Visa suspends international transactions made with CIBanco cards

Visa has suspended planetary transactions for cards issued by CIBanco, a Mexican commercialized slope that offers fiscal services to individuals and companies, pursuing allegations of wealth laundering by the Financial Crimes Enforcement Network (FinCEN) of the U.S. Treasury. 

CIBanco, with implicit US $7 cardinal successful assets, confirmed the unilateral determination by Visa, which was announced abruptly connected Sunday and took effect connected Monday afternoon. 

S&P Global Ratings besides terminated its declaration with CIBanco connected Monday and withdrew its ratings data, including the downgrade to “CreditWatch with antagonistic implications” S&P had issued connected Friday.

“We judge CIBanco is successful a precise susceptible concern fixed the consequences that whitethorn originate from FinCEN’s announcement,” the ratings bureau said.

Additionally, Mexican existent property trusts Terrafina and Fibra Inn said they would region lender CIBanco arsenic their trustee, according to Reuters.

CIBanco was among three Mexican fiscal institutions that were sanctioned by the U.S. Department of Treasury past Wednesday and accused of laundering millions of dollars for cause cartels. The sanctions issued prohibit definite transactions with U.S. banks.

Visa not lone suspended each transactions without anterior coordination with CIBanco, but besides did truthful earlier the 21-day play the Treasury Department typically allows for specified actions, according to the mag Expansión.

Mexican authorities takes power of 2 Mexican banks facing US sanctions

The suspension specifically affects CIBanco’s planetary transactions, including those made with the CICash Multicurrency card. CIBanco has stated that lawsuit funds are harmless and tin beryllium reimbursed. 

On Thursday, Mexico’s National Banking and Securities Commission (CNBV) decreed a “temporary managerial intervention” astatine CIBanco aft the FinCEN announcement, saying the determination was aimed astatine protecting the bank’s creditors and depositors.

On Friday, Mexico’s Finance Minister Edgar Amador said the interventions astatine the 3 fiscal institutions “provide certainty” to relationship holders. 

CIBanco issued a akin connection to clients:

“Your funds are harmless and tin beryllium reimbursed done our subdivision web successful the archetypal currency (if available) oregon successful section currency utilizing the method the lawsuit chooses,” it said.

S&P is not truthful bullish, however. According to the ratings agency, determination is simply a hazard that the slope volition not beryllium capable to entree fiscal transfers with U.S. and home institutions, which would bounds the sustainability of the concern implicit the adjacent 12 months.

S&P warned that CIBanco’s profitability and superior levels could besides beryllium weakened fixed the contraction successful revenue.

CIBanco was primitively established successful 1983 arsenic Consultoría Internacional (CI), a currency speech house. It aboriginal transformed into a aggregate banking instauration successful 2008.

With reports from Expansión, La Jornada, Infobae, Reuters and Milenio