Cuba Business

Cuba mystery money in Swiss bank gets scrutiny

Posted July 23, 2004 by publisher in Cuba Business.

BY NANCY SAN MARTIN | .(JavaScript must be enabled to view this email address) | Miami Herald

U.S. Rep. Ileana Ros-Lehtinen of Miami wants answers on $3.9 billion that Cuba deposited in a Swiss bank.

Rep. Ileana Ros-Lehtinen won’t let go of the mystery: Just where did the Cuban government get up to $3.9 billion it funneled through a Swiss bank over seven years.

Was Havana simply, as it claims, banking its income from tourism and remittances that Cubans abroad send to their relatives on the island? Or was dirty money involved?

Ros-Lehtinen, the Cuban-born Florida Republican, wants to know, and she has been badgering officials of the United Bank of Switzerland (UBS) and the U.S. Federal Reserve for answers.

‘‘That’s an awful lot of money,’’ Ros-Lehtinen told The Herald.
According to the latest answers she received from UBS officials Wednesday, Havana delivered up to $3.9 billion in U.S. currency to UBS in 1,900 transactions from 1996 to April 2003 for deposit to one Cuban government bank account at UBS.

In a statement published last month in the state-run Granma newspaper, the government said the cash was “obtained from sales in the hard-currency stores, tourism-related activities and other commercial services in foreign banks.’‘

According to Cuban government figures, its revenues from tourism and hard-currency stores—where goods are sold for U.S. dollars, mostly to Cubans who receive remittances from abroad—amounted in 2002-03 alone to about $2 billion.

Ros-Lehtinen has her doubts about the source of the funds, and has requested a full briefing in September from UBS officials.

‘‘Given the . . . significant amount of money we are dealing with, it is doubtful that these . . . funds derived from tourism but, rather, could have stemmed from one of Castro’s nefarious activities, such as drug trafficking,’’ she said in a July 12 letter to Federal Reserve Chairman Alan Greenspan.


Deputy Assistant Treasury Secretary Juan Carlos Zarate told The Herald Thursday that the U.S. attorney’s office in New York is investigating a ‘‘potential nexus out of New York’’ with the Cuba-UBS deal, but declined to go into details.

The tale of Cuba’s dealings with UBS started within another mystery: the $762 million in U.S. cash that American troops in Iraq found in hide-outs linked to Saddam Hussein.

The cash was traced to several foreign banks, including UBS, that had been contracted by the Federal Reserve Bank of New York to exchange new U.S. dollars for worn-out bills being taken out of circulation. The program is known as the Extended Custodial Inventory.

But the ECI agreement specifically barred the foreign banks from doing business with countries under U.S. sanctions.


Although U.S. investigators who examined the Iraqi hoard determined the banks had not sent U.S. cash directly to Baghdad, they discovered UBS had illegally transferred about $5 billion to Cuba, Libya, Iran and the former Yugoslavia.

The Federal Reserve Board canceled its contract with UBS last year and in May fined it $100 million for the violations.

Still unclear is why UBS employees violated the U.S. regulations, and then tried to conceal the Cuban deals by altering the bank’s records. No one has so far been charged with any crimes.

The majority of the transactions with Cuba took place from 1996, when the Federal Reserve contracted UBS for the ECI program, through April 2003, said Yleem Poblete, staff director for the House International Relations subcommittee on the Middle East and Central Asia, which Ros-Lehtinen chairs.

The cash was deposited into a Cuban government account at UBS opened before the Federal Reserve contracted UBS, Poblete added.

Member Comments

On July 24, 2004, publisher wrote:

I have read and posted articles by this author before and they seemed to have been more objective than the wording in this article:

“$3.9 billion it funneled” - deposited would probably be a more appropriate term.

“and remittances that Cubans abroad send to their relatives”

“The tale of Cuba’ dealings with UBS started within another mystery: the $762 million in U.S. cash that American troops in Iraq found in hide-outs linked to Saddam Hussein.”

Now Iraq and Cuba are mentioned in the same article?

This story really STINKS of bias or at least low quality work.

On July 27, 2004, Jesus Perez wrote:

Ros-Lehtinen’ time would be better spent trying to track down Bin Laden’ money and the money which funded the 9/11 attacks. The Cuban economy has been sufficiently terrorized as a result of the U. S. embargo for the last forty years.