Cuba-Related Claim on BNP Paribas Forfeiture Tossed by Ju

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BNP Paribas Charged
Eric Holder, U.S. attorney general, center, speaks during a news conference on BNP Paribas SA with James Comey, director of the Federal Bureau of Investigation (FBI), left, and James Cole, deputy U.S. attorney general, at the Department of Justice in Washington, D.C., on June 30, 2014. BNP Paribas SA pleaded guilty and agreed to pay a record $8.9 billion for violating U.S. sanctions. Photographer: Andrew Harrer/Bloomberg

A Cuban-American woman seeking compensation for the death of her father at the hands of the Castro regime lost her bid for a piece of the billions of dollars BNP Paribas SA agreed to pay for violating U.S. trade sanctions.

Marilyn Wiederspan, a Nebraska teacher, sought to have a $63.6 million judgment paid out of the almost $9 billion BNP forfeiture. She obtained the judgment from a Florida court against Cuba and Fidel Castro for the 1959 torture and execution of her father, Jose Velasquez Fernandez, a lieutenant in the Cuban army.

BNP, France’s largest bank, admitted in July that it engaged in a long-running conspiracy to violate U.S. embargoes against Sudan, Iran and Cuba by processing billions of dollars in banned transactions from 2004 to 2012. Sentencing is set for Friday before U.S. District Judge Lorna Schofield in Manhattan

On Thursday, Schofield rejected Wiederspan’s bid to intervene in the BNP case, saying the Florida judgment is against Cuba, not the bank. Wiederspan failed to show that Cuba has any “ownership” of the funds that BNP is forfeiting, the judge said.

Wiederspan said she was entitled to a portion of the funds the bank agreed to forfeit as part of the plea that were tied to Cuba. The judgment was composed of almost $6.4 billion in penalties for illicit transactions with Sudan, $686,600 with Iran and $1.7 billion with Cuba.

Wrong Proceeding

Wiederspan “has every right to enforce her valid judgment against the Republic of Cuba in a proceeding,” the judge said. “This is not such a proceeding.”

In the bank case, the U.S. has asked Schofield to sentence BNP in accordance with the plea agreement reached in July. The sentence the bank faces Friday includes a final order forfeiting $8.8 billion and a fine of $140 million as well as five years’ probation, Assistant U.S. Attorney Andrew Goldstein said in a memo to the court.

BNP, which as part of a guilty plea to New York state charges has already forfeited $2.24 billion to the Manhattan district attorney, paid the Federal Reserve $508 million and New York’s Department of Financial services $2.24 billion, Goldstein said.

Those payments are to be credited against BNP’s total money judgment and the bank has already transferred the remaining $3.8 billion to the U.S. pending the final forfeiture ordered by Schofield at sentencing.

‘Terrorist Party’

Wiederspan’s lawyer, William Sanchez, had said his client was entitled to the funds under the Terrorism Risk Insurance Act of 2002, which allows the seizure of “blocked assets of a terrorist party” to satisfy a judgment.

Sanchez said he will appeal the judge’s ruling, adding that Schofield hasn’t yet ruled on his argument Wiederspan is entitled to a judgment under a federal law that allows victims of a crime to seek restitution from a wrongdoer.

“We’re going to continue to fight this,” he said.

Wiederspan isn’t alone in seeking redress in U.S. courts for acts carried out on foreign soil. The family of Gustavo Villoldo Argilagos, a Cuban educated in the U.S., sued BNP in December, saying he committed suicide after being tortured by the Castro regime. That case is pending before a different federal judge in New York.

President Barack Obama’s move in December to establish diplomatic ties with Cuba and ease economic barriers has renewed efforts by some with claims against the Castro regime. The U.S. recognizes more than 5,900 claims against Cuba stemming from the expropriation of property owned by Americans in the aftermath of the revolution, according to the Foreign Claims Settlement Commission, an arm of the Justice Department.

Jim Margolin, a spokesman for Manhattan U.S. Attorney Preet Bharara, whose office brought the BNP case, declined to comment on Schofield’s ruling.

The case is U.S. v. BNP Paribas 14-cr-00460, U.S. District Court, Southern District of New York (Manhattan).

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