Reps. Berman, Flake Ask for Explanation of OFAC Role in Disrupting Meeting in Mexico City
Reps. Berman, Flake Ask for Explanation of OFAC Role in Disrupting Meeting in Mexico City
Washington, D.C. - Rep. Howard Berman (D-CA) and Rep. Jeff Flake (R-AZ) today sent a letter - also signed by 22 of their House colleagues - to Treasury Secretary Snow expressing their concern about actions taken by the Office of Foreign Assets Control (OFAC) to disrupt a meeting in Mexico between Cuban Officials and executives from American oil companies. OFAC ordered the unprecedented eviction of 16 Cuban government officials staying at the Sheritan Hotel in Mexico City on February 3, 2006.
The Congressmen asked Secretary Snow if OFAC, by this action, is setting a new standard that no American owned hotel or other commercial enterprise can ever provide services to a Cuban national, and pointed out that any new OFAC standard that targets such an individualized and limited transaction-the renting of a hotel room-could call into question any number of future commercial exchanges between American businesses and Cubans.
"American business leaders and the American people deserve to know what this action means for future commercial transactions," the letter stated. The Congressmen asked Secretary Snow to explain what constituted the violation of the embargo at the Mexico City Sheraton, and if OFAC intends to apply a new standard in the future.
February 21, 2006
Honorable John Snow Secretary Department of the Treasury
1500 Pennsylvania Avenue NW
Washington, D.C. 20220
Dear Secretary Snow:
We are writing to express our concern about actions taken by the Office of Foreign Assets Control (OFAC) to disrupt a meeting in Mexico between Cuban officials and executives from American oil companies. We believe this incident is an overreaching application of U.S. law that could have significant worldwide implications. We are advised that OFAC contacted Starwood Hotels and Resorts Worldwide, Inc. in the United States and ordered that company, which owns Sheraton Hotels, to evict 16 Cuban government officials staying at the Sheraton Hotel in Mexico City on February 3, 2006. Those officials were participating in a meeting hosted by the U.S.-Cuba Trade Association that included the Vice-Minister of Cuba's Ministry of Basic Industries, and representatives of the U.S. oil industry. OFAC justified their action by stating "the hotel in Mexico City is a U.S. subsidiary, and therefore prohibited from providing a service to Cuba or Cuban nationals." Despite this statement, we also understand that 12 Cuban musicians staying at the same hotel were not asked to leave.
This unprecedented eviction raises serious questions: Is OFAC setting a new standard that no American owned hotel or other commercial enterprise can ever provide services to a Cuban national?
The seemingly contradictory action of evicting the 16 Cuban government officials but allowing the Cuban musicians to stay suggests that it was the actual meeting between Cuban government officials and U.S. business representatives that was in violation. But OFAC has long taken the position that the sanctions do not bar U.S. citizens, including representatives of U.S. energy companies, from having "informational" meetings or contacts in third countries with officials from U.S. embargoed countries. In the past, this has been a point of significant interest with regard to Libya, Iran and Iraq in particular.
Any new OFAC standard that targets such an individualized and limited transaction, the renting of a hotel room, could call into question any number of future commercial exchanges between American businesses and Cubans. By this logic, would a U.S. company that owns a restaurant in London be subject to penalty if someone from an embargoed nation had lunch there? If a U.S. owned movie theater in a foreign country sold a ticket to a Cuban, is that company subject to penalty?
While considering the implications of a potential new policy, we are reminded that a far greater proportion of OFAC's staff and resources are already allocated to enforcing the Cuban embargo than are assigned to tracking the financial transactions of Al-Qaeda and other terrorist organizations that pose a national security threat to the U.S. If OFAC is now to scrutinize the guest lists at every American owned hotel in the world, this will certainly exacerbate this imbalance. American business leaders and the American people deserve to know what this action means for future commercial transactions. We would appreciate an explanation of what constituted the violation of the embargo at the Mexico City Sheraton, and if OFAC intends to apply a new standard in the future.
Sincerely,
1. Howard L. Berman (D-CA)
2. Jeff Flake (R-AZ)
3. Jim McDermott (D-WA)
4. Ray LaHood (R-IL)
5. Jim Kolbe (R-AZ)
6. Michael F. Doyle (D-PA)
7. Jo Ann Emerson (R-MO)
8. Lois Capps (D-CA)
9. Neil Abercrombie (D-HI)
10. William D. Delahunt (D-MA)
11. Collin C. Peterson (D-MN)
12. Bob Ethridge (D-NC)
13. Rosa L. DeLauro (D-CT)
14. Pete Stark (D-CA)
15. James P. McGovern (D-MA)
16. Dennis J. Kucinich (D-OH)
17. Lincoln Davis (D-TN)
18. Betty McCollum (D-MN)
19. Sam Farr (D-CA)
20. Raul M. Grijalva (D-AZ)
21. Bart Gordon (D-TN)
22. Henry A. Waxman (D-CA)
23. Jose E. Serrano (D-NY)
24. Barbara Lee (D-CA)
25. Ron Paul (R-TX)
http://www.house.gov/apps/list/press/ca28_berman/OFAC_SNOW.html