Ex-Bank CEO Sentenced for Fraud and Sanctions Evasion

Sentencing of Tomás Niembro Concha

Tomás Niembro Concha, former CEO of Nodus International Bank, received a 112-month prison sentence for orchestrating a multimillion-dollar fraud and evading U.S. sanctions against Venezuela. Niembro, a dual citizen of Spain and Venezuela, led Nodus International Bank, headquartered in Puerto Rico and favored by Venezuelans, especially in South Florida. U.S. District Judge Kathleen M. Williams ordered Niembro to also forfeit over $16.9 million obtained through fraudulent activities.

Bank Collapse and Financial Fallout

Nodus collapsed in 2023, stranding around $80 million in deposits and affecting hundreds of clients, including Venezuelans in South Florida. The bank had been founded in San Juan in 2009 and was mainly operated by Venezuelans. Its downfall caused uncertainty among its clients, who had few alternatives due to increasing U.S. sanctions on Venezuela that discouraged other banks from serving Venezuelan customers.

Niembro’s Fraudulent Activities

Niembro and Juan Francisco Ramirez, former Chairman of Nodus, conspired to defraud the bank by channeling millions through Miami firms. They managed to invest $11 million from Nodus into a Miami lender, ultimately loaning the funds back to themselves for personal benefit. Through Nodus Finance, a Miami company they co-owned, they extracted additional millions.

Niembro admitted to conspiracy to commit wire fraud and conspiracy to violate the International Emergency Economic Powers Act. Ramirez also pleaded guilty, agreeing to forfeit at least $13.6 million. He is yet to be sentenced, but has cooperated with prosecutors, potentially affecting his sentence.

Sanctions Evasion Scheme

In addition to fraud, Niembro evaded U.S. sanctions on Venezuela. Prosecutors disclosed that between 2021 and 2023, Niembro schemed to perform unauthorized financial transactions with an individual under U.S. sanction for supporting Venezuela’s state-owned oil entity, Petróleos de Venezuela (PDVSA). Although Nodus secured permission from OFAC to foreclose on a property linked to the sanctioned person, Niembro secretly planned to sell it back through a front company, violating U.S. sanctions.

Impact on Nodus Customers

The criminal actions led to severe consequences for Nodus customers, particularly when the bank entered a liquidation process in March 2023. Depositors, including Venezuelan businesswoman Adelaida Cedeño, experienced significant losses. Cedeño had $35,000 trapped in the bank, impacting her trade business and assets.

Regulatory Response and Liquidation

In late 2022, the Treasury Department found Nodus violated U.S. sanctions related to Venezuela. This prompted Puerto Rico’s financial regulators to oversee the bank’s liquidation. They identified inconsistent payments to directors and shareholders and other transactions exhibiting conflicts of interest and financial instability at Nodus. As the situation unfolded, attorneys warned that depositors might recover only a fraction of their funds.