CubaBrief: Cuban regime turns to advice from Russian oligarch. The Cuban oligarchs among us. Castro dictatorship taken to London’s High Court to pay past debts

Castro regime’s consigliere and emerging oligarch, Dr. Rodolfo Dávalos Fernández

The Castro regime’s oligarchs are emerging, and the dictatorship is openly seeking advice from Russia on how to replicate their model of enriching a well-connected few while impoverishing the many. According to Nora Gámez Torres of The Miami Herald, in her article Cuba wants Russia’s advice on market reforms as Putin seeks more trade with the island, “the Cuban government is turning to Russia for help with market reforms on the island through a partnership with a Russian think tank headed by sanctioned oligarch Oleg Deripaska.”

This news comes on the heels of the January 23rd announcement that Charles McGonigal, “a former high-ranking FBI counterintelligence official who investigated Russian oligarchs has been indicted on charges he secretly worked for one, in violation of U.S. sanctions.” The U.S. Department of Justice arrested “two businessmen, Vladislav Osipov, 51, a Russian national, and Richard Masters, 52, a United Kingdom national” on January 20th and charged them with “facilitating a sanctions evasion and money laundering scheme in relation to the ownership and operation of”… “a $90 million, 255-foot luxury yacht owned by sanctioned Russian oligarch Viktor Vekselberg.”

When attempting to avoid paying debts, sanctions evasion and money laundering come in handy. As Mr. Putin has demonstrated in Russia, concentrating wealth in the hands of a few within the government or closely connected to those in the regime is an effective means of maintaining political power. Cuba already has crony capitalism for the well-connected regime elites and communism for the poor, but it seeks to perfect it with Moscow’s help. Unfortunately, the Castro regime also has crony capitalists in the United States all too willing to help, and their Cuban counterparts are already there ready to meet with them.

Rodolfo Dávalos León is a Cuban national living in the United States who founded Caribbean Ventures Management LLC, a company incorporated in the state of Delaware in 2016, but headquartered in Coral Gables, Miami.  When protests erupted across Cuba on July 11, 2021, and the dictatorship’s future was in doubt, Mr. Dávalos León tweeted out “If the revolution falls you will find me in Cuba, with my father, knee on ground, rifle in hand, defending the work of Fidel. Long live Cuba, long live Raul, and long live Fidel!” 

Naturally, a few questions will arise. Has the FBI investigated what he is doing? In addition, who is his father? Has he registered as an agent of a foreign principal?

According to publicly available photos, he met with Ben Rhodes in Coral Gables and U.S. Senator Patrick Leahy in the U.S. Capitol.

His father is a highly placed confidant of Fidel and Raul Castro. According to official records, Dr. Rodolfo Dávalos Fernández is a professor of International Law at the University of Havana and president of the Cuban Court of International Commercial Arbitration.

Cuban independent journalist Ulises Fernández in a July 2021 piece for Cubanet filled in some of the gaps in the professor’s official record. Dr. Dávalos Fernández was present in  “every international litigation that involved the Cuban government as defendant, plaintiff, summoned party, or even referenced entity, in matters unpleasant in nature, since they always have to do with breach of contracts, frozen bank accounts, confiscations, accumulated debts, fraudulent practices against businessmen, blackmail, espionage and psychological manipulation…”

The Cuban dictatorship is engaged in “a high-stakes legal battle in London’s High Court” in order to avoid paying “72 million euros ($78.18 million) on two loans” granted in the 1980s.  The Castro regime is being represented by a deep bench of attorneys, however one name stands out.  According to the regime’s official media Dr. Dávalos Fernández, is “playing an essential role in the legal strategy of the case, and has extensive experience in international litigation.”

It is not mentioned that he is one of the patriarchs of the new Cuban oligarchy, with his children enjoying lucrative lifestyles in private companies in the United States and Spain.

