Tuesday, July 27, 2010

OFAC Nails UN Bank For Dealing With Cuban Diplomats to the UN

Export Law Blog (blog) - July 19

By Clif Burns

The latest monthly release of civil penalty information by the Office of Foreign Assets Control (“OFAC”) describes a penalty “settlement’ with the United Nations Federal Credit Union, which agreed to pay $500,000 to settle charges that the UNFCU “dealt in property in which Cuba or a Cuban national had an interest’ as they quaintly say it in OFAC-speak. In ordinary English this means that UNFCU engaged in banking transactions with Cubans, likely with Cuban diplomats to the United Nations.

Of course, we have to say the transactions were likely with Cuban diplomats because, given OFAC’s longstanding aversion to providing anything but the most minimal details about its penalty settlements, the notice leaves out such crucial details as whether the Cubans involved were diplomats, non-diplomatic Cuban officials, ordinary Cubans, or herds of Cuban cattle. Nor were the types of transactions involved mentioned or their amounts.

In this case, the absence of details makes OFAC look foolish by suggesting the possibility that OFAC is penalizing the UNFCU for providing banking services to Cuban diplomats posted to the U.N. Apparently, such diplomats need to travel with suitcases of Cuban pesos and pay for their meals in the U.N. cafeteria with their national currency.

If that’s what OFAC is doing, it would be in direct contravention of the U.N. Headquarters Agreement, particularly given that the UNFCU is located in the U.N. Headquarters area. Article V, Section 15(4) of that agreement provides that even with respect to diplomats from countries not recognized by the United States, such as Cuba, the U.S. must accord them the same privileges and immunities as other diplomats while within the headquarters district. If a diplomat from France can bank at the UNFCU located in the U.N. Headquarters district, so can Cuban diplomats, no matter how much OFAC hates Castro and his diplomatic lackeys.

The UNFCU website has this statement (click on “Account Restrictions”) about its ability to deal with Cuban diplomats:

Please be aware that UNFCU, under authorization from the US Treasury Department, is only permitted to operate accounts for actively employed UN staff stationed in Cuba, Iran, Burma, and for Cuban citizens who are stationed in the United States.

Based on this, perhaps what was going on and again OFAC forces us to speculate was that the UNFCU was providing banking services to Cubans at U.N. locations outside the United States. The UNFCU website’s branch listing shows that the UNFCU has branches in Geneva, Vienna, Rome and Nairobi. Of course, the UNFCU’s extra-territorial application of U.S. sanctions could create a new problem for itself because these sanctions could well violate local laws that prohibit discrimination based on national origin.

Additionally, and more significantly, the UN could always solve the problem by only providing office space to financial institutions that do not, like UNFCU, discriminate against UN members based on national origin.

Friday, July 2, 2010

Who is a spy and why?

La Alborada - July 2

The FBI has charged eleven people with conspiracy to act as agents of a foreign government --Russia-- without notifying the Attorney General. That's not "spying" or "being an unregistered foreign agent," but conspiracy to act as an agent. The Associated Press interpreted the news this way: "Russian agents infiltrated US society, charges say": infiltrated not the government or the Pentagon, but society. Nothing that we have found in the news so far suggests that the accused gathered any information of significance. The indictment charges that the defendants were paid or expected to be paid by Russia for their work.

The eleven defendants were arrested and jailed. Proceedings in the matter will determine whether or not they are guilty of any of the charges brought. If they are found guilty, they will surely serve time in prison.

They will never be called "dissidents," the generic name given to a number of people in Cuba who include agents of the US government. Many of them have been jailed since 2003. The evidence against the latter, obtained in part from Cuban security agents who had been posing as collaborators and also, as was the case here, by surveillance, was summarized in a book, Los Disidentes, published soon afterwards in Cuba.

The evidence showed that the dissidents were coordinated, directed, and financed by the US Interests Section in Havana, and also from Madrid. The declared independent journalists turned out to be independent from the Cuban government, but not from the US. They were told what kind of information they should generate; on their compliance depended the support, including payment in money and kind, that they received from the Interests Section, at which they often met to coordinate their activities.

The financing of dissidents --or subversives, depending on point of view-- in Cuba by the US is no secret. Congress periodically appropriates money in the millions of dollars officially earmarked to support the dissidents. When it is the US that does this, it considers it proper and necessary, a matter of course. It sees no need to make such payments a covert operation; in fact, it announces the payments proudly. The US also helps to arrange favorable media coverage for the dissidents.

The mass media never, ever, mention the evidence of control of and payment to the dissidents arrested in 2003. It, too, considers it normal that the US should sponsor them, or pretends that there is no connection, although charges of such an arrangement have become a major factor in reporting on the alleged Russian agents.

Russia is not attempting to overthrow the US government, nor could it do so; certainly not by using the kind of information that is at issue in the current case. The US no doubt has its own agents and spies in Russia, but it is not seeking to overthrow the Russian government. The US, however, is committed by law to overthrow the Cuban government, which is the ultimate goal of the blockade. Alan Gross was in Cuba surreptitiously under a grant dedicated to such a purpose. In 2003, in fact, the Bush administration served notice to states that it did not like that they could experience the same shock and awe to which Iraq was subjected.

SInce 1959, the US has sponsored and/or sheltered a variety of terrorists, such as Luis Posada Carriles, whose goal is to overthrow the government of Cuba by force. It was because of this that Cuba sent agents to Florida to gather information on what these elements were planning. That information did not remain secret, however; Cuba turned it over to the FBI. As a result, the FBI arrested the Cuban Five, who are now serving up to two consecutive life sentences.

Whatever one thinks of the Cuban government, it should not be hard to see why the Cubans would be upset at the financing and directing of US agents on the island, to the point of imprisoning them, especially considering US policy and the circumstances of 2003.

What justifies the difference in approach to the case of those charged as Russian agents and the case of the US agents in Cuba? Essentially, it comes down to two things: 1) Because we are Good and they are Bad; and 2) Because we can do it.

The policy --and law-- as to Cuba remains in effect. There is nothing to suggest that, if the Cubans did not react to the funding and direction of dissidents on the island, the US would cease to sponsor agents there. On the contrary, there would likely be more such agents in Cuba.

The US has Cuban agents in jail, and Cuba has US agents in jail. If there is the will to improve relations between the two governments, one place to start would be to exchange them.

Washington, DC
Cuban American Alliance Education Fund