THE Marianas Public Land Trust is requesting the U.S. Department of the Treasury’s Office of Foreign Assets Control to approve the liquidation of MPLT’s accounts in the Central Bank of the Russian Federation or Sberbank that were impounded and subjected to sanctions by the U.S. government on March 1, 2022, in response to the Russian invasion of Ukraine.
Executive Order 14024 authorizes sanctions against Russia for its “harmful foreign activities, including violating core principles of international law such as respect for the territorial integrity of sovereign states.”
In February 2022, the Office of Foreign Assets Control or OFAC imposed sanctions on Sberbank and required all U.S. financial institutions to close their accounts with the bank.
In his letter on Monday, MPLT Chair Philip Mendiola-Long informed OFAC Director Andrea M. Gacki that MPLT has investments in Sberbank.
As of Jan. 9, 2024, Mendiola-Long said, the amount of MPLT’s general fund trust account in the bank totaled $101,154.66, down from its original book value of $198,084.04 while MPLT’s American Memorial Park fund in the bank totaled $12,292, down from $28,408.48.
Mendiola-Long said once they were impounded, MPLT’s accounts, managed by its money manager through investment consultant Raymond James, were required to be placed in segregated stand-alone accounts. This segregation and restricted status, Mendiola-Long said, will remain in place until OFAC allows the removal of the shares so MPLT’s money manager can re-invest the funds.
Mendiola-Long said MPLT recognizes and respects the U.S. authority to impose sanctions on the bank.
However, he said, the impounding of MPLT’s funds “is operating to the detriment of the CNMI” and prevents it from earning interest income from the investments.
For this reason, MPLT is requesting an exemption or license from OFAC for the liquidation or release of MPLT’s funds from Sberbank.
If approved, MPLT will redirect and reinvest those funds in other securities and markets outside the Russian Federation, Mendiola-Long said.
“We realize that MPLT’s request may be no different from other entities whose funds were impounded for good cause determined by the United States. Even so, we respectfully request OFAC’s consideration and approval of the liquidation and exemption for the release of the general fund and park fund accounts,” Mendiola-Long said.