Dr. Rodolfo Dávalos Fernández with his daughter Lourdes Dávalos León

Rodolfo Dávalos León, who is based in Coral Gables, has already been mentioned. Let us now turn our attention to his sister, Lourdes Dávalos León, an attorney based in Spain and a social influencer with a penchant for Louis Vuitton handbags and the finer things in life. She accompanied her father to the ongoing legal battle in London’s High Court. Video emerged highlighting their visit to the United Kingdom.

If the Biden Administration believes that these “entrepreneurs” will be agents of a democratic transition in Cuba, it is delusory. More likely, they will be agents of corruption in the United States, Europe, and elsewhere, seeking to undermine the rule of law and democracy, as their Russian counterparts are.

The Miami Herald, January 25, 2023

Cuba wants Russia’s advice on market reforms as Putin seeks more trade with the island

By Nora Gámez Torres

Sergey Guneev/AP

After much hesitation about how to deal with small and medium-sized private enterprises it authorized in 2021, the Cuban government is turning to Russia for help with market reforms on the island through a partnership with a Russian think tank headed by sanctioned oligarch Oleg Deripaska, as the two countries vow to take their relationship to “a new level.”

[…]

Both Russia and Cuba are under U.S. sanctions, and Cuban authorities have parroted the Kremlin’s propaganda about the war in Ukraine while failing to condemn Putin in international forums. The two governments also maintain close military ties.

But experts point to the irony of Cuba’s seeking guidance on capitalist reforms from Russia, a country plagued with corruption and an economy driven by oligarchs seeking the Kremlin’s favors.

“They are seeking help from a government that knows how to make money and create a private sector that has a lot of money concentrated in a few hands, and wealth derives from connectivity to the government,” said John Kavulich, the president of the U.S.-Cuba Trade and Economic Council. “The Russian Federation has some very wealthy people. Perhaps the Cuban government prefers it that way.”

[…]

[ Full article ]

 

https://www.miamiherald.com/news/nation-world/world/americas/cuba/article271592032.html

Reuters, January 23, 2023

Cuba Begins London Court Battle Over Unpaid Castro-Era Debt

Jan. 23, 2023, at 2:10 p.m.

High Court of London

By Marc Jones | Reuters

LONDON (Reuters) – Cuba began a high-stakes legal battle in London’s High Court on Monday over unpaid Fidel Castro-era government debt now held by one of the communist-run country’s creditors.

The 8-day case will be closely watched by other creditors who between them have struggled to recoup an estimated $7 billion of defaulted loan from Havana.

CRF I Ltd, the investment firm that brought Monday’s case, says it is owed 72 million euros ($78.18 million) on two loans that were originally granted to Cuba by European banks in the 1980s and denominated in German Deutschmarks. 

    Cuba’s authorities have labelled CRF a “vulture fund” and said in their legal argument ahead of the case that the English Court had “no jurisdiction” to try CRF’s claims.

CRF originally launched the claim almost three years ago after Havana refused a debt relief offer made by CRF and some other bond holders back in 2018.    

    “We are still ready to talk to the other side – even at this late stage,” CRF Chairman, David Charters, told Reuters.

    The communist-run island has seen its finances deteriorate badly in recent years, made worse by the coronavirus pandemic and restrictions put in place by former U.S. President Donald Trump.

    In 2015, Havana reached a deal with members of the Paris Club of creditor nations that saw roughly three-quarters of that debt written off. But having not dealt with its commercial creditors in the so-called London Club the country remains shut out of international capital markets.

    “The BNC and Cuba have never ignored their debts and have always maintained their interest in negotiating with their legitimate creditors,” the Cuban central bank said in a statement ahead of the case earlier this month.

    Other Latin American nations, most notably Argentina, have also fought prolonged court and political battles for years to settle with international funds that bought up defaulted-debt cheaply and then pursued legal claims.

