US sanctions Russia based bank for its work in Venezuela

WASHINGTON — The Trump administration imposed sanctions Monday on a Moscow-based bank jointly owned by Russian and Venezuelan state-owned companies, for allegedly trying to circumvent U.S. sanctions on the South American country.

Meanwhile, Secretary of State Mike Pompeo lashed out at Cuba and Russia for continuing to support Venezuelan leader Nicolas Maduro and contributing to his country's economic crisis. He said Havana and Moscow are directly responsible for the suffering of the Venezuelan people.

The Treasury Department's Office of Foreign Assets Control said in a statement that it is targeting Evrofinance Mosnarbank for its support of the Petroleos de Venezuela S.A., an entity previously targeted by sanctions in January.

Evrofinance said in a statement that it is carrying out its activities as normal despite the announcement and pledged to "meet its obligations to the clients and partners in full."

The U.S. and more than 50 governments recognize opposition leader Juan Guaido as interim president of the country. They say Maduro wasn't legitimately re-elected last year because opposition candidates weren't permitted to run.

"This action demonstrates that 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," said Treasury Secretary Steven Mnuchin.

Evrofinance was founded as a bi-national bank to fund joint Russia-Venezuela oil and infrastructure projects, according to OFAC. It has offices in Caracas and in Beijing, and it listed net assets as over $830 million as of the end of September last year.

Maduro's predecessor, President Hugo Chavez, bought a 49 percent stake in Evrofinance through the Venezuelan National Development Fund back in 2011.

The other stake belongs to Russia's Gazprombank, in which the majority Russian state-owned gas producer Gazprom is a shareholder, and to state-owned VTB Bank, which is Russia's second largest bank.

OFAC imposed sanctions on Gazprombank back in 2014.

When the Venezuelan government launched a cryptocurrency —the Petro— last year, it invited early investors to buy by wiring funds to a Venezuelan government account at Evrofinance, OFAC said in a press release.

Shortly after the Treasury announcement, Pompeo accused Russian "oligarchs and kleptocrats" of stealing Venezuela's sovereign wealth and attacked Cuba as the "true imperialist power" in Venezuela.

Cuba has made the same accusation against the United States, alleging that the U.S. is after Venezuela's oil and suggesting that Washington is responsible for crippling power outages that have hit Venezuela.

Pompeo told reporters at the State Department the U.S. is interested only in the welfare of the Venezuelan people and the power outages are the result of Maduro's own mismanagement and greed.

"Those are a direct result of years and years of neglect of the Venezuelan energy system," he said. "That was the cause of the blackouts that have taken place."