Discover Card Joins Wells Fargo, Citibank & ABA With Unsettling Statements About Cuba Transactions

On 22 November 2016, Riverwoods, Illinois-based Discover Financial Services provided the following response in reply to questions submitted by the U.S.-Cuba Trade and Economic Council:

"Discover Financial Services (NYSE: DFS) is a direct banking and payment services company with one of the most recognized brands in U.S. financial services. Since its inception in 1986, the company has become one of the largest card issuers in the United States. The company issues the Discover card, America's cash rewards pioneer, and offers private student loans, personal loans, home equity loans, checking and savings accounts and certificates of deposit through its direct banking business. It operates the Discover Network, with millions of merchant and cash access locations; PULSE, one of the nation's leading ATM/debit networks; and Diners Club International, a global payments network with acceptance in more than 185 countries and territories."

"Thanks for reaching out. Discover, together with our acquiring partners, is evaluating plans to support card acceptance in Cuba."  [NOTE: "An acquiring partner is an entity that we work through to gain acceptance for Discover at certain merchants."]

The response was to the following question:

In 2015, the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury re-authorized United States financial institutions to have their branded charge cards, credit cards and debit cards valid for use in the Republic of Cuba.

In 2015, New York, New York-based MasterCard International removed is restriction for the Republic of Cuba upon its branded products for use by individuals subject to United States jurisdiction.  An agreement was then reached with the Central Bank of the Republic of Cuba to implement the authorization.  There are more than 10,000 POS locations in the Republic of Cuba.

Since that time, Pompano Beach, Florida-based Stonegate Bank, San Juan, Puerto Rico-based Banco Popular de Puerto Rico, and Hollywood, Florida-based Natbank have authorized their MasterCard branded credit cards and debt cards for use in the Republic of Cuba.

In 2016, Stamford, Connecticut-based Starwood Hotels & Resort Worldwide (a subsidiary of Bethesda, Maryland-based Marriott International) began accepting United States-issued MasterCard products at its property in the Republic of Cuba, the Sheraton Four Points Habana.  The company has two more properties soon to be operational.

What is the current position of Discover with respect to authorizing its branded products for use by individuals subject to United States jurisdiction who visit the Republic of Cuba?

Wells Fargo Is Circumspect Regarding Cuba Transactions; Joining Citibank & ABA
November 16, 2016

San Francisco, California-based Wells Fargo & Company provided the following answer to a question relating to transactions with the Republic of Cuba:

[The U.S.-Cuba Trade and Economic Council] would appreciate learning the policy for Republic of Cuba-related transactions and the reason(s) for the policy(s).

“Wells Fargo considers processing a payment which is authorized under U.S. sanctions regulations on a case by case basis.”

"Wells Fargo & Company (NYSE: WFC) is a diversified, community-based financial services company with $1.9 trillion in assets. Founded in 1852 and headquartered in San Francisco, Wells Fargo provides banking, insurance, investments, mortgage, and consumer and commercial finance through more than 8,600 locations, 13,000 ATMs, the internet ( and mobile banking, and has offices in 42 countries and territories to support customers who conduct business in the global economy. With approximately 269,000 team members, Wells Fargo serves one in three households in the United States. Wells Fargo & Company was ranked No. 27 on Fortune’s 2016 rankings of America’s largest corporations. Wells Fargo’s vision is to satisfy our customers’ financial needs and help them succeed financially. In 2015, Wells Fargo donated $281.3 million to 16,300 nonprofits, ranking No. 3 on the Chronicle of Philanthropy’s rankings of the top corporate cash philanthropists. Wells Fargo team members volunteered 1.86 million hours in 2015, serving more than 40,000 nonprofits. Wells Fargo’s corporate social responsibility efforts are focused on three priorities: economic empowerment in underserved communities, environmental sustainability, and advancing diversity and social inclusion."

Citibank Declines To Comment On Processing Cuba Transactions
November 08, 2016

New York, New York-based Citibank (a subsidiary of New York, New York-based Citigroup) declined to comment when asked the following questions relating to transactions with the Republic of Cuba:

Does Citibank process Republic of Cuba-related transactions where a specific license is not required from the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury?

Does Citibank only process transactions where a license is required and provided to Citibank?

ABA Has No "Formal Position" About Cuban Banks Having Accounts With US Banks
November 08, 2016

Today, the Washington, DC-based American Bankers Association (ABA), stated that the organization does not have a formal position relating to the authorization of Republic of Cuba government-operated financial institutions to have accounts with United States-based financial institutions for correspondent activities.  The ABA did not provide a reason(s).

"The American Bankers Association is the united voice of America’s hometown bankers- small, regional and large banks that together employ more than 2 million people, hold more than $16 trillion in assets, safeguard $12 trillion in deposits and extend more than $8 trillion in loans.

ABA believes that government policies should recognize the industry’s diversity. Laws and regulations should be tailored to correspond to a bank’s charter, business model, hometown markets and risk profile. This policymaking approach avoids the negative economic consequences of burdensome, unsuitable and inefficient bank regulation.

Through a broad array of information, training, staff expertise and other resources, ABA supports America’s hometown bankers as they perform their critical role as drivers of America’s economic growth and job creation."

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