($1 = 0.9210 euros)

(Reporting by Marc Jones and Sam Tobin; Editing by Frank Jack Daniel)

Copyright 2023 Reuters.

https://www.usnews.com/news/world/articles/2023-01-23/cuba-begins-london-court-battle-over-unpaid-castro-era-debt


In case you missed it

Cubanet, July 21, 2021

The Dávalos Family: The Devil’s Advocates?

Nothing out of the ordinary should be perceived in the generosity or empathy of this Cuban resident of the United States toward his peers inside Cuba

Ulises Fernández

miércoles, 21 de julio, 2021 12:08 pm

HAVANA, Cuba. – Caribbean Ventures Management LLC is a company founded by Rodolfo Dávalos León and incorporated in the state of Delaware in 2016. It is headquartered in Coral Gables, Miami, according to the company’s public reports.

It is a small business that, as suggested by the word “venture”, implies a risk, an adventure, dating to the period between 2014 and 2017 when a few people became enthusiastic about the prospects that Cuban socialism had, at long last, conquered the hearts of some on Capitol Hill and even in the White House.

It has been said that Rodolfo Dávalos founded the company as a favor to a group of young Cubans, some of them graduates of the University of Computer Sciences (UCI, by its Spanish acronym) in Havana, who were among the few entrepreneurs invited to the U.S. Congress between 2016 and 2017. Judging from press photos published about said meetings, which were promoted by the Obama Administration, no peanut street vendor, or 1950’s-antique-car driver, or bicycle-taxi operator –possibly the most genuine representatives of individual entrepreneurship in the heart of Cuba- came to those meetings.

Caribbean Ventures does not promote itself as a large company, but, if we keep in mind that its main objective is the search and management of gastronomic services in Cuba, then we can see the relative success achieved by its main product: a mobile phone APP that today boasts of about 50,000 clients worldwide.

It is noteworthy that AlaMesa is a Cuban application and platform developed in Cuba with Android and iOS versions. It has been highly praised in Granma, the official daily, which has dedicated long promotional reports to it (much to the surprise and anger of its most orthodox readers who are not accustomed to this choice of topic in the official outlet of the Cuban Communist Party). It has also been praised by The New York Times and Forbes Magazine, a feat that would not have been possible were it not for the endorsement of this Cuban young man who resides in Miami, Rodolfo Dávalos León, and has been “godfather” to several independent projects generated from inside the island.

Nothing out of the ordinary should be perceived in the generosity or empathy of this Cuban resident of the United States toward his peers inside Cuba, especially because, on his social media profiles -which were public until recently but are today either private, inactive, or have vanished- he reveals how much he loves the American way of life.

What does this charismatic, 32-year-old young man really do that is different, notable and even rare if compared to any other Cuban American? Perhaps the answer is in his family name.

Dávalos, Luis Alberto López Calleja Dávalos with Bruno Rodríguez in DC   Rodolfo Dávalos next to Díaz-Canel 

Dávalos, a brand more than a surname

If, in exercising his or her rights as legitimate owner of confiscated property, someone today filed a claim against a foreign corporation doing business in Cuba because that corporation is profiting from said confiscated property, he or she will come up repeatedly with a specific surname in all the paperwork that the lawsuit generates for as long as it lasts.

As such, the Dávalos surname will come up in texts on commercial law and legal counseling as well as on the letterhead of hundreds of memos and documents produced in the course of the complex proceedings at arbitration courts.

Keep in mind that the surname which comes up the most is that of Rodolfo Dávalos Fernández, who presides over the Cuban side that handles these matters for the Cuban Chamber of Commerce, and has even practiced before the Court of Arbitration in Paris. His daughter, Lourdes Dávalos León, is in charge of the Cuba archive at one of the principal law offices in Madrid, offering legal advice to businessmen, be they European or not, looking to invest in the Caribbean island.

As we have seen, there are other Dávalos playing the same field, whose principal operations are headquartered in Europe, Cuba and the United States.

