Banco Financiero Internacional (BFI) and Banco Metropolitano block withdrawals on accounts of foreign firms

On this hot summer day the tensions are palpable at Banco Financieros 5th avenue branch, foreigners outside chat between themselves using words like “incredible”, “diabolical” and even “bank fraud”. Their chagrin being something that few are willing to talk about in open through fear of reprisals on their accounts or total loss of their deposits. No foreign journalists have written anything about this scenario either, despite it being common knowledge in the tight knit expat circles of Havana where most foreign business owners reside.


In a short interview with one Italian businessman, who requested to remain anonymous through fear of reprisals said “they´ve blocked us sending transfers abroad and placed a 6 month window of time for these to be processed plus they´ve introduced a law that impedes our withdrawals of cash so basically they´ve confiscated our money and nobody does anything about it”. Another person of middle eastern origin involved in real estate venture associated with commercial office rental said “it´s been 7 months now, we can´t repatriate our rental income to our investors abroad, we cannot transfer money and even if these people visit Cuba and request some money from us we cannot withdraw the funds, basically our Joint venture agreement has no value today. The Cuban side takes its part and our income is trapped in our account here (in Havana)”


Rumors also abound concerning Francisco Soberon, Cuba´s long time central bank chief who abruptly resigned on June 4, 2009 apparently due to Raul Castro´s order to block withdrawals and bank transfers by foreign entities in Cuba. The feud being that Ernesto Medina Banco Financiero´s previous president accepted orders to block all outbound transactions of all types to the behest of Soberon who considered this banking mutiny. Soberon apparently resigned over the issue and Medina took Cuba´s top banking job as head of Cuba´s central bank.


So where is the money? Well nobody knows for sure but, some foreigners have been advised that Cuba has taken emergency measures so as not to default on payments to Venezuela and China and in the process emptied the coffers at Banco Financiero and Banco Metropolitano where 95% of all foreign companies hold their accounts. A bank employee who also refused to be named said that tensions at the main branches in the Sierra Maestra building and the aforementioned 5th avenue branches of BFI as foreigners needing cash for basic needs are turned away and those needing higher volumes of cash for trips are placed on a “waiting list”.


But, most firms remain mute on the subject and are unwilling to talk on record. Some cite that they fear their licenses will be revoked or their representation offices closed if they speak out. Others say that they have even had to resort to opening accounts in the neighboring Cancun, Nassau or Panama, flying there regularly to get cash to maintain there local operations afloat. One man said, “it’s as if our accounts here don´t exist nor the monies in them, we cannot withdraw money or transfer it, all we can do is pay bills to Cuban entities with checks, we must even advise when such payments are due as if we´re school kids, it’s a sham”


Easily the highest number of foreign registered companies are foreign travel agencies who themselves advise that Cuban suppliers are introducing “sold out” or “stop sales” from the first day of high season until the last essentially disallowing them to sell travel services. Nevertheless, these agencies also know that Cuban reservations are down over previous years further adding to the frustration. Those who complain are told that orders came from MINTUR, Cuba´s tourism ministry, to force visitors to pay directly in Cuba (presumably in cash) meaning payments go straight to the Cuban companies. One agency owner said “we´ve been unofficially given the right to sell Cuba´s offers in low season only as they block us selling in high season in order to take all business for themselves. I called a hotel after being refused a confirmation through my obliged booking agent Cubanacan only to be told that the hotel had just 46% occupancy”. The blocking of sales via foreign agencies appears to be directly from central government orders. The aforementioned agent said “they want cash, lots of it and directly into their accounts and the irony is that when we complain they tell us to tell our clients to pay at the reception or the car rental office. Incredible”


Another agent with two offices in Havana and agencies in Europe had a different take on the sold out declarations “when they tell us they´re sold out on cars, hotels etc. we tell our clients everything is sold out and offer them Jamaica or Cancun, we even offer clients calling our Cuban offices other Caribbean destinations, the clients are equally happy and we get the sale. The Cuban’s are shooting themselves in the foot”

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