Cuban family hits French bank SocGen with $792 million lawsuit for trafficking in stolen property

Before the Cuban revolution, Banco Nuñez operated in Cuba and had about 10% of the nation’s market share. But like it did to all private businesses in Cuba, the Castro dictatorship in 1960 outright stole the bank at gunpoint, offering no compensation to its rightful owners. All banks on the island got rolled up into one central bank, Banco Nacional de Cuba, which is owned and controlled by the Castro family dictatorship.

French bank Societe Generale was well aware any business with the Cuban dictatorship involved the trafficking in stolen property. Nevertheless, they ignored the risks and engaged in some very profitable bank deals with Banco Nacional de Cuba.

SocGen knew it was trafficking in stolen property, but they obviously never anticipated this would happen (via Reuters):

In a complaint filed on Wednesday with the U.S. District Court in Miami, 14 grandchildren of Carlos and Pura Nuñez, who once owned Banco Nuñez, want to hold Societe Generale liable under U.S. law for doing business with Cuba’s central bank, which nationalized Banco Nuñez and other lenders in 1960.

A lawyer for the plaintiffs said he believed the case was the first against a bank that allegedly “trafficked” in property expropriated by the Castro regime, since the Trump administration said in April it would begin letting U.S. nationals sue companies for such conduct.

“Victims of the Cuban regime who had their property confiscated now have a vehicle to get justice,” Javier Lopez, the lawyer, said in an interview. “We have multiple financial institutions that we’re looking to target.”

Societe Generale did not immediately respond to requests for comment after market hours.

The lawsuit was filed eight months after Societe Generale agreed to pay $1.34 billion and enter a deferred prosecution agreement to settle U.S. and New York regulatory charges that it handled billions of dollars of transactions related to Cuba and other countries under U.S. sanctions.

According to the plaintiffs, Societe Generale generated hundreds of millions of dollars of fees by lending money to and processing transactions for Banco Nacional de Cuba from 2000 to 2010.

The plaintiffs said they own a claim to 10.5% of the equity in Banco Nacional de Cuba, roughly the percentage that Banco Nuñez represented when it was seized.

Lawyers for the plaintiffs at Kozyak Tropin & Throckmorton based the $792 million damages estimate on Banco Nuñez’s $7.8 million worth at the time, plus 6% annual interest and triple damages under the Helms-Burton Act, a 1996 federal law.

The right to sue under that law had been suspended for 23 years because of opposition from the international community and concern that U.S. courts could be overrun by lawsuits.

Societe Generale took a risk, one they obviously thought was minimal. They were wrong.


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