Guaidó is Gone But London Keeps the Gold

The U.K. stripped the assets of a foreign state and transferred them to political actors engaged in regime change, John McEvoy reports. The result has been a form of collective punishment for people in Venezuela.

Bank of England in London, 2020. (It’s No Game. Flickr, CC BY 2.0)

By John McEvoy
Declassified UK

In late December, Venezuela’s leading opposition parties voted to oust Juan Guaidó as “interim president” and dissolve his parallel government.

This was clearly not the ending the U.K. government had in mind.

Four years ago, the British government made the bold decision to recognise Guaidó as Venezuelan president and proceeded to facilitate his legal battle to seize roughly $2 billion of gold held in the Bank of England.

Indeed, the U.K. government insisted at every turn that it recognised Guaidó — and not Nicolás Maduro — as Venezuelan president. In turn, Guaidó’s lawyers argued that he was authorised to represent and control the assets of the Central Bank of Venezuela held in London.

Throughout this time, Guaidó paid his U.K. legal costs by drawing on millions of dollars of his country’s assets originally seized by the U.S. government. In other words, Guaidó tried to seize Venezuelan state assets with looted Venezuelan state assets.

Meanwhile, it seems certain that the Foreign Office also used a significant amount of public funds to sustain its backing of Guaidó.

Now that Guaidó has been ousted, the legal argument for transferring the gold to the Venezuelan opposition has effectively disintegrated. Despite this, the gold remains frozen in the Bank of England, with no clear resolution in sight.

Whatever happens next, this case sets a precedent which could have far-reaching consequences: the U.K.’s coup weapons now include asset stripping a foreign state, and transferring those assets to political actors engaged in regime change.

This will surely serve as a warning to any state which plans to store its gold in the Bank of England.

Recognising Guaidó

Feb. 25, 2019: Juan Guaidó with Brazil’s Vice President Hamilton Mourão in Bogotá, Colombia. (Gabriel Cruz, CC BY 2.0, Wikimedia Commons)

The recognition of Guaidó was a key prerequisite for the Bank of England’s refusal to release Venezuela’s gold.

Guaidó had never run for presidential office. Yet on Jan. 23, 2019, he swore himself in as Venezuelan “interim president,” using Article 233 of the Venezuelan constitution to declare that Maduro had abandoned his post and thereby left an “absolute vacuum of power.” 

This vacuum, claimed Guaidó, would have to be filled by the president of Venezuela’s National Assembly — a post he occupied.

Without the support of the U.S. government, Guaidó’s legal gymnastics would probably not have gotten him very far. However, the Donald Trump administration moved quickly to recognise Guaidó and began pressuring the so-called international community to follow suit.

The day after Guaidó’s self-swearing in, then U.K. Foreign Secretary Jeremy Hunt visited Washington and met key members of the Trump administration including Secretary of State Mike Pompeo, Vice President Mike Pence and National Security Advisor John Bolton.

[Related: Pompeo — A Monster Slaying Monsters Abroad]

The political crisis in Venezuela was high on the agenda. Before meeting with Pompeo, Hunt told the press that “the United Kingdom believes Juan Guaidó is the right person to take Venezuela forward. We are supporting the U.S., Canada, Brazil and Argentina to make that happen.” This was a strong statement – but not yet recognition.

Documents obtained by Declassified show that Hunt was privately thanked by Pompeo and Bolton for this. However, Britain’s contribution to toppling Maduro would go further.

‘Delighted’ to Freeze the Gold

May 8, 2019: U.S. Secretary of State Michael Pompeo, right, at Carlton Gardens, the formal residence of U.K. Foreign Secretary Jeremy Hunt, on left. (State Department, Ron Przysucha, Public domain)

The Foreign Office is refusing to say whether its officials or ministers have had discussions with counterparts in the United States on the Venezuelan gold stored in the Bank of England since 2019. 

In response to a Freedom of Information request, it also claimed that “the release of information relating to this case could harm our relations with the United States of America and Venezuela.”

Yet according to Bolton, Hunt was “delighted” to help with Washington’s destabilisation campaign in Venezuela, “for example freezing Venezuelan gold deposits in the Bank of England.”

The Bank’s directors, however, were uneasy about the legal implications of freezing a foreign state’s assets. The Bank of England had already refused to release Venezuela’s gold in 2018, citing doubts over the legitimacy of Maduro’s government, though they were on shaky legal ground.

Alan Duncan. (Chris McAndrew, CC BY 3.0, Wikimedia Commons)

The Foreign Office worked to ease their nerves. On Jan. 25, 2019, Alan Duncan, the minister of state for Europe and the Americas, wrote in his diary that he held a phone call with Mark Carney, governor of the Bank of England, about Venezuela’s gold. He wrote:

“I tell Carney that I fully appreciate that, although it’s a decision for the Bank, he needs a measure of political air cover from us. I tell him I will write him the most robust letter I can get through the FCO lawyers, and it will outline the growing doubts over Maduro’s legitimacy and explain that many countries no longer consider him to be the country’s President.”

