Eric Zuesse -- No Longer Trust ‘Elections’ in ‘Democracies'

 No Longer Trust ‘Elections’ in ‘Democracies'

Eric Zuesse, November 27, 2020

A Wikileaked U.S. diplomatic cable from the Embassy in Venezuela in 2006 includes allegations which suggest that any system of electoral vote-counting which relies upon anything other than recountable and physically stored paper ballots which were produced under the continuous simultaneous supervision of all Parties that are listed on the ballot should not be trusted, and this would basically exclude from being trustworthy all electoral systems which rely upon electronically recorded records.

This is a “CONFIDENTIAL” cable that was sent on 10 July 2006 by the U.S. Ambassador in Caracas Venezuela to 10 other embassies plus the EU plus U.S. SOUTHCOM (forces south of the U.S. border), plus the National Security Council inside the White House, plus the Vatican.

This cable, though it has been at Wikileaks ever since at least 27 July 2015 (and Wikileaks doesn’t indicate there the date when they first had published it), fortunately was recently discovered by Paul Craig Roberts, who published, from it, at his site, on November 20th, only an excerpt (which is the part that’s boldfaced here below), under the headline “Classified US Embassy Cable Proves Smartmatic’s Connection to Venezuela”, and he discussed that excerpt there, but the entire cable is crucially informative and deserves to be read; so, it will here be published complete, for the first time other than at Wikileaks itself. Unlike the Wikileaks publication of it, this republication of it is accompanied by links and explanations so that readers can more easily understand it and explore things in it such as the background and interconnections of key persons who are mentioned in it.

This will be the entire cable (without any added commentary), as published at least five years ago by Wikileaks — the only complete publication of it, other than that publication of it five years ago by Wikileaks. 

The cable is about Smartmatic Corporation, which in 2014 became subordinated to SGO, a newly created holding company which is a partnership between “Smartmatic’s CEO Antonio Mugica and British Lord Mark Malloch-Brown.” (Recently, on November 17th, Matthew Ehret headlined “Lord Malloch Brown Revealed: The British Hand Behind the Coup Shows Its Scales Again”.) 

The information in this cable is the type of information-release which governments that are dictatorial want their publics never to know, and therefore it might exemplify why the U.S. and UK Governments are determined to destroy the international champion of democracy, Julian Assange, who was responsible for its release in 2015 (which was shortly after Malloch-Brown teamed-up with Mugica), and whom they have imprisoned for over a decade awaiting trial, and who could quite possibly die in prison, maybe without even having ever been convicted of anything, at all, by the U.S. regime, the UK regime, or any other Government (dictatorial or otherwise).

A detailed 104-page legal case against Smartmatic was presented on November 25th regarding its use and outcome in the U.S. Presidential election in the U.S. state of Georgia, but might be ignored by the court because America’s media had already declared the winner of that contest in all states and refused to consider the possibility that any of the existing vote-counts had been based upon tampering (electronic or otherwise) with those counts of those alleged votes. Questioning whether the United States is a democracy is effectively forbidden in all major, and most minor, media in the U.S. 

Here is that cable:

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https://wikileaks.org/plusd/cables/06CARACAS2063_a.html

[first successful copy to web archive dot org: 27 July 2015:

http://web.archive.org/web/20150727064210/https://wikileaks.org/plusd/cables/06CARACAS2063_a.html]

CARACAS’ VIEW OF SMARTMATIC AND ITS VOTING MACHINES

Date: 2006 July 10, 18:01 (Monday) Canonical ID:06CARACAS2063_a

Original Classification:CONFIDENTIAL Current Classification:CONFIDENTIAL

Handling Restrictions-- Not Assigned --

Character Count:11682

Executive Order:-- Not Assigned -- Locator:TEXT ONLINE

TAGS:KDEM - Democratization | PGOV - Political Affairs--Government; Internal Governmental Affairs | PHUM - Political Affairs--Human Rights | VE - Venezuela Concepts:-- Not Assigned --

Enclosure:-- Not Assigned -- Type:TE - Telegram (cable)

Office Origin:-- N/A or Blank --

Office Action:-- N/A or Blank -- Archive Status:-- Not Assigned --

From: Venezuela Caracas Markings:-- Not Assigned --

To: Bolivia La Paz | Brazil Brasilia | Canada Ottawa | Colombia Bogotá | Cuba Havana | Ecuador Quito | Mexico Mexico City | National Security Council | Netherlands The Hague | Nicaragua Managua | Peru Lima | Philippines Manila | Secretary of State | Taiwan Taipei City | U.S. Mission to European Union (formerly EC) (Brussels) | United Nations (New York) | United States Southern Command (Miami) | Vatican Vatican City

Classified By: Robert Downes, Political Counselor, for Reason 1.4(b). 

