The CEO of fintech Wenance, Alejandro Muszakhe intended that his business in Uruguay was an island and that it was not affected by the operation in Argentina. On July 9, 2023, his phone didn’t stop ringing after Infobae reported that the technology company dedicated to credit online for consumption recognized that was rescheduling interest payments. Wenance was accused of fraud and its main executive sought to prevent the news from having an effect in Uruguay.
His wish was impossible. Perhaps due to the closeness between the two countries, the news of the default had a immediate impact on the other side of the Río de la Plata and Uruguayan investors also communicated with requests for explanations. Later, the Argentine businessman was also denounced in Uruguay by about 600 people who They say they have been scammed out of USD 20 million.
The complaint led to an investigation by the Prosecutor’s Office, which is coming to an end, as reported this Wednesday. The Observer. The Economic Crimes Prosecutor, Gilberto Rodriguez, verified the departure of the money from Wenance Uruguay to Wenance Argentina, which constitutes the crime of misappropriation.
In Uruguay, Wenance granted loans through Welp with very low requirements. It also provided loans for conventional purchases of household appliances and, mainly, to purchase motorcycles.
The loans were financed by investors who were the ones who asked for explanations when the crisis exploded in Argentina. They placed their money and in return received a portfolio of clients. In theory, they charged according to their profits for the payment of debtors’ interests. The profitability, therefore, had to be variable, but Wenance paid a fixed rate.
The prosecutor also understands that there was a scam because investors were attracted to invest based on conditions that were not real and that other data such as the real default rate were disguised. Rodríguez also considers that there is a crime of money launderingwhich understands that it was committed from the moment they appropriated the money invested and disposed of it in other companies.
The Prosecutor’s Office understands that it has all the evidence to argue that these three crimes existed and, therefore, is preparing to request the extradition of Muszak and some of his collaborators. This was communicated by the prosecutor to some of the complaining lawyers, according to information from the Uruguayan newspaper.
For the prosecutor, it was demonstrated that local workers had “no control or direction of the company” and they indicated that all decision-making power was in Argentina. For this reason, the Prosecutor’s Office intends for the owners of the company to appear before the Uruguayan Justice.
The CEO of the fintech and other executives are imprisoned in Argentina, so they could only be transferred to Uruguay once their sentences are served.. His lawyer in Uruguay, Jorge Barrera, resigned from his defense.
In the document presented to the Court, the complainants affirm that andMuszak’s business model ended up resulting in a “real Ponzi scheme” or a “pyramid scam”they add. And they explain it: current investments were used to pay old returns and then future investments would serve to cover the interests of current ones.
Before testifying in Uruguay, Muszak tried to reach an agreement with the country’s investors. Even his then-lawyer raised it at the hearing. “Are you all in the conversation groups with Muszak?” he asked them, when the possibilities of reaching an agreement were still real. But, at that time, there were still some episodes missing from that story, which would end up frustrating the negotiations. A group of investors appeared before the bankruptcy court and a judge designated that the Commercial Defense League intervenes as co-administrator of the company.
