Panama’s financial and property sectors are once again under global attention. New findings show that the country has played a central role in moving billions of dollars linked to corruption cases from Venezuela.
Reports from anti-corruption groups reveal that at least 178 investigations in 30 different countries include companies registered in Panama. These cases involve an estimated $69 billion in suspicious money flows. That figure is equal to more than ten times Venezuela’s yearly economic output.
According to Mercedes De Freitas, executive director of Transparency Venezuela, the organisation has had access to about 60% of the case files. She noted that what is visible today may only represent a small fraction of the real picture.
The corruption schemes began about two decades ago. Signs first appeared around 2004, but the operations expanded sharply after 2012. Panama has been named as one of the key destinations, alongside other financial hubs like Hong Kong and Delaware.
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While Panama has often been seen as a financial center, it has also become a channel for money moving into property. Global transparency indexes place Panama among the most vulnerable countries for real estate money laundering.
Housing Market Distorted by Illicit Capital
The large inflow of Venezuelan money has had clear effects on Panama’s housing market. Real estate has been used as a safe space to store suspicious funds, driving up costs and fueling speculation.
De Freitas explained that this process has made housing less affordable for locals. Rising property prices, driven by illicit cash, have created bubbles in the market. Access to loans has also become more expensive, while criminal groups tied to corruption proceeds have expanded their presence in the country.
Olga de Obaldía, director of Fundación para la Libertad Ciudadana, stressed that such financial flows have worsened access to housing, increased credit costs, and supported the growth of organised groups.
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The impact has gone beyond economics. Former Transparency International president José Ugaz pointed out that corruption is not just about money, but also has consequences for human rights. With dozens of Venezuelan fugitives wanted abroad and Caracas refusing cooperation, other countries such as Panama have become vital for enforcement.
High-Profile Cases Show Panama’s Exposure
Several major investigations illustrate how Panama’s systems have been used. One case under judicial review involves All Bank, a financial group accused of defrauding thousands of depositors across Venezuelan and Caribbean banks. Another case, prosecuted in multiple countries including Panama, documented a scheme worth more than $1 billion tied to Venezuela’s state oil company PDVSA and politically connected contractors.
Further investigations describe how a Panamanian businessman worked with relatives of Venezuela’s first lady, Cilia Flores, to secure no-bid contracts for infrastructure and imports. Payments from these deals reportedly passed through banks linked to financier Víctor Vargas, several of which have since collapsed.
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Another scheme tied to Venezuela’s preferential dollar exchange system also ran through Panama. Colombian businessman Alex Saab, who is now Venezuela’s Minister of Industry, allegedly used the Colón Free Zone to structure part of these transactions.
Calls for Transparency and Stronger Controls
Although the names of the Panamanian companies under investigation remain confidential due to judicial restrictions, De Freitas argued that transparency in company ownership is key to closing loopholes.
Panama was recently removed from the European Union’s financial blacklist, a move welcomed by officials. But both De Freitas and Ugaz warned that the country remains vulnerable unless stronger controls are applied in banking and property, especially regarding politically exposed persons.
Ugaz noted that Panama’s independent judiciary and role as a financial hub give it both responsibility and opportunity. He argued that unless action is taken, illicit capitals will continue to distort the country’s economy.
Investigators from Transparency Venezuela have met with Panamanian authorities, offering databases, network analyses, and years of monitoring to support ongoing cases. The collaboration aims to prevent Panama from becoming further entangled in cross-border corruption networks.