Bank of England Accused Of Unlawfully Blocking Release of Venezuelan Gold Bars

The political dispute surrounding the rightful ownership of 400,000 bars of gold held in the vaults of the Bank of England was heard in the high court, early this week.

Maduro’s government claims that the 31 tonnes of gold bars are being unlawfully blocked, and have cited the act as a strategic ploy to “curry favor with the US. Lawyers for Maduro’s Central Bank of Venezuela have vowed in court that if the gold bars are handed over the proceeds will be used solely to supply humanitarian goods to its own people, and specifically to fight coronavirus” -- as suggested in a media report.

But, the claims are being refuted by Maduro’s rival Juan Guaido -- who is pegged as Venezuela’s interim president by the U.K. Foreign Office, ever since Maduro’s presidential elections scandal came to the fore. Guaido reiterated that the gold reserves belong to his parallel Central Bank, and that Maduro intends to use the funds to support his regime, which is plunged in turmoil.

The dispute surrounding the gold bars can be traced back to May 2018, when Maduro secured majority and re-election that had the main opposition coalition boycotted and crying foul.

Soon after, Boris Johnson, the current U.K. Prime Minister and then British foreign secretary, seemed to have sided with the opposition when he hinted at how there was “a need to tighten the economic screw on Venezuela.”

Fast forward to two years, the courts will now get to take the final call. While a further probe into the case is underway, what is yet to be decided is whether a U.K. commercial and property court has significant power to decide the consequences of these political disputes. Add to it, what needs to be known is whether the U.K. government has, in actuality, recognized Guaidó as interim president and the legitimate ruler of Venezuela, as it claims or if the country’s head of state continues to be Maduro.

Guaidó’s team has pulled forth an argument that the Foreign Office has recognized his regime, and backed it up with the fact that a U.K. court cannot undermine the U.K. government’s decision.

However, a media report cites that if the judge, Justice Teare, was to decide Britain still, de facto, recognizes Maduro as the ruler of Venezuela, stakes are high that Teare would order funds to be released to Maduro.