Despite interest in the opening-up of trade relations in Cuba, many banks in South Florida and the U.S. are hesitating to jump into business there. Concerns include the cost of compliance for processing transactions, Cuba's status as a country on the list of nations sponsoring terrorism and the vagueness of doing business in the region.
U.S. banks will eventually be allowed to maintain correspondent accounts at financial institutions in Cuba and conduct authorized transactions for authorized parties. However, attorney Andres Fernandez said the cost of compliance for banks processing transactions is simply too high right now.
"The issue is two things for processing credit and debit card transactions: You need a person to be in Cuba and you need the person to be there for an authorized reason. The issue becomes magnified when banks may be required to do due diligence to make sure that person is authorized. The regulations appear to permit banks to rely on the traveler for compliance with this authorization, but this 'safe harbor' is not absolute," he said.
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