How Cuba fooled the U.S. to get millions of dollars from Miami for its armed forces
The Cuban government has been fooling U.S. sanctions by concealing the true nature of the company that handles money sent by Cuban-Americans to their families on the island, a Miami Herald investigation shows.
The Trump administration imposed sanctions in 2020 on the Cuban military, banning it from handling the remittances from the U.S., and the Biden administration has kept the sanctions in place. The Cuban government pretended to create a new company independent of the military to handle the millions of dollars sent yearly to the island through Western Union and Miami-based money-transfer agencies. But in reality, secret documents reviewed by the Herald show the new company has been controlled by the Cuban military all along.
Orbit S.A., the Cuban government company that currently handles remittances from the United States, was created by the Havana government after the Trump administration imposed sanctions on its predecessor, Fincimex, in 2020, because of its close ties to the Cuban military.
The U.S. policy aimed to punish Cuba’s armed forces for their violations of human rights on the island and their support for Venezuelan strongman Nicolás Maduro, while at the same trying to redirect foreign currency reaching the island to the private sector — and away from the military.
Remittances sent by Cuban Americans in the U.S to help their families on the island have for decades been a key source of foreign revenue for the Cuban military, which controls much of the island’s economy — from tourist hotels to gas stations to real estate — through a conglomerate known as GAESA, short for Grupo de Administración Empresarial S.A.
The Trump sanctions ended remittances to Cuba for two years, at least formally, until Cuba reassured the United States in 2022 that it had created the new remittances company, Orbit, with no ties to the armed forces.
On paper, Orbit is part of the Cuban Ministry of Foreign Trade and Investment. But the documents reviewed by the Herald show that Orbit is, in reality, secretly run by another firm named Cimex — a key company under the military’s GAESA umbrella. The links are tight: Orbit is headed by Diana Rosa Rodríguez Pérez, a former executive vice president for GAESA.
The documents show that Cimex, which in turn oversees Fincimex, provides monthly detailed reports to higher-ups in GAESA of the money transfers processed by Orbit and regularly discusses the company’s performance with GAESA’s top executives.
The new revelations will likely bring new U.S. scrutiny to Western Union’s current deal with Orbit, and perhaps a new crackdown on remittances. The incoming Trump administration will be packed with Cuba hardliners like U.S. Sen. Marco Rubio, the nominee for secretary of state, who was one of the principal architects of the policy to put pressure on the Cuban military in the first place.
The embargo’s effect
The deal allowing Orbit to handle remittances was authorized by the U.S. Treasury Department in 2022 with the understanding that the Cuban company had no ties to the military. Other Miami-based remittance agencies, such as VaCuba and Cubamax, also have current contracts with Orbit.
Because of the decades-old U.S. trade embargo on Cuba, any financial dealings with the island that would normally be prohibited — such as money transfers — have to be licensed by the U.S. Treasury Department.
Western Union fully resumed money transfers to Cuba in March 2023. The company told the Miami Herald at the time that Orbit would act “as Western Union’s bank account payout processor in Cuba.”
Asked for response to the new information about Orbit’s links to the military, Western Union spokesperson Brad Jones said: “We will reserve comment at this time.”
VaCuba and Cubamax did not respond to requests for comment.
The Treasury and State departments did not immediately reply to requests for comment.
“It takes skill, determination and well-cultivated sources to uncover detrimental military and economic information relating to sanctions on Cuba, given the enormous efforts to conceal that information. Yet this is exactly the type of journalism that is essential to policymakers and the American people to strengthen our national security,” said U.S. Rep. Mario Díaz-Balart, a Cuban American Republican who worked closely with Rubio to design Cuba policy during the first Trump administration.
“If these reports are true, they illustrate the importance of diligent, robust sanctions enforcement,” he said.
Díaz-Balart criticized the Biden administration for “weakening” sanctions on remittances and travel to Cuba while expanding dialogue and “other absurd exchanges between U.S. officials and Cuban operatives.”
“The contrast between the Trump and Biden-Harris Administrations on sanctions enforcement is clear, and I look forward to working with the incoming administration to support the Cuban people by denying resources to the brutal, anti-American dictatorship that oppresses them,” he added.
Secret documents
The revelations in this story are based on the Herald’s review of Cimex’s secret documents, on information provided by a source with knowledge of the companies’ internal dealings who asked not to be identified to avoid government retaliation, and on publicly available data.
Before the Trump-era sanctions, GAESA controlled remittances sent by Cubans abroad to their families on the island through services like Western Union. In order to operate on the island, Western Union and other companies were required by Cuban authorities to sign contracts with Financiera Cimex, or Fincimex, a Cimex subsidiary registered in Panama that provides financial services.
But in October 2020, Western Union was forced to shut down its offices in Cuba after the U.S. State Department added Fincimex to its list of restricted Cuban companies, shutting off the flow of dollars to the island. The list highlights companies linked to the Cuban military and bans U.S. nationals from doing business with them. Miami’s VaCuba and Cubamax canceled their remittance agreements with Fincimex as well.
GAESA, Cimex and Fincimex were also blacklisted by the U.S. Treasury Department. And the Trump administration reduced the amount of money that could be sent to the relatives on the island.
“We are working on further regulations that would further close any loopholes … that the regime has had and used to manipulate the Cuban people and skim off every dollar that people attempt to send to their families,” a senior Trump administration official told the Herald at the time. “We are closing every door, every loophole.”
Large source of revenue
At the time, experts estimated that money sent by Cubans from abroad was the island’s second-largest source of foreign revenue, and that Western Union held a large chunk of that market. The country received an estimated $2 billion a year in remittances. That figure also included money sent through informal channels – for example, people known as mulas traveling to Cuba carrying cash – as well as the dollar value of food, medicines, clothes and other articles carried by travelers or sent in packages through agencies like VaCuba and Cubamax.
The money sent by Cubans in the U.S. and Cuban Americans is a lifeline to many families on the island, which is going through one of its worst economic crises in decades.
But remittances have also become a key source of dollars for Cuban military-owned companies, which not only take a fee for handling the transactions (in 2020 it was $1 for each $100 wired through Western Union) but, most critically, keep the dollars and instead give recipients on the island their equivalent in local currency.
GAESA keeps its money separate from the Cuban government’s budget, jealously guarding it from government auditors. For example, in May, Gladys Bejerano, the island’s general comptroller at the time, told the Spanish news agency EFE that she could not audit GAESA because it was not under her supervision. She was fired from the post shortly after without explanation.
Cuban official data show GAESA has used millions of dollars to build new hotels in recent years, despite the island’s worsening economic crisis and claims by the government that it does not have enough money to buy enough food and oil to feed the population and keep the lights on.