So we will just try to make it through it and I will attempt to monitor it. All eyes are on Venezuela right now, and Venezuela's effect on the Caribbean nations from energy to trade and other things are extremely concerning, specifically Eastern Caribbean nations. So, I guess the question that I have is, all 6 nations of the Company of Eastern Caribbean States are members of the Bolivarian Alliance known as ALBA, that includes efforts to promote local cooperation and alleviate hardship; so to what degree have ALBA and Petrocaribe increased Venezuela's impact in the Caribbean? I think I can address that question enormously.
Mr. Farnsworth. Mr. Chairman, thank you. And I concur it is the pregnant concern if you will of the region. Venezuela is a country that remains in collapse. Financially, some are saying it is no longer a democracy. It is a country that has extreme and enduring internal problems which it is going to take years to get beyond. And so, the relationship that Venezuela has developed with a variety of nations of the Caribbean in excellent times has ended up being stretched, due to the fact that the largesse that Venezuela has been able to frankly distribute or to provide a concessionary on concessionary terms has actually been much constrained in the present environment.
I think what I would state remains in the existing environment, since of the problems that Venezuela is having and frankly since of the opportunities that we have in the United States through the entire revolution of energy that we have seen in our own country over the last several years, we have an opportunity how to get rid of timeshare maintenance fees to come into the Caribbean as a partner and say, look, you understand the programs and the activities that you might have been doing with Venezuela are no longer pertinent and we can offer the very same things that you require without the political or without the ideological overhang that you might have had previously - What does finance a car mean.
Duncan. Let me ask you something about that. Is there enough trust of the United States for us to step into that void with those nations? I don't understand the response to that. Mr. Farnsworth. Well, I believe in the current environment we require to do some foundation. We need to do some spade work. I imply, look, Petrocaribe was an extremely effective program and we understand why. I suggest, it was timely, it offered something that the leaders required when they needed it. It was symbolic. It was very, very simple to discuss to people. I suggest, we are getting oil from Venezuela.
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It was on one issue. And I believe in some cases, when the United States engages with the nations of the Caribbean, we have a great deal of well indicating programs and terrific ideas, but they are watered down, right? Not deluded, but diluted in terms of the effort and the focus. Under Petrocaribe, it was one product easily explained, extremely symbolic, and individuals stated Venezuela's our friend - What was the reconstruction finance corporation. And I think what we need to do better from the United States' perspective is to build that level of trust through an ongoing sustained engagement with the region so that people can state, look, we do trust you. What jobs can i get with a finance degree.
Mr. Duncan. I personally think energy is a fantastic chance for us, no doubt about that. Let me dive into cash laundering and terrorism financing a bit. There is a big push by the U.S. to have U.S. banks sever relationship with Caribbean-based banking institutions. Does that policy work to decrease money laundering and chances for terrorist organizations to access the financial system? Which is most likely to Sally. Ms. Yearwood. In a lot of methods it does the opposite, due to the fact that when U.S. banks move out of the region what you have produced in reality is a void and that ends up being filled by other institutions.
So, what is being produced is a circumstance where there is more chance for terrorist funding or something to fail and somebody to exploit that space. So I would say that the U.S. banks absolutely need to be an essential and vital gamer in the local money system. Mr. Duncan. I am probably less concerned, and possibly I should not be, however less worried Helpful hints about terrorism financing through the Caribbean financial organizations as I have to do with money laundering. Which of these is the best description of personal finance. We just saw in Panama, a substantial $800 million money laundering scheme, property participation, huge variety of workers involved in a genuine organization-- still a cash laundering scheme.
Ms. Yearwood. Part of the problem is the understanding of risk versus the truth of the threat. Banks are not leaving the Caribbean because there is money laundering. Banks are leaving the Caribbean due to the fact that the costs of compliance are extremely stacked versus the banking system. You have small jurisdictions and for every account that you are dealing with you need to put a substantial amount of cash into making certain that the cost of-- that the companies is clean. But what we have to carry out in impact is develop a system where the regulators, the banks, everyone is collaborating, information is being shared, and when information is passed in between the regulators and the Treasury or the regulators and the banks, people know where the voids are.
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And the problem in the Caribbean is that the economies are small, putting these systems in location costs a lot, however all the Caribbean will tell you that they meet the compliance regulations. Therefore there is a detach between what is in fact happening and what individuals are stating is occurring. I believe one of the common grievances is the breakdown between what best timeshare exit company is going on in overseas monetary services and what is going on in banking. And the Panama Papers were very mainly connected to the overseas monetary services industry versus the reporter banking and de-risking problem that is presently being dealt with.
Mr. Duncan. I am presuming that the Federal Federal government is keeping track of-- in Panama Documents a person is never ever linked because and begin shifting financial resources around, in perhaps, the Caribbean country. I am presuming our Treasury and FBI are monitoring that, I would assume. So I am going to go ahead and yield to the ranking member. Mr. Sires. Among the reasons that I supported, or I still support the export of energy from this nation is to offset the influence of Venezuela because generally they were utilizing it for political function. You know, if you take a look at the votes they took at the U.N.
So now Venezuela remains in problem. I believe their production is something like 40, 50 percent less, and there is a void there that we can assist fill and, you know, we can really assist in regards to simply having a bit more influence on individuals. The other thing that stresses me is that on the eastern part of the Caribbean. Generally, we have an Embassy in Barbados and it serves all those islands there. Meanwhile, you have Venezuela, Cuba, Brazil, they all have an existence there. So I was just questioning just how much of a competitive downside this puts us when we don't have, really, a presence in the Eastern Caribbean.