Venezuela authorities raid biggest brokerage

* Government has taken control of forex trading

* Chavez threatens to widen crackdown on brokers

By Enrique Andres Pretel

CARACAS, May 24 (BestGrowthStock) – Venezuelan authorities raided
the country’s biggest private currency brokerage on Monday in
the latest in a string of operations since the government took
control of all forex exchanges last week.

President Hugo Chavez has vowed to widen a crackdown on
private brokerages that had been taking part in an unofficial
“parallel” market that provided dollars for half of all imports
and where the local bolivar plunged this year. [ID:nN20188931]

Officials targeted Econoinvest on Monday, a major brokerage
which has been operating in the capital Caracas for 14 years
and says it has more than 40,000 clients.

“The Public Ministry coordinated and supervised the raid
… which was launched following a complaint about alleged
irregularities by corporations and individuals in the brokering
of foreign exchange,” the government said in a statement.

Eighteen brokerages have now been raided and four directors
arrested since last week when the government put the central
bank in sole charge of all foreign exchange deals.

The bank says a new system will be set up within two weeks,
and that it will use the OPEC member’s internationally traded
bonds to set a price band for the bolivar.

The country’s economic woes and electricity shortages are
denting Chavez’s popularity and could give the opposition a
boost ahead of legislative elections due in September that are
being seen as a curtainraiser for a presidential vote.

Investing Advice
(Editing by Daniel Wallis and Richard Chang)

Venezuela authorities raid biggest brokerage