In other words, the Bank of England required a robust legal rationale for keeping Venezuela’s gold frozen, and the Foreign Office was happy to provide it with one.

One week later, on Feb. 4, Hunt went one step further by issuing an official statement recognising Guaidó “as the constitutional interim President of Venezuela, until credible presidential elections can be held.”

With this, the U.K. government had committed to the Washington-backed coup effort. Hunt apparently declared: “Venezuela is in their back yard, and it’s probably the only foreign adventure they might just pursue.”

When the Foreign Office was asked in parliament last month whether it received legal advice in recognising Guaidó as president, it replied, “We do not comment on when legal advice has been received.”

The Legal Battle

The U.K.’s recognition of Guaidó triggered a protracted legal battle over the gold.

In May 2020, the Maduro government sued the Bank of England over its refusal to release the gold. The issue then moved to the courts, centering on whether the U.K. government recognised Guaidó and if the Bank of England could therefore act on instructions from his “ad-hoc board” of the Central Bank of Venezuela.

Throughout this time, the U.K. government consistently supported Guaidó’s case by emphasising its recognition of him.

In 2020, for instance, the Foreign Office provided a written certificate to the courts to confirm that the U.K. still “recognises Juan Guaido as the constitutional interim President of Venezuela.”

Foreign leaders greeting Venezuelan President Nicolas Maduro at his second inauguration, Jan. 10, 2019. (Presidencia El Salvador CC0, Wikimedia Commons)

In 2021, the Foreign Office even acquired the services of Sir James Eadie QC and Jason Pobjoy (of Blackstone Chambers) and Sir Michael Wood and Belinda McRae (of Twenty Essex) — some of the country’s top lawyers — to present its case on recognition of Guaidó at the Supreme Court.

It thus looks certain that the U.K. government has spent a significant amount of public funds on this case. This casts obvious doubts on the U.K. government’s claim that this is merely a matter for the Bank of England or the courts: the U.K. has invested both political and seemingly financial capital into this case, with the explicit intention of overthrowing the Maduro government.

Declassified asked the Government Legal Department how much was spent in legal costs on this case. A spokesperson for the Department said: “We will not comment further due to ongoing legal proceedings.”

With each hearing, Guaidó and his representatives also incurred substantial costs. Recently published accounts suggest that Guaidó’s team spent over $8.5m on legal fees — roughly £7m.

Remarkably, Guaidó’s U.K. legal fees were paid with money which was originally appropriated from the Venezuelan state in the U.S. 

Guaidó Gone

Central Bank of Venezuela building in Caracas. (Caracasapie, CC BY-SA 2.0, Wikimedia Commons)

Guaidó and his representatives never managed to get their hands on the gold.

In the most recent hearing, in October 2022, Justice Cockerill granted the Maduro board permission to appeal, declaring that the issues at stake were “effectively unprecedented” and that “the consequences of the decision have the potential to affect all the citizens of Venezuela.”

Indeed, the freezing of Venezuela’s gold has served as a form of collective punishment. 

In 2021, United Nations special rapporteur on sanctions, Alena Douhan, urged the U.K. “and corresponding banks to unfreeze assets of the Venezuela Central Bank to purchase medicine, vaccines, food, medical and other equipment, spare parts and other essential goods to guarantee humanitarian needs of the people of Venezuela.”

With the issue still in the courts, Venezuela’s main opposition parties voted in December 2022 to remove Guaidó as “interim president” and dissolve his parallel government. 

The U.K. government announced that it would “respect the result of this vote,” adding that: “The U.K. continues not to accept the legitimacy of the administration put in place by Nicolás Maduro.”

[Related: Washington’s Version of Venezuela]

The legal basis for freezing Venezuela’s gold and transferring it to the Venezuelan opposition has therefore largely crumbled. Further hearings are expected later this year.

Whether the gold will remain frozen until Venezuela holds elections which are to the satisfaction of the U.K. government, or the courts will find that the case for freezing the gold has now collapsed, remains unclear. 

The issue would be immediately resolved if the U.K. normalised relations with the Maduro government — though this would entail an embarrassing climb-down and would have to be worked out alongside Washington.

What’s clear is that the sanctions regime against Venezuela has failed to remove Maduro, but has harmed ordinary Venezuelans.

John McEvoy is an independent journalist who has written for International History Review, The Canary, Tribune Magazine, Jacobin and Brasil Wire.

This article is from Declassified UK.

The views expressed are solely those of the author and may or may not reflect those of Consortium News.

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24 comments for “Guaidó is Gone But London Keeps the Gold

  1. Sam Spade
    February 8, 2023 at 00:02

    But, stealing is not against “The Rules Based Order”

    Not when the Godfather makes the Rules.

