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U.S. Sanctions Russian Bank Over Dealings With Venezuela

Updated

The United States and more than 50 governments recognize opposition leader Juan Guaido as interim president of the country.

The United States has imposed sanctions on a Russian bank over its dealings with Venezuela's state oil company PDVSA, as U.S. Secretary of State Mike Pompeo accused Russia's state-controlled Rosneft of buying oil from the company.

The move by Washington on March 11 turns up the pressure on both Caracas and Moscow, which is one of the biggest financial backers for Venezuela's embattled leader, Nicolas Maduro.

President Donald Trump's administration has declared Maduro to be an illegitimate leader, and has backed opposition leader Juan Guaido to replace him.

In announcing the sanctions against the bank, Evrofinance Mosnarbank, the U.S. Treasury Department said its net assets had grown by over 50 percent during 2018, even as U.S. sanctions had increased.

"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," Treasury Secretary Steven Mnuchin said.

In comments to reporters, Pompeo accused Russia and Cuba of helping to create the crisis in Venezuela, by allowing Rosneft to buy oil from Petroleos de Venezuela SA, known as PDVSA.

"Russia's state-owned oil company, Rosneft, continues to purchase crude oil cargoes from PDVSA, Venezuela's state-owned oil company, in defiance of U.S. sanctions," Pompeo said. "And Rosneft's CEO, Igor Sechin, continues to throw a lifeline to the regime."

Founded in 2011, the Moscow-based bank is jointly owned by a group of Russian banks and Venezuela's National Development Fund.

Evrofinance Mosnarbank said in a statement on its website that it was operating in a "stable manner" and would "fulfill all of its obligations towards clients and partners.”

Separately, U.S. national-security adviser John Bolton issued a warning to international banks and financial institutions.

"Bankers: Do not help Maduro and his accomplices steal the assets of the Venezuelan people. The United States is watching. The world is watching. The Venezuelan people are watching," he wrote on Twitter on March 11.

Gazprombank, which is Russia’s third-biggest lender and includes among its shareholders Russian state gas company Gazprom, said the U.S. Treasury decision would not affect it.

"Gazprombank has a minority stake in Evrofinance Mosnarbank," it said. "Gazprombank does not carry out operations on the accounts of companies that are sanctioned by the U.S. over Venezuela."

The United States and more than 50 governments recognize Guaido as interim president of the country. They say Maduro wasn't legitimately reelected last year because opposition candidates weren't permitted to run.

With reporting by Reuters and AP
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