Founding
In 1997,
[8] three Venezuelan engineers, Antonio Mugica, Alfredo José Anzola and Roger Piñate, began collaborating in a group – which would later become Smartmatic – meeting in a "tiny office" in
Caracas, Venezuela while working at Panagroup Corp.
[9][10][11][12][13] Mugica, who was director of the Panagroup Corp.,
[14] led the group to use "the research and development department of Panagroup Corp." in Venezuela,
[10] with the trio eventually creating a system where thousands of inputs could be placed into a network simultaneously.
[13] On November 12, 1997, Mugica and his father founded Software Softer, C.A. in Caracas, Venezuela.
[15]
Following the
2000 United States presidential election, the group proposed to dedicate the system toward electoral functions.
[13] After receiving funds "from private investors"
[11] which included
Jorge Massa Dustou,
[16] one of the richest individuals in Venezuela,
[17] the company then began to expand rapidly. Smartmatic was officially incorporated on 11 April 2000 in
Delaware by Alfredo José Anzola,
[18][19][20] with Anzola later incorporating Bizta Corporation the following day on 12 April 2000.
[21][22] Smartmatic then established its headquarters in
Boca Raton, Florida with only seven employees.
[11][12] On 22 June 2001, Mugica's company in Venezuela, Software Softer, C.A., was renamed Bizta R&D Software, C.A.,
[23][24] with the company later dividing its shares and splitting the ownership between Antonio Mugica R., Antonio Mugica S., Eduardo Correia and Alfredo Anzola.
[25]
First election
In 2003, Bizta was losing money with "barely a sales deal to its name".[26][27][28][29] It was at this time that Bizta was awarded a $150,000 "loan" from Marieta Maarroui de Bolívar – wife of the then-Chavista governor Didalco Bolívar – who was president of FONCREI, the Venezuelan government's organization dedicated to industrial funding.[26][30] Smartmatic also received an additional $200,000 loan from the Chávez government.[31] Smartmatic later responded to the bid process initiated by the CNE for the 2004 Venezuela recall, forming the SBC Consortium in the third quarter of 2003, prior to bidding. The SBC Consortium comprised Smartmatic, Bizta, and Venezuela's state-run telecommunications organization CANTV.[11][13] The SBC Consortium deal was notarized by then-Vice President José Vicente Rangel's daughter Gisela Rangel de D'Armas in Caracas.[14][31] The deal with Bizta required the Venezuelan government to own 28% of Smartmatic and placed Venezuela's Head of the Council of Ministers and advisor to Hugo Chávez,[32] Omar Montilla, on Smartmatic's board of directors.[28] Montilla was also appointed director of Bizta on 15 December 2003.[33]
After it was reported that the Venezuelan government had been involved with funding and managing Mugica's Bizta for over two years, Smartmatic quickly repaid Bizta's "loan" a month before the election.[29] A Venezuelan government propaganda organization, the Venezuela Information Office, also released a "fact sheet" about Smartmatic, defending the company from allegations at the time.[5]
By the time Smartmatic made its first large deal with the Venezuelan government in 2004, the majority of employees worked in its Venezuela offices shared with Bizta, with 70 in Caracas while only 7 worked between Boca Raton, Florida and Sunnyvale, California.[34] During the election, Smartmatic operated the voting machines, Bizta sent manual votes in remote areas to software centers and CANTV provided logistical assistance.[29]
Expansion
Following the 2004 Venezuelan recall election, Smartmatic rapidly expanded with the funds provided by the Venezuelan government. Bizta, Mugica's other start-up that was affiliated with the Venezuelan government, was then merged into Smartmatic.[11][13][26] Following Smartmatic's purchase of Sequoia Voting Systems in 2005 from the British firm De La Rue, a Committee on Foreign Investment in the United States investigation was initiated over Smartmatic's links to the Venezuelan government. Smartmatic later sold Sequoia in 2006, though "Smartmatic scrapped a simple corporate structure" of being based in Boca Raton "for a far more complex arrangement" of being located in multiple locations, raising more speculation.[35]
Smartmatic's headquarters moved to
London in 2012,
[3] while it also has offices and
R&D labs in the United States,
Brazil,
Venezuela,
Barbados,
Panama, the United Kingdom,
the Netherlands,
the United Arab Emirates,
the Philippines,
Estonia, and
Taiwan.
Though Smartmatic has made differing claims that they were either American or Dutch based, the United States Department of State states that its Venezuelan owners "remain hidden behind a web of holding companies in the Netherlands and Barbados".[13][3] The New York Times states that "the role of the young Venezuelan engineers who founded Smartmatic" is not transparent and that its organization is "an elaborate web of offshore companies and foreign trusts",[36] while BBC News states that though Smartmatic says the company was founded in the United States, "its roots are firmly anchored in (Venezuela)".[3] Multiple sources simply state that Smartmatic is a Venezuelan company.[7] Smartmatic maintains that the holding companies in multiple countries are used for "tax efficiency".[37]