  2. Sam Spade
    February 8, 2023 at 00:01

    “How is it possible, Corrupt and criminal characters govern democratic western nations? ”

    People voted for them.
    I really wish they would stop doing that.
    Can you please try to do better?

    Stop voting for the candidates which have big piles of money would be a good first step towards avoiding the corrupt ones.

    How do you think they got those big piles of money? If you want an honest leader, vote for someone who is not rich and who’s campaign is broke. No guarantees there either, but we know for sure that the rich ain’t honest, and that they ain’t getting into heaven. We shouldn’t let them into government either.

  3. Sam Spade
    February 7, 2023 at 23:55

    Mike Pompeo’s 3rd American Commandment …. We Steal!

    From the verse where he proudly proclaims “We Lie! We Cheat! We Steal!”

  4. Renate
    February 7, 2023 at 12:31

    Democracy, the best government? How is it possible, Corrupt and criminal characters govern democratic western nations?

    President Biden called President Putin a war criminal, a killer, did he ever look in the mirror to see what he is?

    The US, the UK, and Germany are good examples of characterless people in charge. Another is Zelensky selling Ukraine and the people to be eradicated so that he and his gang can fill their pockets.

  5. cjonsson1
    February 6, 2023 at 23:37

    Stealing is a sin. It is also against the law for anyone who abides by the law.

  6. ks
    February 6, 2023 at 23:06

    Western governments are common thieves and blackmailers. A Mafia rules-based order.

  7. Eric
    February 6, 2023 at 20:49

    Another (rarely acknowledged) Canadian credit:

    The Bank of England governor who denied Venezuela access to its own gold
    — thus despoiling the bank’s credibility as a safe international respository —
    was Mark Carney, former governor of the Bank of Canada, and rumoured
    a year or so ago to be a high-profile Liberal politiician in the making.

    • Randal Marlin
      February 6, 2023 at 23:13

      I don’t expect this information will enhance Mark Carney’s political prospects in Canada.

      • February 7, 2023 at 13:00

        Wasn’t Canada one of the first countries to recognize Guido?

        • Rafael
          February 9, 2023 at 02:34

          Must have been. They lead the “Lima Group”, dedicated to bringing down the Venezuelan government. No words can adequately describe how despicable and debased Canada’s international role has become.

  8. Occupy on!
    February 6, 2023 at 19:37

    “The issue would be immediately resolved if the U.K. normalised relations with the Maduro government — though this would entail an embarrassing climb-down and would have to be worked out alongside Washington.”

    London, with all its dignified mien, has, at last, no shame.

  9. Arch Stanton
    February 6, 2023 at 19:22

    The UK are Americas poodle, a subservient vassal state that is going down the pan at a rate of knots. However, in terms of treachery it still leads the world.

    Corrupt politicians like Alan Duncan have grown filthy rich courting dodgy regimes all over the world, and yet here he is doing the US’s bidding in yet another regime change. Since when is a country that’s over 4,500km away classed as being in one’s back yard? Using that warped logic Kazakhstan is in the UKs backyard.

    • Otto
      February 7, 2023 at 08:32

      Well said on all points – thanks.

  10. Jeff Harrison
    February 6, 2023 at 19:18

    The United States can only properly be described as a criminal enterprise, stealing the assets of Venezuela and Russia (we also stole the assets of Iran and Afghanistan although we returned the Iranian assets we froze over the objections of the greedy guts in Congress). All this will only hasten the day when the US$ will no longer be the lingua franca of the financial world.

  11. TRogers
    February 6, 2023 at 18:58

    These types of gold thefts are not new. A bunch were carried out by City of London bankers in the 1930’s, as explained in this informative article.

    • Maricata
      February 7, 2023 at 09:36

      And do not forget about the Golden Lilly funds stolen by Japan and then stolen by the US.

      See The Golden Lilly by Stearling and Peggy Seagrave.

      Same with the Black Eagle fund and the other funds stolen from Germany after the war.

      We are talking trillions of dollars.

    • ks
      February 8, 2023 at 10:51

      That Blue Moon Article is blatantly antisemitic, and I don’t use that word lightly.

  12. Martin
    February 6, 2023 at 17:19

    disgusting albion, i hope everyone takes the lesson home: quietly but firmly remove your assets from the uk.

  13. Lois Gagnon
    February 6, 2023 at 16:26

    And the US/Euro imperialists still can’t fathom why the entire global south is looking to a future aligned with Russia and China. Karma will eventually get those who believe they cannot be held to account for abusing people who have done them no harm.

  14. February 6, 2023 at 15:26

    A reality check when evaluating the real reason for the suffering in Venezuela and for the exodus of many of its people. Theft is just fine as long as we and our allies do the stealing. This makes clear just what a sick joke the Democrats January 6 Committee was.

