose Pereira — did not come home for Thanksgiving. Nor did they return to their families for Christmas. Nor in 2018.
In fact, the six were sentenced in a kangaroo court to prison terms from eight to 13 years, and for five long years they languished in a dungeon, getting only two hours of fresh air per day and enduring forced nudity, physical abuse, starvation, and deprivation of water and sunlight. Their emaciated condition soon alarmed their panicked families — Vadell lost more than 70 pounds — and not until March of 2022 was Cárdenas released, with the other five allowed to return home in October of that year.
Their families did not recognize them when they arrived back in Houston.
The executives were freed as part of a prisoner swap; the Biden administration granted clemency for Franqui Flores and his cousin Efrain Campo, two men arrested in Haiti in a Drug Enforcement Administration sting in 2015 and convicted the following year in New York. Flores and Campo were significant enough to trade for the Citgo Six because they were nephews of “First Combatant” Cilia Flores.
The Citgo Six, as they became known, have a story that is about as emblematic as any of the rancid and utterly villainous nature of the communist regime in Venezuela that is now swaying to and fro in the aftermath of the capture of its dictator, Nicolas Maduro, and the First Combatant — the title Maduro gave his wife.
The Zambrano brothers filed a $400 million lawsuit against Citgo in Harris County District Court in Texas in May of 2024. That came months after Vadell filed his own $100 million suit in March of 2023. Information from those filings, the company’s response, and contemporary news reports tells a story of evil, corruption, and corporate cowardice.
By 2017, PDVSA had declined from producing nearly four million barrels of oil per day 30 years earlier to less than half that amount, and the creditors had begun circling. Trish Whitcomb of the Juris Journal Substack blog sets the scene:
The petition names Guillermo Blanco as the central figure. Blanco was a Venezuelan military officer who participated in the failed 1992 coup alongside Hugo Chavez. In January 2017, Maduro appointed him VP of Refining for PDVSA. He simultaneously served as chairman of the boards of Citgo Petroleum, Citgo Holding, and PDV Holding. All three defendants in this lawsuit.
By November 2017, PDVSA was in selective default. Creditors were circling Citgo. Losing the Houston refiner would have been a political disaster for Maduro, evidence he could not manage the country’s finances or protect its assets. The petition alleges the regime launched a purge to find scapegoats. By mid-November, according to the petition, more than 60 PDVSA employees had been arrested as part of that purge.
The petition quotes what it describes as Blanco’s August 5, 2017, social media post: “We must purge PDVSA and all the government ministries of escuálidos.” The plaintiffs characterize the term as a slur the Chavez government used for political opponents.
The petition also names Calixto Ortega Sanchez, Citgo’s VP of Finance. Ortega Sanchez’s uncle was a Venezuelan Supreme Court justice sanctioned by the U.S. government in 2020. The petition alleges Ortega Sanchez provided confidential financial documents to DGCIM, Venezuela’s military counterintelligence service, enabling the fabricated charges against the Citgo 6.
Ortega Sanchez was present at the PDVSA meeting on November 21, 2017, when masked agents arrested the executives. He was not detained. By 2018, the U.S. had barred him from reentering the country. He went on to become president of the Central Bank of Venezuela.
Reports after the fact alleged that the Citgo Six had been arrested on charges of “corruption.” But per the petition, and the statement has not been challenged, the executives were charged specifically with signing unauthorized refinancing agreements — $4 billion in bonds — that would have pledged Citgo as collateral. Venezuelan Attorney General Tarek William Saab announced the arrests the same day, accusing the men of negotiating with Apollo Global Management and Frontier Management Group under terms detrimental to PDVSA.
The Zambranos note that neither had anything to do with corporate finance.
Citgo’s statements in response to the lawsuits were eye-opening. Denying any liability and casting itself as a fellow victim, Citgo said the six executives had been denied due process, confirmed the charges were meritless, and said “The Citgo 6 were our senior-most executives, and neither they nor Citgo, the company they led, are responsible for the arbitrary acts of [President Nicolás] Maduro’s repressive regime.”
Citgo is still owned by PDVSA, but the corporate relationship isn’t an active one. It couldn’t be. In 2019, the U.S. federal government imposed sanctions on Venezuelan oil and recognized opposition leader Juan Guaidó as Venezuela’s legitimate president. At that time, a new board was elected at Citgo and it continued operations.
Around that time, Citgo began paying something — though nothing like their salaries — to the families of the six executives and helping to defray their legal costs as they attempted to free the six in Venezuelan courts. Before then, they’d been placed on leaves of absence without pay.
The Vadell and Zambrano lawsuits against Citgo had little chance of netting much of the sought-for damages. Citgo is still seen as responsible for PDVSA’s American debt. In November of last year, a federal judge in Delaware approved the sale of Citgo’s parent company to Houston-based Amber Energy in a $5.9 billion transaction; Amber Energy is owned, at least in part, by the West Palm Beach-based hedge fund Elliott Investment Management.
But that sale was contested by the Maduro government, which appealed the judge’s decision. Now that there is no Maduro and his former vice president, Dulcy Rodriguez, who is now in charge of the regime, has pledged “collaboration” with the U.S. government, it’s a good bet Amber Energy will take control of Citgo.
And that might lead to some relief for the Citgo Six.
Except as Whitmore notes, they’re going to be in the back of a pretty long line — and she provides a couple of highlights:
Even if the Zambranos and Vadell prevail, collecting will be complicated. Citgo’s parent company owes creditors roughly $21 billion. ConocoPhillips alone is seeking more than $11 billion for assets Venezuela nationalized years ago. A Canadian mining company, Crystallex, won a judgment that helped trigger the sale process.
So when your Democrat friends thunder away at the Trump administration for their arrest of Maduro, and decry the “regime change” in Caracas on the theory that “it’s all about oil,” ask them if they’ve ever heard of the Citgo Six.
Then ask them if they’re OK with defending a regime that committed those grievous human rights abuses against Americans who worked for them. And ask them if making Gustavo Cárdenas, Tomeu Vadell, Jose Luis Zambrano, Alirio Zambrano, Jorge Toledo, and Jose Pereira whole — not to mention ExxonMobil and ConocoPhillips, who had billions stolen from them by the Chavez/Maduro criminal syndicate in Venezuela — might be worth a little bit of American involvement in that country’s oil industry.
READ MORE by Scott McKay:
The Toppling of Villains Has Begun in Earnest. It Must Continue.
On Venezuelan Oil Tankers, Chinese AI, and American Energy Traitors
Five Not-So Quick Things: The Green Shoots Which Will Only Get Greener
