Sun | Dec 17, 2017

Florida bans future investments in Maduro's Venezuela

Published:Friday | August 18, 2017 | 12:00 AM

Florida Governor Rick Scott easily won approval Wednesday for a proposal to bar the state's US$150-billion pension plan from making future investments that directly support the regime of President Nicol·s Maduro in Venezuela.

Scott and the two other trustees who oversee the plan quickly approved the ban, which could be more symbolic than substantive, since the Florida Retirement System doesn't currently invest in any companies or securities controlled or owned by Venezuelan government interests.

Scott, a likely Republican challenger of Democratic Senator Bill Nelson next year, called the ban a "huge step in the right direction."

Backtracking from vows

But Nelson, another Maduro critic, accused Scott of backtracking from his original vows by banning only direct investments in Venezuela, but not sanctioning companies that do business there.

Scott had told a rally in Miami last month that "any organisation that does business with the Maduro regime cannot do business with the state of Florida".

Florida already has laws that prohibit the state from investing in companies that do business in Cuba, Iran and Sudan. And last year, the State Board of Administration was ordered to divest from companies that boycott Israel.

But the final proposal approved Wednesday doesn't target all companies that may be doing business in the country, nor would it affect the investment banking firm Goldman Sachs, which acquired US$2.8 billion in bonds initially issued by Venezuela's state-run oil company PDVSA at a steep discount last year, acting through a broker for a client.

The bank manages some of Florida's investment portfolio, and the state owns stock in Goldman Sachs. Some Republicans, including Senator Marco Rubio, sharply criticised the PDVSA purchase, calling it a "lifeline" for the Maduro regime.

Records obtained this week by The Associated Press show that the State Board of Administration prepared a document in mid-July indicating that parting ways with the firm could have a significant impact on the pension plan.

That same document also showed that Florida owns stocks in nearly two dozen companies doing business in Venezuela. Ash Williams, executive director of the board, shared the details with Scott's office as well as with other board trustees.

After Scott first raised the idea of taking action, Goldman Sachs hired prominent Tallahassee lobbyists, including a friend and ally of the governor, who met with company officials in July.

Scott defended the state's actions taken so far and denied that he's backtracked.

"I don't want to do any business with the Maduro regime," Scott said. "Companies that do business with the Venezuelan people, that's not our target."

- AP