This coincidence could lead some to ask themselves if young Rodolfo Dávalos León, Lourdes’ brother, could have served as intermediary between the Cuban government and groups of businessmen and politicians who favor an understanding and an exchange between the government in Havana and the U.S. government.  We don’t know. However, it is curious that he was very active a couple of years back as an investment analyst, or as intermediary, during the time Barack Obama started the thaw of relations with Havana.

Even his career, at least in the United States, began to excel a few years before, although focused primarily on what was to happen that December 17, 2014, as if he had presaged or calculated it.

Dávalos, that surname turned obligatory reference brand for politicians and foreign investors interested in Cuba, also is familiar, although not too much so, to law students at the University of Havana during the last four decades. It is also known to anyone who remembers every international litigation that involved the Cuban government as defendant, plaintiff, summoned party, or even referenced entity, in matters unpleasant in nature, since they always have to do with breach of contracts, frozen bank accounts, confiscations, accumulated debts, fraudulent practices against businessmen, blackmail, espionage and psychological manipulation, as was the case of Elián González.

Rodolfo Dávalos Fernández served as counsel in the first major foreign investment operation that took place in Cuba at the end of the 1980s. It involved the construction of over 1,400 guest rooms in 4 and 5 star hotels in Varadero, plus 200 bungalows, golf courses and a residual water-treatment system by the Spanish corporate group Meliá.

Later, Dávalos Fernández would become assistant director of Meliá-Cuba, as well as personal attorney to Spanish businessman Enrique Martinón, and helped set up off-shore companies in Panama and in Europe. Not surprising, then, that his name, associated with the Mossack Fonseca law firm, was among the first to surface when the Panama Papers scandal broke.

His name appears, also, in several commercial registries in Panama, as director and secretary of Oceanic Estates S.A. and Arsia International S.A., the latter registered in 1987 (Folio number 186543 by resident agent Morgan & Morgan) and linked to Italian Mauro Casagrandi, who served as ambassador of the Order of Malta in the 1980s and is said to have worked as a double agent of Cuba’s secret service (“Mauro Casagrandi Double Agent for Cuba, page 170”) until he broke with the regime in the early 1990s.

In the course of this practically-uninterrupted time line, up until today, Dávalos Fernández has led the legal teams in several cases: in the case of the five Cuban intelligence agents –the Wasp Network- found guilty of espionage in the U.S.; in the dispute against Chilean businessman Max Marambio (El Mercurio, Chile, July 26, 2013) and his company Río Zaza; as well as in the famous case of Elián González. In an interview on Cubasí, dated March 26, 2013, Dávalos Fernández stated that: “The ‘Five’, Elián, the blockade, they are all revolutionary causes to which I have dedicated a considerable part of my life; they are causes of the Fatherland.”

(Part I of an investigative report conducted by journalist Ulises Fernández. To read the entire report, please press here)

Read in Spanish here.

https://www.cubanet.org/english/the-davalos-family-the-devils-advocates/

Cubanet, July 23, 2021

More about the Dávalos Family: “Daddy Paved the Way”

Every time we set out to research information from the last thirty years about a given litigation or an important case involving the Cuban regime and international law, the name Rodolfo Dávalos Fernández will come up in a second. If not his, then the name of some relative.

Ulises Fernández

, 23 de julio, 2021

HAVANA, Cuba. – Every time we set out to research information from the last thirty years about a given litigation or an important case involving the Cuban regime and international law, the name Rodolfo Dávalos Fernández will come up in a second. If not his, then the name of some relative.

A Juris Doctor; a full professor of international private law at the University of Havana; a National Law Award recipient in 2012; and president of the Cuban Arbitration Court (CCACI, by its Spanish acronym) since its founding in 2007, 78-year-old Rodolfo Dávalos Fernández served as arbiter for the Civil and Commercial Court (CIMA, by its Spanish acronym) in Madrid, and for the International Arbitration Court in Paris. He has been much more than just an expert to Fidel Castro and to Raúl, but a right-hand man and counsel who is at the very core of the complex economic web of the Castros, a web he knows to perfection, like no other attorney.