  15. Realist
    February 6, 2023 at 14:47

    Lesson learned: “Democracy” in the “less developed” world (read less affluent and/or less politically connected with the ruling regime in Washington) is only accepted as “legitimate” by the government of the United States of North America and its subservient vassal states comprising the so-called “West,” which by proclamation are the only “real” democracies on the planet and the only entities empowered to recognise the existence of other real, legitimate democracies. Thus the right of any government to exert the self-determination of its own society, including the right to collect taxes and own fiscal property, sundry financial instruments (such as bank accounts, stocks or bonds), fungible issued currency, or even precious metals (including gold, silver, copper and perhaps even lithium, e.g., read accounts of recent coup in Bolivia) for the benefit of that society is strictly limited and constrained by the limitless prerogatives of the omnipotent North American government based in Washington.

    N.B., the right to the national self-determination of any country is not limited totally or even primarily by its relative economic prosperity, as this is a moving target that can be manipulated at will to suit the ends of the American regime in Washington, as has been experienced with extreme prejudice by the nations of Iran and Russia which have both had hundreds of billions of dollars in assets seized by the American state in operations that would traditionally be characterized as plain and simple theft or piracy. To overcome the constraints of more sane reasoning, the exceptional American state explains to the allegedly simple-minded that, if you intend to trade with America or with the West in general, you must do so in dollars. This means that the better part of your national wealth must be held in the form of dollars, sequestered in American (or other Western) financial institutions. Those dollars are merely supposed to represent your wealth to make it universally fungible (not to “be” your actual wealth). However, when expedient, Washington will claim the latter interpretation to be the reality. Moreover, it will claim that, since it printed and issued the dollars held in your name in some Western bank, it is the ultimate owner of all those dollars, you have only been using them, and they are entitled to retrieve them without compensation at any time or circumstance of their choosing. So, Russia is expected to gladly suffer the seizure of three hundred billion dollars in assets from American or other Western banks in cahoots with the oh-so-clever Yanks. Somehow, I guess through the commutative property of basic arithmetic, Washington thinks it can also ultimately lay claim to Venezuela’s two billion dollars worth of gold bullion kept stored in the vaults of the Bank of England. Does Zelensky actually think that Washington will ever return any of the Ukrainian gold holdings spirited out of the country by Washington in the aftermath of the Maidan coup? I know that’s just chicken feed in the larger picture, and I’m pretty sure that’s all been split up amongst the guardians of “real” Western-style democracy, including Porky, Yatz, the Kagans and don’t forget the “Big Guy” himself–for “services rendered,” of course. Obviously, I am no certified professional “money changer,” but it is breathtaking to watch them repeatedly fleece the entire planet for the last residue of value.

    • Maricata
      February 7, 2023 at 09:38

      Neo-Colonialism—In Neo-Colonialism: the Last Stage of Imperialism Kwame Nkrumah explains:

      “Neo-colonialism is based upon the principle of breaking up former large united colonial territories into a number of small non-viable States which are incapable of independent development and must rely upon the former imperial power for defense and even internal security.

      Their economic and financial systems are linked, as in colonial days, with those of the former colonial ruler.”

      Night-Visions: Illuminating War and Class on the Neo-Colonial Terrain explains:

      “The previous capitalist world order was bipolar, with everyone visible massed around opposing poles of oppressor vs. oppressed. It was colonized vs. colonizer, white vs. black, invader vs. indigenous.

      The growing chaos of the neo-colonial world order is that many different peoples—armed with conflicting capitalist agendas—have been loosed to fight it out… Trans-national capitalism is driving a certain kind of breakthrough idea, a “multicultural” worldview in which each people and grouping is freed and encouraged to explore its own capitalist agenda no matter what form it takes…Everyone is free to go for it, free to fight it out any way they want so long as they don’t endanger the system itself.”

      In the context of this series, neocolonialism describes the shape-shifting nature of contemporary imperialism that absorbs and capitalizes on the emergence of new politics and identities. Subgroups are assimilated into kapitalism and bonded to imperialist interests, all for the purpose of maintaining material colonial domination.”

    • Louis Béchard
      February 8, 2023 at 10:29

      I wonder how long this toothpick & wet papier maché abomination sagging visibly will continue to be sold & enforced as a necessity. Its end is WAY overdue. However the mercantiles are amoral and clever, the world awaits new & improved.

  16. DMCP
    February 6, 2023 at 14:34

    With the UK seizing Venezuela’s gold, the US seizing Afghanistan’s dollars, and all the Western powers seizing Russia’s assets, it’s no wonder that some of the BRICS nations are considering an alternative to US dollar currency for trade. Banks used to be considered a safe place to store one’s money; now they’re more like a financial Roach Motel: money checks in but it will never check out.

Comments are closed.