Jeremy Paner Warns of Increased Legal Risk for Multinationals and Banks Connected to Brazil After US Terrorist Designations of Brazilian Drug Cartels
Highlights
The U.S. announced the designations of Brazil’s two largest organized crime syndicates as Foreign Terrorist Organizations.
Paner warns of increased risk exposure for multinationals and banks connected to Brazil.
Jeremy Paner warned of increased U.S. legal risk exposure for multinationals and banks connected to Brazil in the Financial Times, following the U.S. announcement that it would designate Brazilian cartels Primeiro Comando do Capital (PCC) and Comando Vermelho (CV) as Foreign Terrorist Organizations.
On May 28, U.S. Secretary of State Marco Rubio announced the immediate SDGT designations of Brazil’s two largest organized crime syndicates, with the FTO designations taking effect on June 5.
Among other legal effects, the Foreign Terrorist Organization designations make it unlawful for both U.S. and foreign individuals and entities to knowingly provide “material support” to the groups. The designations carry other wide-ranking effects that significantly expand the U.S. legal exposure for companies with ties to Brazil.
“These actions change the US legal risk exposure for every multinational and bank connected to Brazil,” Paner said.
According to the Financial Times, the Trump administration’s announcement comes during Brazilian President Lula’s re-election campaign, with the current administration opposing the move, warning it could open the door to U.S. military intervention.
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