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U.S. closes loopholes on Cuba

Government eliminates ‘fully hosted’ category, and two regatta organizers are indicted

Government eliminates ‘fully hosted’ category, and two regatta organizers are indicted

The Bush Administration has begun its promised crackdown on cruising to Cuba, bringing grand jury indictments against two Florida Keys sailors who organized sailing regattas to the island, and adopting rules that would shut down most legal U.S. pleasure boat travel there.

Starting June 30 the Treasury Department, which enforces the U.S. ban on spending money in Cuba, eliminated the category of “fully hosted” travel, the one under which many boaters visited the island.

Also, the Coast Guard no longer will issue a security zone permit to boaters who wish to cruise to Cuba unless they have secured a license to travel there from Treasury’s Office of Foreign Assets Control and an export license from the Commerce Department. (The boat and everything in it are considered exportable items.)

“This is part of an overall crackdown and tightening of restrictions,” says treasury spokesperson Molly Millerwise. She says the goal is to staunch the flow of dollars to Cuba. The Cuban man on the street who takes dollars in payment for goods or services must turn them in for pesos, propping up Castro’s government with hard currency, she says.

The U.S. Justice Department announced June 10 that a federal grand jury meeting in Key West had indicted Peter Goldsmith and Key West sailmaker Michele Geslin, on charges of operating or conspiring to operate an unlicensed travel service to Cuba. Goldsmith and Geslin organized the May 2003 Conch Republic Cup race from Key West to Varadero and Havana, and two previous races to Cuba in November 2000 and May 2002. The indictment accuses the two of violating the Trading with the Enemy Act.

OFAC had warned them “on a number of occasions” that they needed an OFAC travel service license to organize regattas to Cuba, according to a Justice Department press release. Others who have applied for licenses to run races to Cuba have been denied them.

Released on $50,000 bond each, the Key West residents face up to 15 years in prison and a $350,000 fine if convicted on both counts. Neither was available for comment. Goldsmith’s home telephone had been disconnected, and the answering machine at Geslin’s sail loft was full of unanswered messages.

Art Heitzer, chairman of the National Lawyers Guild Cuba subcommittee, says Conch Republic Cup skippers carried food and medicine for distribution in Cuba, and raced there under a humanitarian license issued to John Young and his Concord Cay Hueso, an organization that has been sending humanitarian supplies to Cuba since 1992. Heitzer says the Treasury Department withdrew Young’s license after the regatta. He says Customs agents were waiting at the dock in Key West to board boats as they returned from the race, confiscating logs, film, cameras, laptops and other records. “They said, ‘If you give us any hassle we’ll seize your boat,’ ” Heitzer says. Many skippers received subpoenas to testify before the grand jury, which had been meeting since at least February.

Under the now-eliminated fully hosted category, boaters could visit Cuba legally without spending any money. Many did this by traveling fully provisioned to sustain themselves during their stay and letting the Cuban government host them by paying all dockage, customs and immigration fees. The Treasury Department believes a lot of dollars changed hands even when U.S. cruisers or others were fully hosted.

The department “has found that persons who claimed their travel was fully hosted routinely engaged in prohibited money transactions,” according to information about the rule changes on OFAC’s Web site.

In addition to reining in pleasure boaters, the new OFAC rules restrict U.S. residents who visit relatives in Cuba to just one trip every three years instead of annual visits; limit the money they can take with them for relatives to $300 per trip; require that the $300 they are allowed to send quarterly to Cuba go to immediate family only; tighten the rules for conference travel to Cuba; allow student educational trips only under the license of their own graduate or undergraduate school and only if the trips are for course credit; and eliminate the allowance for licensed travelers to bring home up to $100 worth of Cuban goods.

Millerwise says boaters now must seek three permits before they can legally cruise to Cuba: an OFAC travel license, a Commerce Department export license, and a Coast Guard security zone permit.

Under a Feb. 26 presidential order expanding the president’s authority to regulate vessels in U.S. waters that are in transit to or from Cuba, the Coast Guard is authorized at the Secretary of Homeland Security’s direction to board and seize vessels that plan to visit or have visited the island without the required licensing.

The likelihood of boaters getting the permits they need to cruise Cuba are minuscule now, says Doran Cushing, a Florida sailor, freelance writer and charter captain who has sailed to Cuba and promoted races there. An advocate of opening Cuba to cruisers, he says he no longer would recommend cruising there without permits.

“I used to tell people, ‘If you know how to play the game and you are willing to play the game, you can go to Cuba and get away with it,’ ” he says. “I would not recommend that anyone go to Cuba now under these conditions.”

Neither does the Coast Guard. Its Miami Web site ( warns boaters that failure to get a security zone permit to visit Cuba can result in “vessel seizure, up to $250,000 fine, and 10 years in prison.”

Heitzer interprets the indictment of the Conch Republic Cup organizers and the threat of more charges against boaters under the new rules as election-year politicking for Cuban-American votes, not a savvy strategy for eroding support in Cuba for strongman Fidel Castro.

“Putting these people in jail for organizing a regatta to Cuba is striking a blow for freedom?” Heitzer asks. “I don’t see it.”