U.S. Places Sanctions on Moscow-Based Evrofinance Mosnarbank
March 11 2019 - 4:34PM
Dow Jones News
By Mengqi Sun
The U.S. Treasury Department on Monday added Moscow-based
Evrofinance Mosnarbank to its sanction list, alleging the bank has
attempted to evade U.S. sanctions on Venezuela.
The bank, which is jointly owned by Russian and Venezuelan state
entities, has assisted and provided support for Venezuela
state-owned oil giant Petróleos de Venezuela SA, or PdVSA, which
has been on the U.S. sanctions list since January, the Treasury
said.
The latest action comes as the U.S. escalates the use of
sanctions on the Nicolás Maduro regime, which the U.S. has accused
of human-rights abuses. The U.S. has backed opposition leader Juan
Guaidó over Mr. Maduro.
"The United States will take action against foreign financial
institutions that sustain the illegitimate Maduro regime and
contribute to the economic collapse and humanitarian crisis
plaguing the people of Venezuela," Treasury Secretary Steven
Mnuchin said in a statement.
Evrofinance didn't immediately respond to a request for
comment.
The bank, on its Russian-language website, issued a statement
regarding the U.S. sanctions, saying that it continues to operate
in a stable manner and will unconditionally fulfill its obligations
to clients and partners in full.
Evrofinance was founded as a binational bank to fund joint
Russia-Venezuela oil and infrastructure projects, according to the
Treasury. Russian banks Gazprombank and state-owned VTB Bank own
stakes in Evrofinance. Venezuela's National Development Fund, also
known as Fonden, owns just shy of 50% of Evrofinance, according to
the Treasury. Gazprombank and VTB Bank were added to the U.S.
sanctions list in July 2014.
Evrofinance acted as the primary financial institution to
finance the Venezuelan oil-backed cryptocurrency, called the Petro,
which was launched in 2018, the Treasury said. Early investors in
Petro were invited to buy the cryptocurrency by wiring funds to a
Venezuelan government account at Evrofinance, according to the
department.
Evrofinance last May denied that it provides the clearing
services for the cryptocurrency, saying such allegations are
incorrect and that it doesn't provide such services for any
cryptocurrencies, according to a statement on the bank's
website.
Treasury officials say that Evrofinance's involvement in the
cryptocurrency demonstrates that Petro was launched by the Maduro
regime in the hope to skirt financial sanctions from the U.S. and
other countries. The Trump administration last March prohibited
Americans and U.S. companies from dealing in Petro.
Under the sanction, the Treasury Department's Office of Foreign
Assets Control prohibits U.S. individuals or entities to have any
dealings with Evrofinance. This includes all property and entities
that are owned directly or indirectly, 50% or more, by Evrofinance
in the U.S.
The sanction order is the latest in a series of evolving U.S.
actions related to Venezuela that have posed compliance risks for
U.S. and international banks.
Write to Mengqi Sun at mengqi.sun@wsj.com
(END) Dow Jones Newswires
March 11, 2019 16:19 ET (20:19 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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