U.S. evaluates restricting Visa and Mastercard transactions in Venezuela

The U.S. government is evaluating the possibility of imposing sanctions that would prevent U.S. companies Visa and Mastercard from processing credit card payments in Venezuela, a senior government official who asked for anonymity said.

That action, which is still being studied, would represent one more step in the U.S. economic pressure campaign against Venezuelan ruler Nicolás Maduro.

According to the official, the U.S. has concluded that it has legal authority to restrict transactions in Venezuela with Visa and Mastercard because both companies are based in the U.S. Visa is based in Foster City (California), while Mastercard is located in New York.

In Cuba, the use of Visa and Mastercard cards is restricted due to the U.S. economic embargo and, in fact, they generally only work on the Island if they have been issued by banks outside U.S. territory.

The U.S. has concluded that it has legal authority to restrict Visa and Mastercard transactions in Venezuela because both companies are based in the U.S.

Donald Trump’s government has increased its economic pressure on Maduro in recent weeks with the aim of forcing him out of power and allowing a “transition” led by opposition leader Juan Guaidó, interim president since January 23, supported by 54 countries.

The U.S. was the first country in the world to recognize Guaidó as president and, since then, has taken various actions to pressure Maduro, including the withdrawal of visas for Venezuelan officials and sanctions against Petróleos de Venezuela (PDVSA), the main source of foreign exchange for the state coffers.

This week, U.S. Secretary of State Mike Pompeo met in Washington with his Indian counterpart, Vijay Gokhale, and asked him not to become Maduro’s “economic lifeline” and reduce his purchase of Venezuelan crude oil, which amounts to 300,000 barrels a day.

In addition, the U.S. on Monday sanctioned the Russian bank Evrofinance Mosnarbank for helping the Venezuelan government evade the economic sanctions imposed against Caracas.

Washington also sent a formal notice to all international banks this month to warn them that they will be sanctioned if they finance Maduro.

Another option that the U.S. is evaluating is the imposition of secondary sanctions on those companies that negotiate with Maduro-controlled companies, as Washington did in the case of foreign companies buying oil from Iran.

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