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Summary 

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1. (C) The Venezuelan-owned Smartmatic Corporation is a riddle both in ownership and operation, complicated by the fact that its machines have overseen several landslide (and contested) victories by President Hugo Chavez and his supporters.  The electronic voting company went from a small technology startup to a market player in just a few years, catapulted by its participation in the August 2004 recall referendum.  Smartmatic has claimed to be of U.S. origin, but its true owners -- probably elite Venezuelans of several political strains -- remain hidden behind a web of holding companies in the Netherlands and Barbados.  The Smartmatic machines used in Venezuela are widely suspected of, though never proven conclusively to be, susceptible to fraud.  The company is thought to be backing out of Venezuelan electoral events, focusing now on other parts of world, including the United States via its subsidiary, Sequoia.  End Summary. 

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Who Owns Smartmatic? 

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2. (C) Smartmatic was founded in the late 90s by three Venezuelans, Antonio Mugica, Alberto Anzola, and Roger Pinate.  According to Mugica's conversations with poloffs [the Embassy’s political officers, who are generally CIA] in recent years, the three had developed a network capable of handling thousands of simultaneous inputs.  An early application was ATMs in Mexico, but the U.S. presidential election in 2000 led the group to consider electronic voting platforms.  The company formed the SBC consortium with Venezuelan telecom provider CANTV (at the time 28-percent owned by Verizon) and a software company called Bizta. Mugica said Smartmatic held 51-percent of the consortium, CANTV had 47 percent, and Bizta, 2 percent (ref a).  The latter, also owned by the Smartmatic owners, was denounced in June 2004 by the press for having received a US$200,000 equity investment from a Bolivarian Republic of Venezuela (BRV) joint venture fund called FONCREI; a Chavez campaign adviser was placed on the board as well.  Bizta reimbursed what it called the "loan" when it was made public and shed the Chavista board member. 

3. (C) Mugica has told Poloffs on several occasions that Anzola, Pinate, and he are the owners of Smartmatic, though they have a list of about 30 investors who remain anonymous. Jose Antonio Herrera, Anzola's father-in-law (and first cousin to Venezuelan Ambassador to the United States Bernardo Alvarez), told poloff in 2004 the silent partners were mainly upper class Venezuelans, some of whom were staunch Chavez opponents.  There were rumors, however, that Smartmatic’s early profits came from Venezuelan defense contracts supplied by then-Defense Minister Jose Vicente Rangel, whom Chavez later promoted to Vice President.  Perhaps coincidentally, the Vice President’s daughter, Gisela Rangel Avalos, was the head of the local corporate registry when Smartmatic was registered, which contributed to allegations of the Vice President's involvement.  These unconfirmed rumors also suggested that one-time Chavez political mentor Luis Miquilena was also a shareholder in the company. 

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Organized To Compete or Confuse? 

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4. (C) Mugica first approached the Embassy in 2004 when the company was bidding at the National Electoral Council (CNE) to provide a completely new electronic voting system.  Mugica pitched Smartmatic as a U.S. company registered in Delaware with offices in Boca Raton, Florida.  In fact, poloffs had several discussions with Mugica in the course of facilitating his L-1 inter-company transfer visa to work in the United States.  Mugica said the company’s corporate offices were in Boca Raton, but most of the research staff of some 70 employees remained in Caracas.  Smartmatic essentially purchased its electoral expertise by hiring veteran election observer AMCIT Jorge Tirado and his team of consultants. Tirado served as the interface between Smartmatic and the CNE for several elections. 

5. (C) In May 2006, Mugica told Poloff Smartmatic's corporate structure had changed (which had come out in press reports during 2005).  Mugica said that Smartmatic was now two different companies under a Dutch holding company.  U.S. setup was essentially the same, with Delaware registry and the Boca Raton accounting office overseeing U.S. operations. Smartmatic acquired the U.S voting machine company Sequoia Voting Systems on March 8, 2005, Mugica reported.  All U.S. election machinery is assembled in New York, he said.  Mugica noted that while their U.S. operations were important, more than half their sales were outside of Venezuela and the United States.  The other Smartmatic company was based in Bridgetown, Barbados, where Mugica said the international sales operation was located.  Most of the manufacturing for their electoral and other electronic machinery was done in China, Mugica said, with some component work also done in Taiwan.  Smartmatic also manufactures some items in Italy through the company Olivetti (which built the original Smartmatic machines for Venezuela).  The research and development shop was still located in Caracas, Mugica noted. 

