Venezuela takes charge of big bank, arrests 11 executives

Venezuela arrested 11 top officials from the country's largest private bank and announced that the state would intervene in the institution's activities at least temporarily to clean up purported illicit activity, officials said Thursday.

It was not clear whether the 90-day intervention would be a first step toward a full takeover of Banesco. It's the second round of arrests recently at a private interest following the detention of two Chevron employees.

Attorney General Tarek William Saab in a state TV broadcast announced that the Banesco executives had been detained following a "surgical" probe uncovering "irregularities" that devalued Venezuela's flagging currency.

Critics of President Nicolas Maduro's socialist government point to the administration's own missteps for the country's spiraling quadruple digit inflation, making common goods too expensive for most residents.

Hours after the arrests, the government released a statement announcing its intervention into Banesco aimed at redirecting its administration and purging the bank, while putting a deputy finance minister at its helm.

Officials have previously accused criminal networks of smuggling Venezuelan bolivars across the border to manipulate the black market exchange rate. Investigators said they linked a large number of suspect Banesco accounts with addresses in Colombia and Panama.

Banesco's executive president Oscar Doval Garcia was among those arrested.

Juan Carlos Escotet, president of Banesco International, denounced the government action as "disproportionate" from a meeting in Portugal. He was not among those detained and said he was planning his immediate return to Venezuela.

"I will go to Venezuela with peace of mind to support my colleagues," he said on Twitter, adding that his bank follows all regulations. "I put myself at the service of the government with the confidence that everything will be clarified."

The arrests are part of an operation to take down an alleged international network accused of manipulating the black market exchange rate, which values $1 at more than 10 times Venezuela's official exchange rate.

The operation has netted 134 arrests and led to 1,380 frozen bank accounts, the majority belonging to Banesco.

The bank executives' detention follows the arrest in April of two Chevron Corp. employees based in Venezuela in what appeared to be the first such detentions of a private oil company's workers amid a growing anti-corruption purge.