U.S. Asserts Guaido's Control Over Key Venezuela Bank Accounts

(Bloomberg) -- Secretary of State Michael Pompeo took another step to bolster Juan Guaido as Venezuela’s interim president, certifying that the National Assembly leader has control over key government bank accounts based in the U.S.

Pompeo determined that Guaido has authority over the nation’s accounts at the Federal Reserve Bank of New York and other U.S.-insured banks, State Department deputy spokesman Robert Palladino said in a statement. The State Department has so far declined to say how much money is in the accounts, as did officials for the Treasury Department and the Federal Reserve Bank of New York. 

The announcement Tuesday was the latest in a succession of moves designed to steer power and resources to Guaido in the days since President Donald Trump declared President Nicolas Maduro’s rule illegitimate and said the U.S. was now recognizing Guaido as interim leader. On Monday, the administration slapped sanctions on state-owned oil company PDVSA that effectively block Maduro from exporting crude to the U.S.

Vice President Mike Pence also met Tuesday with a new Venezuelan envoy appointed by Guaido, Carlos Alfredo Vecchio. The new U.S. special envoy for Venezuela, Elliott Abrams, also attended the meeting, a White House official said. Vecchio told reporters at the White House the meeting lasted almost an hour.

“We were so clear that this fight is not about ideology. This is a fight between democracy and dictatorship,” Vecchio said. “We cannot do this alone.”

U.S. Asserts Guaido's Control Over Key Venezuela Bank Accounts

Last week, U.S. officials successfully lobbied the Bank of England to deny Maduro access to $1.2 billion worth of gold the government holds in London, stymieing the regime’s efforts to pull in funds from abroad. The U.K., along with Canada and most Latin American countries, followed the U.S. in recognizing Guaido as the country’s legitimate leader.

Transferring authority over U.S.-based accounts to Guaido “will help Venezuela’s legitimate government safeguard those assets for the benefit of the Venezuelan people,” Palladino said in his announcement. “We call on other governments to recognize interim President Juan Guaido and take similar steps to protect Venezuela’s patrimony from further theft by Maduro’s corrupt regime.”

Monica de Bolle, a senior fellow at the Peterson Institute for International Economics, said the Maduro regime probably wants to keep the accounts so that Venezuela’s creditors don’t try to take those assets. In 2017, Maduro announced he was suspending payment on Venezuelan debt.

“I would imagine that if at any point the Venezuelan Central Bank kept some of its reserves in the U.S., it could be rather significant,” de Bolle said. “This said, it certainly won’t come anywhere near what Venezuela needs to rebuild itself.”

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