Today, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Horacio Manuel Cartes Jara (Cartes), the former President of Paraguay, and Hugo Adalberto Velazquez Moreno (Velazquez), the current Vice President, for their involvement in the rampant corruption that undermines democratic institutions in Paraguay. OFAC is also designating Tabacos USA Inc., Bebidas USA Inc., Dominicana Acquisition S.A., and Frigorifico Chajha S.A.E., for being owned or controlled by Cartes. These individuals and entities are being designated pursuant to Executive Order (E.O.) 13818, which builds upon and implements the Global Magnitsky Human Rights Accountability Act and targets perpetrators of serious human rights abuse and corruption around the world. Today’s action follows the visa restrictions imposed on Cartes and Velazquez in 2022 under Section 7031(c) of the Department of State, Foreign Operations, and Related Programs Appropriations Act, 2022, supporting a whole-of-government approach to combatting corruption and illicit finance. Velazquez, the current Vice President of Paraguay, has also engaged in corrupt practices to interfere with legal processes and protect himself and criminal associates from criminal investigations, including by bribing and threatening those who could expose his criminal activity.
Cartes and Velazquez both have ties to members of Hizballah, an entity designated by the U.S. Department of State as a Foreign Terrorist Organization and the target of multiple OFAC designations. Hizballah has regularly held private events in Paraguay where politicians make agreements for favors, sell state contracts, and discuss law enforcement efforts in exchange for bribes. Representatives of both Cartes and Velazquez have collected bribes at these meetings.
Velazquez is being designated pursuant to E.O. 13818 for being a foreign person who is a current or former government official, or a person acting for or on behalf of such an official, who has engaged in, corruption, including the misappropriation of state assets, the expropriation of private assets for personal gain, corruption related to government contracts or the extraction of natural resources, or bribery.
On December 23, 2016, the President signed the Global Magnitsky Human Rights Accountability Act (Pub. L. 114-328, Title XII, Subtitle F) (the “Act”) into law. The Act authorized the President to impose targeted sanctions on any foreign person the President determines is, among other things, responsible for extrajudicial killings, torture, or other gross violations of internationally recognized human rights, or a government official, or a senior associate of such an official, responsible for, or complicit in, ordering, controlling, or otherwise directing, acts of significant corruption.
On December 20, 2017, the President, invoking the authority of, inter alia, the International Emergency Economic Powers Act (50 U.S.C. 1701-1706) (IEEPA), issued Executive Order 13818 (82 FR 60839, December 26, 2017) (E.O. 13818), effective at 12:01 a.m. eastern standard time on December 21, 2017.
In E.O. 13818, the President determined that serious human rights abuse and corruption around the world constitute an unusual and extraordinary threat to the national security, foreign policy, and economy of the United States and declared a national emergency to deal with that threat.
OFAC is issuing the Global Magnitsky Sanctions Regulations, 31 CFR part 583 (the “Regulations”), to implement the Act and E.O. 13818, pursuant to authorities delegated to the Secretary of the Treasury in E.O. 13818. A copy of E.O. 13818 appears in appendix A to this part.
