News
U.S. Financial Institutions See Cautious Entrée into Cuba, With Compliance Challenges
By Brian Monroe
printFor U.S. financial institutions, recent talks about a potential thaw between the United States and Cuba have signaled more than just a possible end to a Cold War enmity. They've signaled dollar signs. Gingerly, banks and money services businesses (MSBs) are eyeing the communist island as a once closed market that may open up in the next three to seven years, according to bank officials. In a move that grabbed the attention of money transmitters, the Obama administration said on April 13 that it would ease restrictions on wires sent to Cuba and allow more travel and telecommunications business in...
TO READ THE FULL STORY
Related News
The expected reemergence of Iran on global markets will likely pose the toughest challenge for sanctions compliance officers in the coming year, according to Alexandre Lamy, an attorney with Baker & McKenzie's International Trade Practice Group.
The partial lifting of U.S. sanctions against Cuba is raising new questions for American banks that have issued credit cards to clients traveling to the island-nation, according to compliance experts.
Thursday's partial easing of U.S. sanctions against Cuba will do much to bring money to the island nation, but even a full rollback of economic restrictions won't soon resolve the biggest barriers to entry for American banks: low profit margins and high regulatory risk.
President Obama announced plans Wednesday to significantly ease commercial and economic sanctions targeting Cuba, dismantling key elements of the 54-year U.S. embargo against the Caribbean nation.
High-profile sanctions cases are spurring large banks and third-party software vendors to improve how they identify when counterparts and clients secretly act on behalf of blacklisted entities, say compliance experts.
The Royal Bank of Scotland will pay the United States $500 million over Bank Secrecy Act and sanctions violations committed by the now defunct ABN Amro, U.S. officials said Monday.
The U.S. Treasury Department is focusing less on punishing individuals who travel to Cuba and more on egregious, high-dollar violations, according to a government report.
A contradiction between U.S. sanctions rules and federal guidance on Cuban money remitters is prompting some compliance staff to scratch their heads, say analysts.
New U.S. Treasury Department regulations easing economic sanctions against Cuba and the compliance burden of financial institutions could make it easier for money remitters to break the rules, say analysts.
The U.S. Treasury Department officially loosened restrictions on money sent to Cuba Thursday, lifting caps on dollar amounts remitted and expanding the number of individuals who can receive the funds.
Despite all the rhetoric, combating the networks that finance terrorism and criminal organizations is not a priority for the international community, according to Jimmy Gurulé, a law professor at Notre Dame.
The U.S. Treasury Department will likely move quickly in drafting regulations that loosen most restrictions on money remitted from the United States to Cuba, say banking professionals.
The Obama administration said Monday that it would lift restrictions on how much money Cuban Americans can send to Cuba, easing financial constraints first established in the 1960s.