The US will suspend remittances to Cuba through companies controlled by the Cuban military

The United States government will suspend the sending of remittances to Cuba through companies controlled by the Cuban military as of November 27, an official document reported.

The measure, announced in a blotter published in the Federal Register this Friday, will drastically affect FINCIMEX, a state financial institution belonging to CIMEX and under the umbrella of the Business Administration Group (GAESA), which processes the bulk of remittances that arrive from abroad to the island.

The document was issued by the Office of Foreign Assets Control (OFAC) of the Department of the Treasury and establishes the prohibition of transfers "related to remittances in any transaction involving entities or sub-entities identified on the Cuba Restricted List (CRL)".

The CRL, known as the State Department blacklist, was created in 2017 and lists more than 220 Cuban entities prevented from negotiating with citizens and companies under US jurisdiction, due to their links with the GAESA military complex.

OFAC Regulation It will be officially published on October 27 and will come into force one month after its publication.

Measure will fundamentally affect transfers Western Union, the largest issuer of remittances from the United States to Cuba. Once the ban is applied, it will not be possible to send money to the island through WU while the company uses FINCIMEX as a channel, with which it has had a contract signed since 1999.

But The restriction also knocks at the doors of VaCuba and Cubamax, two companies based in the United States that have established contracts with AIS for the delivery of electronic cards to receive money on the island. Some agencies had recently resumed service using Banco Metropolitano and Banco Popular de Ahorro.

Contacted by CyberCuba, A senior Western Union official said the company is reviewing the new regulation on Cuba. WU had under consideration the proposal to deliver the remittances in dollars to the recipients on the island. Currently, the money is delivered in convertible pesos (CUC), a currency in the process of devaluation after the opening of dollar stores and the imminent monetary unification in the country.

"We are considering the OFAC ruling and will provide additional information when we have more clarity about its potential impact on our customers," said a senior official at the corporation, based in Denver, Colorado.

The document constitutes the regularization of ssanctions previously established by the US administration against FINCIMEX, last June, and then, in September, against American International Services (AIS), a branch of CIMEX for the processing of remittances via electronic cards.

In fact, the sanctions had not been applied until now due to the lack of OFAC regulations.

"This measure can cause a real economic and social upheaval in Cuba," lawyer and political analyst Sergio Comas told CyberCuba.

It is estimated that remittances sent to Cuba reach $3.5 billion annually, the second source of income for the island's economy after professional services abroad.

Comas pointed out as a "lack of foresight" that the Cuban government has not already designated an entity not controlled by GAESA as an alternative to negotiate the remittances processed until now exclusively by FINCIMEX.

The OFAC provision does not imply a suspension of the sending of remittances to Cuba, but rather their processing through entities controlled by GAESA. Operations could be transferred to other state institutions with the capacity to negotiate with Western Union and other companies and shipping agencies established in the United States.

The GAESA military consortium is directed by Brigadier General Luis Alberto Rodríguez López-Calleja, former son-in-law of Raúl Castro, who recently was included on the list of blocked people by the Treasury Department (SDN), which entails the freezing of their assets under US jurisdiction and the ban on visas to travel to the United States.

Although the measure was formally announced this Friday, the presidential elections in the United States on November 3 will define its permanence and real effect on money transfers, since the Democratic candidate Joe Biden has publicly expressed his intention to restore the sending of remittances to Cuba without restrictions, as implemented by the Barack Obama administration.

Currently, Treasury Department regulations limit remittance shipments to $1,000 dollars per quarter to family members in Cuba.

Reaction of the Cuban government

Cuban Foreign Minister Bruno Rodríguez Parrilla immediately issued a message on his Twitter account assuring that with the prohibition of remittances through military companies "the United States insists on harming the Cuban people."

"The new measure against remittances reaffirms that there are no limits for a criminal government in imposing policies that limit contacts, communication and mutual aid between families in both countries," the message reads.

Immediately, several users responded to the Cuban Foreign Minister's tweet: "Cuba and its officials can do a lot to connect families and they don't do it, it is something that is in their hands, forget about the USA and do their job"; "The Cuban dictatorship kidnaps the people of Cuba and complains when the family of those kidnapped in the US refuse to pay them the ransom," were some immediate reactions on social networks.

The independent journalist José Raúl Gallego also questioned the publication: "And this is said by the representative of the country that prevents hundreds of Cubans from entering his country, that punishes doctors who abandon employment contracts with eight years without seeing their family, that prevents its citizens from importing and exporting freely.