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A Shadow of Fraud 

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6. (C) Of course, the Venezuelan opposition is convinced that the Smartmatic machines robbed them of victory in the August 2004 referendum.  Since then, there have been at least eight statistical analyses performed on the referendum results. Most of the studies cross-check the results with those of exit polls, the signature drives and previous election results.  One study obtained the data log from the CANTV network and supposedly proved that the Smartmatic machines were bi-directional and in fact showed irregularities in how they reported their results to the CNE central server during the referendum.  (Note:  The most suspicious data point in the Smartmatic system was that the machines contacted the server before printing their results, providing the opportunity, at least, to change the results and defeat the rudimentary checks set up by international observation missions.  Since August 2004, the CNE has not repeated this practice.)  These somewhat conspiratorial reports perhaps serve to breathe life into a defeated opposition, but have never proved conclusively the fraud (refs b and c). 

7. (C) The Smartmatic machines suffered a major blow, however, when in a test prior to the December 2005 National Assembly elections an opposition technician was able to defeat the machine's allegedly random storage protocols and, therefore, the secrecy of the vote.  The technician took advantage of the fact that the computerized machines used a Windows operating system.  A simple program downloaded from the Internet accessed underlying Windows files created “in order” as the machine processed Smartmatic’s “randomizing” software.  Although Smartmatic officials argued convincingly that such controlled results could not be feasibly replicated during a real election (ref d), the opposition parties boycotted.  Abstention rates soared to at least 75 percent and confidence in the CNE among opposition voters plummeted. The disastrous results left Chavez with 100-percent control of the National Assembly, an albatross around the neck of a leader trying to appear democratic. 

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At Least Corruption 

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8. (C) If Smartmatic can escape the fraud allegation, there is still a corruption question.  Well before Smartmatic, Venezuelan law had dictated that voting ought to be automated to limit fraud -- the U.S. company ES&S and Spanish firm Indra had already sold systems to the electoral body.  When the new pro-Chavez CNE was named in September 2003, however, it immediately set out to replace all existing systems. 

Declaring the bid process to be an emergency (though there was as yet no referendum scheduled), the CNE bypassed normal procedures and initiated a closed bid process.  Smartmatic won the contract, which totaled at least US$128 million, including the delivery of 20,000 touch-screen voting machines (re-engineered lottery machines) yet to be built.  There were immediate questions about how a virtually unknown company with no electoral experience could have landed such a large contract.  Mugica asserted to poloff that everything was above board, though he conceded the company may have opened itself up to criticism by hiring a former interior vice minister named Morris Loyo to lobby the government.  There were additional allegations of impropriety in October 2005 when the press reported that Smartmatic had paid the bill of CNE President Jorge Rodriguez at an exclusive Boca Raton resort.  The company claimed Rodriguez had reimbursed them for the stay, during which Rodriguez reportedly examined an unspecified electoral system Smartmatic was developing. There were subsequent, unconfirmed rumors that Rodriguez was lobbying for Smartmatic in other countries. 

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Moving On From Venezuela? 

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9. (C) In December 2005, Mugica told emboffs [Embassy officials] the company was considering terminating its business with the CNE. Allegations of fraud were hurting the company's image, he said.  (Note:  Prior to that meeting, Mugica had agreed to loan a voting machine to the Embassy for examination.  When emboffs arrived at the office, however, Mugica said he had changed his mind and instead suggested that we contact Smartmatic’s Boca Raton office to secure a test machine.) Mugica noted that the CNE had purchased the software necessary to operate the machines without his company -- part of the CNE’s stated goal of achieving “technological independence” -- though he noted the CNE regularly holds out until the last minute before hiring them to administer an election.  He listed several countries in Latin America where they had either started supplying machines or were pushing for sales.  In December, Mugica told Polcouns [the Embassy’s Counselor for Political Affairs] the company is trying to break into Europe and Asia (he mentioned having sales agents in Thailand, Malaysia and the Philippines), they had yet to secure any sales.  Of course, via Sequoia, Smartmatic is already working in a dozen U.S. states. 

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Comment 

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10. (C) Smartmatic is a riddle.  The company came out of nowhere to snatch a multi-million dollar contract in an electoral process that ultimately reaffirmed Chavez' mandate and all-but destroyed his political opposition.  The perspective we have here, after several discussions with Smartmatic, is that the company is de facto Venezuelan and operated by Venezuelans.  The identity of Smartmatic’s true owners remains a mystery.  Our best guess is that there are probably several well-known Venezuelan businessmen backing the company who prefer anonymity either because of their political affiliation or, perhaps, because they manage the interests of senior Venezuelan government officials. 

BROWNFIELD

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Investigative historian Eric Zuesse is the author, most recently, of  They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010, and of  CHRIST’S VENTRILOQUISTS: The Event that Created Christianity.