Lawyers who have cases in Venezuela or have sued its government have mixed reactions to a congressional bid to sanction some Venezuelan officials accused of human-rights violations.
The proposal, which passed the U.S. Senate Foreign Relations Committee last week, would prevent 25 officials on a “blacklist” from visiting the United States and freeze their assets. It mirrors a plan targeting Russian officials for actions against Ukraine.
The measure pushed by U.S. Sen. Marco Rubio does not go as far as embargoes against Cuba and Syria.
Closer to home, the Miami City Commission agreed Thursday to censure and investigate the business dealings of several Venezuelan entrepreneurs who own property and run businesses in Miami-Dade County. Among those targeted are Raul Gorrin, Gustavo Perdomo and Juan Domingo Cordero, majority shareholders in Venezuelan’s Globovision network, who reportedly own homes in Miami. It’s unclear what practical results the measure could achieve.
Some Miami lawyers applauded the federal sanctions and say the government should be able to locate targeted assets with ease. However, others call the proposed restrictions futile and suggested any assets, funds or property would be well-hidden offshore under the names of “straw men.”
“This is very different from what we are doing in Cuba,” said Luis Perez, co-chair of Akerman’s Latin American and Caribbean practice. “Here we are going after pinpointed individuals. The reality is unless something is done there is little hope of precipitating change.”
If the measure passes, Perez feels that while the sanction targets would likely try to hide assets, the U.S. government should have some success finding them. He cited the example of the U.S. government fining Credit Suisse $2.6 billion last week for helping U.S. citizens hide money.
“If the Justice Department and the State Department make the right inquiries, these people in the Venezuelan government will be made to hurt economically,” Perez said.
History Of Hiding
Pedro Martinez-Fraga, managing partner of Bryan Cave in Miami, agrees. He has two cases against the government of Venezuela and has spent considerable time identifying assets of the Venezuelan government and officials in the United States.
Martinez-Fraga sued Venezuela in the Southern District of Florida two years ago on behalf of wealthy Venezuelan businessman Nelson Mezerhane, who allegedly had more than $1 billion in assets seized by the Venezuelan government. The case was dismissed and is on appeal. Martinez-Fraga also has a $200 million arbitration demand pending against Venezuela with the International Centre for Settlement of Investment Disputes alleging the expropriation of hotels.
In previous dealings with cases involving Chile and its leaders, lawyers learned, “There are clear patterns of government officials secreting assets,” said Martinez-Fraga.
“In the case of Chile, the assets ended up in Miami, Washington, D.C., and New York,” he said. “They are stealing from the Chilean people and sheltering those funds in offshore assets. It’s a fairly demonstrable fact in Venezuela, too.”
Interestingly, Venezuela defends lawsuits and arbitrations vigorously, hiring teams of lawyers from Shearman & Sterling’s Washington office, Martinez-Fraga said.
“They pay these lawyers very handsomely even though the people of Venezuela are suffering,” he said.
Shearman & Sterling did not return calls for comment by deadline.
Daniel Vielleville, president of the newly formed Venezuelan American National Bar Association, opposes the proposed sanctions, calling them “a political move.” He said he was not speaking officially for VENAMBAR, only his personal views.
“This is a very political move by the Florida representatives and senators,” Vielleville said. “They know that doing these measures will be popular with the Cuban vote in Miami. But the impact will be to alienate Venezuela more. This is better in the hands of the State Department than in the hands of elected officials.”
He believes the sanctions will be ineffective since Venezuelan officials likely have their funds secreted in Switzerland. He expects the country’s president, vice president, minister of internal affairs and minister of defense would be among those on the “blacklist.”
“If they have money, it’s in Switzerland and other places,” he said. “They really work with straw men. It’s very well known.”
Congress would be better served by going after Venezuela-owned companies like Petróleos de Venezuela S.A, the country’s oil production company which owns Citgo, Vielleville said. However, no officials have proposed banning oil imports from Venezuela.
The biggest effect of the sanctions could be to block relatives of Venezuelan government officials “from visiting Disney World,” Vielleville said.
“That and the bad reputation associated with this,” he said.