So we will simply try to get through it and I will attempt to monitor it. All eyes are on Venezuela right now, and Venezuela's effect on the Caribbean countries from energy to trade and other things are really worrying, especially Eastern Caribbean countries. So, I guess the question that I have is, all 6 countries of the Company of Eastern Caribbean States are members of the Bolivarian Alliance called ALBA, that includes efforts to promote local cooperation and alleviate hardship; so to what level have ALBA and Petrocaribe increased Venezuela's influence in the Caribbean? I think I can answer that concern greatly.
Mr. Farnsworth. Mr. Chairman, thank you. And I agree Check out this site it is the pregnant problem if you will of the region. Venezuela is a country that is in collapse. Economically, some are stating it is no longer a democracy. It is a country that has serious and long lasting 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 become strained, because the largesse that Venezuela has actually been able to frankly distribute or to provide a concessionary on concessionary terms has been much constrained in the existing environment.
I think what I would say is in the existing environment, because of the troubles that Venezuela is having and honestly since of the chances that we have in the United States through the whole transformation of energy that we have actually seen in our own nation over the last numerous years, we have an opportunity to come into the Caribbean as a partner and say, look, you understand the programs and the activities that you may have been making with Venezuela are no longer relevant and we can supply the exact same things that you require without the political or without the ideological overhang that you may have had formerly - What does finance a car mean.
Duncan. Let me ask you something about that. Exists enough trust of the United States for us to step into that space with those countries? I do not understand the response to that. Mr. Farnsworth. Well, I think in the existing environment we need to do some groundwork. We need to do some spade work. I imply, look, Petrocaribe was a why are timeshares a scam very successful program and we understand why. I mean, it was prompt, it supplied something that the leaders required when they needed it. It was symbolic. It was really, really easy to explain to people. I imply, we are getting oil from Venezuela.
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It was on one problem. And I think often, when the United States engages with the nations of the Caribbean, we have a great deal of well indicating programs and fantastic concepts, but they are watered down, right? Not misguided, but watered down in terms of the effort and the focus. Under Petrocaribe, it was one item quickly discussed, extremely symbolic, and individuals stated Venezuela's our buddy - How to finance a private car sale. And I think what we require to do much better from the United States' point of view is to develop that level of trust through a continuous continual engagement with the region so that individuals can state, look, we do trust you. What happened to household finance corporation.
Mr. Duncan. I personally think energy is a fantastic opportunity for us, no doubt about that. Let me look into money laundering and terrorism financing a bit. There is a huge push by the U.S. to have U.S. banks sever relationship with Caribbean-based banking organizations. Does that policy work to minimize cash laundering and chances 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, due to the fact that when U.S. banks vacate the region what you have actually created in fact is a void which ends up being filled by other institutions.
So, what is being produced is a scenario where there is more chance for terrorist funding or something to go incorrect and somebody to exploit that space. So I would state that the U.S. banks absolutely require to be a key and crucial player in the regional cash system. Mr. Duncan. I am probably less concerned, and perhaps I shouldn't be, however less worried about terrorism financing through the Caribbean monetary organizations as I am about cash laundering. The trend in campaign finance law over time has been toward which the following?. We just saw in Panama, a big $800 million cash laundering scheme, realty participation, huge variety of workers associated with a legitimate service-- still a cash laundering plan.
Ms. Yearwood. Part of the problem is the perception of danger versus the reality of the danger. Banks are not leaving the Caribbean due to the fact that there is cash laundering. Banks are leaving the Caribbean because the costs of compliance are extremely stacked against the banking system. You have little jurisdictions and for every single account that you are handling you have to put a huge quantity of cash into ensuring that the expense of-- that business is tidy. However what we have to do in impact is produce a system where the regulators, the banks, everyone is collaborating, details is being shared, and when information is passed between the regulators and the Treasury or the regulators and the banks, people know where deep spaces are.
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And the problem in the Caribbean is that the economies are small, putting these systems in place costs a lot, however all the Caribbean will tell you that they satisfy the compliance regulations. And so there is a detach in between what is actually happening and what individuals are stating is taking place. I think one of the typical problems is the breakdown between what is going on in offshore monetary services and what is going on in banking. And the Panama Papers were very mostly linked to the offshore monetary services market versus the reporter banking and de-risking concern that is presently being dealt with.
Mr. Duncan. I am assuming that the Federal Government is monitoring-- in Panama Documents a person is never linked because and begin moving monetary resources around, in possibly, the Caribbean country. I am presuming our Treasury and FBI are keeping an eye on that, I would presume. So I am going to go on and yield to the ranking member. Mr. Sires. Among the factors 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 purpose. You understand, if you take a look at the votes they took at the U.N.
So now Venezuela is in trouble. I think their production is something like 40, half less, and there is a void there that we can assist fill and, you understand, we can really assist in regards to just having a bit more influence on people. 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 simply questioning how much of a competitive downside this puts us when we don't have, actually, an existence in the Eastern Caribbean.