As legal counsel of Cubanacán, S.A. –which was headed by Abraham Maciques, another of Fidel Castro’s right-hand men- Rodolfo Dávalos became, in a short time, the personal attorney to Enrique Martinón; in the early 1990s, he became Assistant Director of the Meliá hotel chain in Cuba. He was also the chief counsel for the Spanish company’s negotiations with China, which shows the trust that Meliá’s president Gabriel Escarrer placed on his business acumen.

The daughter

Located in Madrid is one of the most important law offices in Europe: Uría Menéndez, specialists in commercial law. Their office is the obligatory firm where any foreign businessman must go if he/she wishes to invest in Cuba. Among Uría Menéndez’s clients we find the Meliá hotel chain, and many other foreign companies who have bet on the opportunities at the Mariel Special Development Zone, as well as the British owners of Esencia Hotel and Resort, who shall build The Carbonera Club, the first exclusive resort in Cuba that will boast of a world class golf course.

It is at Uría Menéndez that Lourdes Dávalos León has her office; she is classified by the firm as “Star Associate”.

How was young Lourdes able to be admitted to such an important law firm in 2007, fresh out of law school and with no experience in practicing the profession? The answer is as mysterious as is the true story of how she managed –or someone managed for her- to validate her degree in Europe, when José Luis Toledo Santander, the now President of the Constitutional and Judicial Affairs Commission of Cuba’s National Assembly of People’s Power refused to do so, most likely because he knew nothing about “special plans” that were above and beyond his understanding as mere Dean of the Law School.

“That is a real mystery,” remembers a witness to those events, a professor of the University of Havana Law School: “she was Dr. Dávalos’ daughter, and no one expected that Toledo would behave so intransigently (…), I know there was a confrontation that forced Rodolfo to use all his influence, which is greater and more powerful than Toledo’s, even with his parliamentary position, it doesn’t measure up to Rodolfo’s (…). He even managed to get her exempted from the required social service, which shows even the most naïve individual that higher interests were at stake (…), evidently, they were desperate for her to graduate so they could send her to Madrid as urgently as possible, because it had to do with companies, contracts, bank accounts, all of which are a mystery to everyone and Rodolfo is the custodian of all this which requires discretion, loyalty and trust, and that explains why the structure is the family’s purview, a gargantuan scheme where secrets are passed down from parents to offspring (…). That explains why the arbitration court and the law firm in Madrid (…) are in the hands of the same family (…), (Lourdes) was a very good student, I won’t deny that, but what’s key is that she was Dr. Dávalos’ daughter, and daddy paved the way,” the professor stated.

The truth be what it may, the reality is that having graduated law school in 2007 –which coincided with the founding of the Cuban Arbitration Court under her father’s leadership- That same year, Lourdes Dávalos moved to Spain to matriculate immediately for a Masters in International Business Law at Universidad Complutense in Madrid. This allowed her to register in a short span (2009) with the Madrid Bar Association (her registration number 100622) and to become a member of the Spanish Arbitration Club, in order to start working at the Madrid law firm Eversheds Lupicinio (her professional track can be found on her Linkedin profile). Eversheds Lupicinio had been in charge of business deals with the Cuban state until Uría Menéndez took over the account. In 2011, only four years after graduation, the firm acquired Lourdes Dávalos as “Principal Associate” responsible for its Cuba Archive and as main expert of legal issues with regard to the Mariel Special Development Zone and other investments. Young Lourdes has published several articles about the Mariel Zone and other investments for trade magazines in which she emphasizes the advantages to investing in Cuba and how to go about it.

(Part II of an investigative report conducted by journalist Ulisses Fernández. To read the entire report, please press here)

https://www.cubanet.org/english/more-about-the-davalos-family-daddy-paved-the-way/