- Myanmar’s military has failed to withdraw roughly US$1 billion (A$1.3 billion) in funds from the Federal Reserve Bank of New York
- The attempt to secure funds came just days after the military detained Myanmar’s elected leaders in a coup on Feb 1, 2020
- The transaction was automatically blocked by Federal Reserve safeguards then indefinitely denied by U.S. officials shortly after
- President Joe Biden stated that the United States will prevent Myanmar’s generals from “improperly having access” to government funds
- It remains to be seen how frozen bank accounts and other international sanctions will impact the violent junta currently controlling Myanmar
Myanmar’s military has failed to withdraw roughly US$1 billion (A$1.3 billion) in funds from the Federal Reserve Bank of New York.
On Feb 1, the country’s military forces orchestrated a coup, in which it usurped power by detaining Myanmar’s democratically elected leaders. Days later on Feb 4, Myanmar’s new military leaders attempted to secure funds from an account with the Federal Reserve Bank of New York.
The transaction, made in the name of the Central Bank of Myanmar, was automatically blocked by Federal Reserve safeguards. The processes which denied the withdrawal have been in place at the Federal Reserve Bank of New York since before the coup took place.
In light of the political upheaval and civil unrest taking place in Myanmar, U.S. officials stalled on approving the transfer.
It’s likely that the delay was also because transactions involving Myanmar have been under additional scrutiny since last year. The country was put on the international Financial Action Task Force’s “gray list”, over concerns about money laundering.
Soon after the transfer was stalled, U.S. President Joe Biden issued an executive order, giving the officials the legal authority to block the transaction indefinitely.
This has effectively frozen Myanmar;s accounts with the Federal Reserve Bank for now. On February 10, President Biden stated that the United States was taking steps to prevent Myanmar’s generals from “improperly having access” to government funds.
This may put Myanmar’s new leaders in a precarious financial position. Since seizing power, the country’s military has been subject to punitive sanctions from various world leaders.
The sanctions have been in response to the military’s attack on Myanmar’s burgeoning democracy as well as its lethal treatment of protestors. Since the coup in February, at least 54 people have been killed and over 1700 people arrested.
It remains to be seen how frozen bank accounts and other punitive international sanctions will impact the violent junta currently in control of Myanmar.