Bank of England under fire over Venezuelan gold

Venezuela gold

The Bank of England risks becoming embroiled in another political storm after concerns were raised over a meeting of top officials from Venezuela, which is seeking the return of 14 tonnes of gold.

The Bank is reportedly due to meet Calixto Ortega Sanchez, president of the Venezuelan Central Bank, and Simon Zerpa, the Venezuelan minister of finance, over the repatriation of 550 million US dollars (£431 million) of gold.

The Bank is the second largest depository of gold and has been holding Venezuela’s gold deposits since the 1980s.

Andrew Lewer MP wrote to the Bank and the Treasury, criticising the move, saying a meeting “would pose significant reputational risk to the Bank and may be in violation of US Treasury imposed sanctions”.

Mr Lewer said Mr Zerpa has been sanctioned by the US Treasury Department and that Mr Ortega Sanchez “is not a legitimate president” of the Venezuelan Central Bank as his appointment “was not ratified by the National Assembly”.

“It is entirely inappropriate for senior officials of the Bank of England to meet with an individual who has been placed on the US sanctions list for reasons of corruption. To treat with such an individual would threaten the reputation of both the Bank of England and the Government as a whole,” Mr Lewer said.

The Bank of England declined to comment.

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There are fears that Venezuelan President Nicolas Maduro may misuse the gold (Maxim Shemetov/Pool Photo via AP)

There are concerns that Venezuela’s president, Nicolas Maduro, may misuse the gold if received as the country deals with hyperinflation.

Mr Maduro has been criticised for corruption and economic mismanagement and human rights abuses.

Mr Lewes urged the Bank not go ahead with the meeting and not to transfer the gold as it “would be used for corrupt personal enrichment of regime leaders, or intensified repression of the population”.

The Bank has come under fire lately for being drawn into politics, particularly over Britain’s departure from the European Union.

Mervyn King, the former governor of the Bank, and Andrew Sentance, a former Bank policymaker, indicated that the Bank was risking its reputation for being independent.