Venezuelan opposition impatient over U.S. process to move frozen funds – sources

By Vivian Sequera and Mayela Armas

CARACAS (Reuters) – Members of Venezuela’s opposition are anxiously awaiting decisions by the United States to again allow the distribution of funds to support opposition legislators and humanitarian efforts, five sources told Reuters.

Under the Trump administration, the United States intensified its sanctions against the South American country. It froze and seized Venezuelan government funds at the U.S. Federal Reserve Bank of New York and then used the funds to support opposition lawmakers who oppose President Nicolas Maduro.

Now, opposition figures are complaining that the U.S. clearance process needed to replace its previous point-person for distribution of funds, the ousted leader Juan Guaido, is stretching on.

Guaido, who represented Venezuela in litigation and in interactions with the U.S. Office of Foreign Assets Control (OFAC), which enforces sanctions, was ousted from his role as interim president in December and replaced in January by three legislators.

New opposition leadership has appointed a committee to take over management of foreign assets – including the frozen funds in the U.S. – but the committee is subject to a complex U.S. clearance process even though the United States has said repeatedly it supports the opposition leadership.

“The United States promised to give its view about the changes made by the national assembly,” said an opposition source. “While it remains unclear everything is paralyzed. Letters have been sent and the United States says soon and it still hasn’t happened.”

The wait for U.S. approvals is the latest challenge for the fractious opposition, whose new leadership is struggling to gain traction against Maduro amid a loosening of U.S. sanctions and renewed relations with some neighbors.

The United States has long backed the Venezuelan opposition – recognizing its parallel legislature and decrying what it says is Maduro’s dictatorship.

Maduro’s government opposes what it says is U.S. foreign interference in its politics and has said the opposition stole funds that belong to the people that could be used for social and medical support.

The Venezuelan Ministry of Information did not immediately respond to a request for comment on the frozen funds.

Opposition in transition

The new head of the opposition legislature Dinorah Figuera has overseen the appointment of the foreign assets committee.

Venezuela’s foreign assets include Citgo Petroleum, nearly $2 billion in gold at the Bank of England and programs, including payments to opposition activists, using assets in the United States.

“We’re in a moment of transition which preserves national and international legal protection for the funds,” Figuera, from the Justice First party, said when asked about replacing Guaido as manager.

U.S. and European representatives have told members of the opposition that there must be a replacement for Guaido to authorize transfers, according to one source.

“There are people waiting,” another source said, adding the frozen funds aimed at humanitarian aid are vital amid the poverty and income inequality suffered by half of Venezuelans.

Both the Venezuelan opposition and the government are deeply unpopular.

A February poll of 1,200 people by research company Delphos found 65.3% described the Maduro government as “terrible and bad,” while 61.7% of respondents agreed the opposition was “terrible and bad.”

The U.S. government supports the so-called Mesa Social deal between the opposition and the government to use some $3.2 billion – including from Venezuelan accounts in Europe – for humanitarian efforts, a State Department spokesperson said via email.

“We have expressed our high-level support for the Mesa Social agreement,” the spokesperson said. “We regularly consult with the (opposition) on how we can support the Venezuelan parties in implementing this agreement to better meet the humanitarian needs of the Venezuelan people.”

The U.S. Treasury Department, which oversees OFAC, declined to comment.

The opposition is already looking at ways to move small amounts of money to avoid creditors and has held meetings with U.S. authorities in Washington.

(Reporting by Vivian Sequera and Mayela Armas; Writing by Julia Symmes Cobb)