Maduro gained access to the US financial system through this Miami bank

Venezuelan President Nicolas Maduro speaks to the press after FIFA President Gianni Infantino visits the Miraflores Presidential Palace in Caracas, Venezuela, Friday, October 15, 2021. AP Photo/Ariana Cubillos, File

Venezuelan President Nicolas Maduro speaks to the press after FIFA President Gianni Infantino visits the Miraflores Presidential Palace in Caracas, Venezuela, Friday, October 15, 2021. AP Photo/Ariana Cubillos, File

AP

A lawsuit filed in federal court in South Florida alleges that a small Miami bank was under the control of Nicolás Maduro’s regime and that it was used to evade sanctions imposed by the US Treasury on the petro-state.

The lawsuit, brought by minority shareholders of Eastern National Bank, alleges that 99% of the bank’s shares are owned by a Curaçao-registered company, Mercorp, which in turn is owned by a Venezuelan company, Corpofin, which has intervened and is under control. the Venezuelan regime.

The lawsuit was filed in January against members of the bank’s board of directors, including Gabina Rodriguez, who chaired Eastern’s board between 2015 and 2021, after regime authorities appointed her as Corpofin’s financial controller.

“Rodriguez is an agent of the Maduro sanctioned regime in Venezuela, and as long as he remains in complete control of EU policy, the Maduro regime will have access to the financial system of the United States, allowing Maduro to evade OFAC sanctions,” notes Foreign Assets Control. Attached to the Treasury Department to the lawsuit filed by the minority shareholders of the bank.

The US government applied a series of sanctions against the Venezuelan regime and dozens of its leaders, accusing them, among other things, of destroying Venezuelan democracy, of being involved in numerous corruption schemes, and of turning the country into a narco-state.

Among other things, OFAC sanctions prevent companies and citizens under US jurisdiction from doing business with state officials and entities, unless they have special licenses granted by the Department of the Treasury.

Minority shareholders claim – Bancor Group Inc. and Stitching Particulier Fonds Franeker – that the directors of Eastern have breached their fiduciary duties, causing harm to the bank and damaging the value of the corporation’s shares.

Eastern National Bank has approximately $260 million in assets and four branches in South Florida, including Miami, Hialeah, and Doral.

In the meantime, the defendants acknowledge that the bank’s contribution composition is unique, but deny that this means that it is under the control of the Caracas regime and assert that the bank has obtained appropriate permission from OFAC to operate in the United States under the current structure.

It states one of the documents submitted by the defendants to the court, which includes, in addition to Rodriguez, the former directors and directors of the bank: Luis Ferreira, Cesar Gomez, Keith Parker, Carlos Rodriguez and Gustavo Macias.

licenses recognized by OFAC “are sufficient to demonstrate that the majority shareholding relationship has been approved by the appropriate regulatory agency (and) plaintiffs may not use this procedure to challenge the validity of board conduct … when such conduct is expressly authorized by the before the correct agency of the executive branch,” the document added.

The defense also claimed that the share of the contribution to the plaintiffs in the east of the country is insignificant, barely amounting to 1% of the total contribution.

Rodriguez’s connection to the Maduro regime was clearly spelled out in the prosecutors’ complaint. In 2009, the regime appointed her as a Corpofin beneficiary, thus giving her full control of Mercop.

In this way, Rodriguez has the power to appoint herself as the sole managing director of Mercorp, which in turn owns a majority of the shares in Eastern and therefore has the votes (unless voting rights are restricted) necessary to elect Eastern’s board of directors, they said in the lawsuit.

Rodriguez had a long career as a Venezuelan government employee for nearly 30 years, working for the state-owned Bank of Venezuela in 1993, at the Comptroller General of the Republic, from 1993 to 2002, and at the Ministry of Transport and Communications.

Prosecutors allege that Eastern helped the regime maintain access to the international financial system after “all US banks” terminated their correspondent banking relationship with Banco de Venezuela by opening and maintaining such an account with the state bank.

This decision subsequently caused problems for Eastern after the Currency Controller, an independent entity under the Treasury, reported in 2018 that it had discovered a series of deficiencies in its anti-money laundering and banking secrecy practices related to the operation. From the account with the Bank of Venezuela,

In the controller’s notice, the entity said it identified 10 account relationships for which there was “insufficient due diligence information,” prosecutors say.

The Controller ordered the Eastern Board of Directors, among other things, to appoint an enforcement committee of three directors, two of whom could not be employees, executives or shareholders of the bank.

According to the plaintiffs, the bank’s managers failed to take appropriate corrective actions, which the Comptroller’s Office itself highlighted in another warning issued in 2020.

“The bank failed to comply with the 2018 order and did not correct the deficiencies that led to the 2018 order,” the entity said. “The bank has engaged in numerous unsafe and flawed practices in violation of laws and regulations.”

This story was originally published August 14, 2022, 6:00 AM

Award-winning journalist with over 30 years of experience, specializing in covering Venezuela. A lover of history and literature.

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