Who Benefits From U.S. Debit Cards in Cuba
Monday, November 23, 2015
Last week, Florida-based Stonegate Bank, in partnership with MasterCard, announced it will issue debit cards to be used in Cuba by authorized U.S. travelers.
An open question remains whether the use of these debit cards constitutes financing (e.g. through an overdraft feature) and, therefore, a violation of Section 103 of the LIBERTAD Act, "Prohibition Against Indirect Financing of Cuba."
Clearly, credit cards would have been illegal -- but Congress, bank regulators and perhaps even the courts, should look into whether these debit cards also constitute financing for purposes of this prohibition.
But from a policy perspective -- who stands to benefit the most from the use of these debit cards in Cuba?
Currently, there are 10,000 locations in Cuba that process such cards, of which 2,500 were installed in 2015, pursuant to Obama's January regulations authorizing their use.
Every single one of these locations are regime-owned facilities.
And, according to the AP, the Castro regime is so excited about the fees and income it will charge for these cards that -- "on Wednesday, officials with Cuban state company Cimex said the government plans to [further] expand credit card processing to commercial and retail outlets throughout Cuba in early 2016."
Again, all at regime-owned facilities.
But, as the AP reveals, the biggest winner is the "Cuban state company" in charge of processing every single one of these transactions -- CIMEX.
CIMEX stands for Cuban Export-Import Corporation, one of the Cuban military's largest commercial entities, whose operations range from banking to retail. It's yearly revenues are over $1.5 billion and rising -- thanks to Obama's new policy.
The head of CIMEX is Colonel Hector Oroza Busutin, a Raul Castro confidant. CIMEX falls within the greater GAESA military conglomerate, which is headed by Raul's son-in-law, General Luis Alberto Rodriguez Lopez-Callejas.
Thus, once again, the beneficiaries of Obama's new policy are not the Cuban people, or the "self-employed" entrepreneurs, who the President purports to support.
The beneficiaries are the Castro family and its military conglomerates.
An open question remains whether the use of these debit cards constitutes financing (e.g. through an overdraft feature) and, therefore, a violation of Section 103 of the LIBERTAD Act, "Prohibition Against Indirect Financing of Cuba."
Clearly, credit cards would have been illegal -- but Congress, bank regulators and perhaps even the courts, should look into whether these debit cards also constitute financing for purposes of this prohibition.
But from a policy perspective -- who stands to benefit the most from the use of these debit cards in Cuba?
Currently, there are 10,000 locations in Cuba that process such cards, of which 2,500 were installed in 2015, pursuant to Obama's January regulations authorizing their use.
Every single one of these locations are regime-owned facilities.
And, according to the AP, the Castro regime is so excited about the fees and income it will charge for these cards that -- "on Wednesday, officials with Cuban state company Cimex said the government plans to [further] expand credit card processing to commercial and retail outlets throughout Cuba in early 2016."
Again, all at regime-owned facilities.
But, as the AP reveals, the biggest winner is the "Cuban state company" in charge of processing every single one of these transactions -- CIMEX.
CIMEX stands for Cuban Export-Import Corporation, one of the Cuban military's largest commercial entities, whose operations range from banking to retail. It's yearly revenues are over $1.5 billion and rising -- thanks to Obama's new policy.
The head of CIMEX is Colonel Hector Oroza Busutin, a Raul Castro confidant. CIMEX falls within the greater GAESA military conglomerate, which is headed by Raul's son-in-law, General Luis Alberto Rodriguez Lopez-Callejas.
Thus, once again, the beneficiaries of Obama's new policy are not the Cuban people, or the "self-employed" entrepreneurs, who the President purports to support.
The beneficiaries are the Castro family and its military conglomerates.
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