WASHINGTON – A Venezuelan businessman yesterday defended his purchase of a U.S. manufacturer of touch-screen voting machines, saying his companies have no ties to Venezuelan President Hugo Chavez.
Antonio Mugica, dual-Spanish-Venezuelan citizen and CEO of Smartmatic Corp., denied that either Smartmatic or its subsidiary, Sequoia Voting Systems, Inc., was ever controlled or influenced by Chavez’s leftist government.
“We are definitely concerned about the allegations published which are utterly false,” Mugica said at a news briefing. “I haven’t met President Chavez. I look forward to the completion of a review by the U.S. government.”
“That’s how confident we are in the caliber of the people involved,” he said.
Smartmatic, based in Boca Raton, Fla., and Sequoia Voting, which makes voting machines in 16 states and the District of Columbia, on Sunday said they had asked the U.S. government to investigate their 1995 merger to dispel what they called baseless rumors of ties to Chavez.
The Committee on Foreign Investment in the United States, or CFIUS, had been reviewing the deal since the spring after Rep. Carolyn Maloney, D-N.Y., called for an investigation, citing a risk to the integrity of U.S. elections.
“I am glad that our government will get the answers to any questions about this sale,” Maloney said in a statement yesterday. “This helps maintain confidence in our electoral system.”
Brookly McLaughlin, spokeswoman for the Treasury Department, which oversees the foreign investment committee, confirmed CFIUS has been in contact with Smartmatic. She declined to comment whether there was a formal investigation.
The probe comes after a political furor earlier this year over a buyout that put a Dubai company in control of some operations at six American ports. The outcry led the Dubai company, DP World, to promise it would sell the U.S. operations to an American company.
Yesterday, the companies and their lawyers sought to allay any voter concern about the security of Sequoia’s electronic voting machines in the Nov. 7 congressional elections. In recent months, activists have filed lawsuits in at least nine states questioning the security of electronic machines in general.
“Sequoia only provides the machines. It does not run elections – state and local officials do,” said Jeff Bialos, a Washington attorney representing Smartmatic and Sequoia. “There are a number of checks and balances in place to make sure the elections are secure and reliable.”
According to Smartmatic, the company is owned primarily by three individuals and their families: Mugica (78.8 percent); Alfredo Anzola (3.9 percent); and Roger Pinate (8.5 percent). Investor Jorge Massa as well as Smartmatic employees and other friends own the remainder.
Smartmatic was little known until Venezuelan authorities chose it to replace the Latin American country’s voting machines before an August 2004 referendum that confirmed Chavez as president.
Chavez is a longtime foe of the Bush administration. Last month, he called President Bush “the devil” in a speech at the United Nation, drawing prompt criticism from lawmakers from both U.S. parties.
With profits from the $100 million Venezuelan contract, Smartmatic was then able to purchase Oakland, Calif.-based Sequoia. It is now the leading provider of U.S. voting machines and is working aggressively to market its machines to other Latin American countries.
Yesterday, Mugica said his company joined with other American partners including Verizon Communications as part of consortium that won the Venezuelan contract in a competitive bidding process.
He said his company’s success was nothing unusual.
“We have the best technology. We put the best partners together. That’s what happens in the technology industry,” Mugica said.
