- The greater threat to our nation's security
comes not from Dubai and its pro-Western government, but from Venezuela,
where software engineers with links to the leftist, anti-American regime
of Hugo Chávez are programming electronic voting machines that will
soon power U.S. elections.
- Congress spent two weeks overreacting
to news that Dubai Ports World would operate several American ports, including
Miami's, but a better target for their hysteria would be the acquisition
by Smartmatic International of California-based Sequoia Voting Systems,
whose machines serve millions of U.S. voters. That Smartmatic -- which
has been accused by Venezuela's opposition of helping Chávez rig
elections in his favor -- now controls a major U.S. e-voting firm should
give pause to anybody who thinks that replacing our antiquated butterfly
ballots and hanging chads will restore Americans' faith in our electoral
- Consider the lack of confidence Venezuelans
have in their voting system. Anti-Chávez groups have such little
faith in Smartmatic's machines that they refuse to run candidates in elections
anymore as reports surface of fraud and irregularities from Chávez's
2004 victory in a recall referendum. Yet somehow Smartmatic International
and its Venezuelan owners were able to purchase Sequoia last year without
the deal receiving any scrutiny from federal regulators -- including the
Treasury Department's Committee on Foreign Investments in the United States
(CFIUS), which is tasked with determining whether foreign takeovers pose
- CFIUS generally investigates such transactions
only when the parties voluntarily submit themselves to review -- which
Smartmatic did not do. But it retains the authority to initiate an investigation
when it suspects a takeover compromises national security.
- Smartmatic has a brief but controversial
history. The company was started in Caracas during the late 1990s by engineers
Antonio Mugica and Alfredo Anzola. They worked out of downtown Caracas
providing small-scale technology services to Latin American banks. Despite
having no election experience, the tiny company rocketed from obscurity
in 2004 after it was awarded a $100 million contract by the Chávez-dominated
National Electoral Council to replace Venezuela's electronic voting machines
for the recall vote.
- When the council announced the deal,
it disingenuously described Smartmatic as a Florida company, though Smartmatic's
main operations were in Caracas and the firm had incorporated only a small
office in Boca Raton. It then emerged that Smartmatic's ''partner'' in
the deal, Bizta Corp., also directed by Anzola and Mugica, was partly owned
by the Venezuelan government through a series of intermediary shell corporations.
Venezuela initially denied its investment but eventually sold its stake.
- When the vote finally came, exit polls
by New York's Penn, Schoen & Berland Associates showed Chávez
had been defeated 59 to 41 percent; however, when official tallies were
announced, the numbers flipped to 58-42 in favor of Chávez. Venezuela's
electoral council briefly posted machine-by-machine tallies on the Internet
but removed them as mathematicians from MIT, Harvard and other universities
began questioning suspicious patterns in the results.
- Flush with cash from its Venezuelan
adventures, Smartmatic International incorporated in Delaware last year
and purchased Sequoia, announcing the deal as a merger between two U.S.
- Smartmatic says the recall vote was
clean and that it is independent of the Chávez government. Responding
to my inquiries, Smartmatic-Sequoias sent a written statement: ``Sequoia's
products consist only of voting devices and systems, all of which must
be federally and state tested and certified prior to use in an election.
As Sequoia's products do not have military, defense or national security
applications, they do not fall within the parameters of the matters governed
- In fact, Smartmatic International is
owned by a Netherlands corporation, which is in turn owned by a Curacao
corporation, which is in turn held by a number of Curacao trusts controlled
by proxy holders who represent unnamed investors, almost certainly among
them Venezuelans Mugica and Anzola and possibly others.
- Why Smartmatic has chosen yet again
to abuse the corporate form apparently to conceal the nationality and identity
of its true owners is a question that should worry anyone who votes using
one of its machines. Congress panicked upon hearing that our ports would
be run by an American ally, Dubai, but never asked whether America's actual
enemies in Venezuela have been able to acquire influence in our electoral
- Richard Brand is a second-year law student
at New York University and a former staff writer for The Miami Herald.