So we will just attempt to make it through it and I will try 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 worrying, particularly Eastern Caribbean nations. So, I guess the question that I have is, all six nations of the Organization of Eastern Caribbean States are members of the Bolivarian Alliance understood as ALBA, which consists of efforts to promote regional cooperation and alleviate hardship; so to what extent have ALBA and Petrocaribe increased Venezuela's influence in the Caribbean? I think I can answer that concern enormously.
Mr. Farnsworth. Mr. Chairman, thank you. And I agree it is the pregnant issue if you will of the area. Venezuela is a Helpful site country that remains in collapse. Financially, some are stating it is no longer a democracy. It is a nation that has severe and long lasting internal problems which it is going to take years to get beyond. Therefore, the relationship that Venezuela has developed with a number of countries of the Caribbean in good times has become strained, since the largesse that Venezuela has actually been able to honestly give away or to offer a concessionary on concessionary terms has actually been much constrained in the current environment.
I think what I would say is in the current environment, since of the difficulties that Venezuela is having and frankly since of the chances that we have in the United States through the whole transformation of energy that we have seen in our own country over the last a number of years, we have a chance to come into the Caribbean as a partner and say, look, you understand the programs and the activities that you cancel timeshare after rescission period might have been making with Venezuela are no longer appropriate and we can offer the same things that you need without the political or without the ideological overhang that you may have had formerly - How to finance an investment property.
Duncan. Let me ask you something about that. Exists enough trust of the United States for us to enter that void with those countries? I do not know the response to that. Mr. Farnsworth. Well, I believe in the present environment we need to do some groundwork. We require to do some spade work. I suggest, look, Petrocaribe was a really effective program and we comprehend why. I mean, it was timely, it supplied something that the leaders required when they needed it. It was symbolic. It was really, extremely easy to discuss to people. I indicate, we are getting oil from Venezuela.
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It was on one concern. And I believe in some cases, when the United States engages with the nations of the Caribbean, we have a lot of well implying programs and wonderful ideas, however they are watered down, right? Not deluded, but diluted in regards to the effort and the focus. Under Petrocaribe, it was one item easily described, extremely symbolic, and people said Venezuela's our buddy - What is a consumer finance account. And I believe what we require to do much better from the United States' point of view is to construct that level of trust through a continuous sustained engagement with the area so that people can say, look, we do trust you. How old of a car will a bank finance.
Mr. Duncan. I personally think energy is a fantastic chance for us, no doubt about that. Let me dive into money laundering and terrorism funding a bit. There is a huge push by the U.S. to have U.S. banks sever relationship with Caribbean-based banking institutions. Does that policy work to lower money laundering and opportunities for terrorist organizations to access the monetary system? And that is probably to Sally. Ms. Yearwood. In a lot of ways it does the opposite, since when U.S. banks vacate the region what you have actually developed in reality is a space which ends up being filled by other organizations.
So, what is being produced is a scenario where there is more chance for terrorist financing or something to go wrong and someone to exploit that void. So I would say that the U.S. banks definitely require to be an essential and vital gamer in the local money system. Mr. Duncan. I am probably less concerned, and perhaps Go to the website I shouldn't be, however less concerned about terrorism funding through the Caribbean financial organizations as I have to do with cash laundering. Which of the following can be described as involving direct finance. We just saw in Panama, a huge $800 million cash laundering plan, real estate involvement, big number of employees involved in a legitimate organization-- still a cash laundering plan.
Ms. Yearwood. Part of the issue is the perception of threat versus the reality of the danger. Banks are not leaving the Caribbean because there is cash laundering. Banks are leaving the Caribbean since the expenses of compliance are extremely stacked versus the banking system. You have little jurisdictions and for each account that you are handling you have to put a substantial amount of cash into ensuring that the expense of-- that business is tidy. However what we need to carry out in effect is develop a system where the regulators, the banks, everyone is working together, info 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 inform you that they meet the compliance policies. Therefore there is a detach in between what is really occurring and what individuals are stating is happening. I believe one of the common complaints is the breakdown in between what is going on in offshore financial services and what is going on in banking. And the Panama Papers were very largely linked to the overseas financial services industry versus the correspondent banking and de-risking issue that is presently being dealt with.
Mr. Duncan. I am assuming that the Federal Federal government is keeping track of-- in Panama Papers a person is never implicated in that and begin shifting monetary resources around, in possibly, the Caribbean country. I am presuming our Treasury and FBI are keeping an eye on that, I would assume. So I am going to go on and yield to the ranking member. Mr. Sires. One of the factors that I supported, or I still support the export of energy from this nation is to offset the impact of Venezuela since basically they were using it for political purpose. You know, if you 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 help fill and, you understand, we can actually assist in regards to simply having a bit more affect on individuals. The other thing that frets 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 wondering how much of a competitive downside this puts us when we do not have, truly, an existence in the Eastern Caribbean.