Dave Seleski: Cuba’s unlikely banking pioneer

Eric Ellis
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When the history of banking in communist Cuba is written, Dave Seleski, head of Florida-based Stonegate Bank, may well be hailed as a leader who triumphed against the odds.

Dave Seleski-600
Dave Seleski: the go-to businessman for business advice on Cuba

Urbane and well-groomed, career banker Dave Seleski is an unlikely revolutionary. Tiny by US standards, with assets of around $3 billion, Seleski’s Stonegate Bank has found itself in the extraordinary position of being the only US bank to be authorized by both Washington and Havana to do business in Cuba.

The nimble Seleski has, for the moment at least, an effective monopoly on US banking with Cuba; his reward for resolving an issue that had threatened to derail Washington’s diplomatic rapprochement with the Castros.

As influential rivals look on, Stonegate’s credit and debit cards are today the only US-issued plastic acceptable in Cuba. Stonegate also has US banking’s only correspondent relationship with a Cuban bank, the state-owned Banco Internacional de Comercio. Stonegate also banks Cuba’s new diplomatic missions in the US and is opening US accounts for the fast-emerging private-entrepreneur class transforming Cuba’s command economy.

Beyond banking, Seleski has become the go-to businessman for business advice on Cuba, a fixture on the seminar circuit for those anxious for insight on how to enter one of the world’s last untapped markets. Only half-jokingly, he likens his Cuban whirlwind to the film 'Forrest Gump’, where the protagonist unwittingly finds himself at the centre of monumental events.

"We just kept going until the point that it became too hard or seemed like a bad idea," Seleski tells Euromoney at Stonegate’s headquarters in Pompano Beach, an hour’s drive north of Miami. "And it never has."

"The Cubans have been very good to me," he says. "When you spend the time to get to know them, the central bank, the officials, you find they have the same goals as you do, that they don’t want a problem either. They’re trying to get rid of the blockade, so it’s very important that everything goes smoothly for them."

Seleski’s arrival as the pivot in Cuba-US financial engagement owes much to his relationship with a client, Florida businessman Ariel Pereda. A US-born Cuban-American, Pereda has been selling food products to Cuba for about a decade. Since 2010 he has banked with Seleski at Stonegate, which specializes in servicing small Florida businesses.

The son of an exile from Castro’s Cuba, Pereda’s small trading operation had been permitted by Washington within the blockade’s legal limits. But legal or otherwise, any contact with Castro’s Cuba was divisive for Pereda at home in southern Florida where exiled anti-Castro hardliners, many of whom had their businesses seized after the 1959 revolution, have blackballed anyone doing business with communist Cuba. Indeed, one reason Pereda banked at Stonegate was because he had been rebuffed at other banks with strong ties to Florida’s wealthy Cuban community, a persuasive lobby in the US. 

We don’t want to depend anymore on anyone. We used to depend on Spain, then the US, then the USSR because of the US blockade and now we have some dependency on the oil from Venezuela. Our main goal is not to depend 
- Deborah Rivas Saavedra,
Ministry of Foreign Trade and Investment

Undaunted by the disapproval, Pereda tells Euromoney that he had long enthused to Seleski about Cuba’s business possibilities, which have been stifled because of Washington’s 56-year-old embargo designed to throttle the Castro economy. Seleski made his first trip to Cuba in 2011, with Pereda as his guide.

"I could see things were changing and I was curious," Seleski says.

Seleski arrived in Havana just as Raul Castro formally took over the Cuban presidency from his ailing brother Fidel. Raul launched a series of market reforms of the island’s broken Soviet-style economy, allowing Cubans to run low-level private businesses. Ordinary Cubans were also permitted to travel abroad privately for the first time in decades.

In the US, attitudes also began to shift and during 2013/14, president Barack Obama responded to overtures from the Vatican and the Canadian government to broker a rapprochement between Washington and Havana.

As positions on both sides of the Florida Strait softened, Pereda’s business dealings with the Cuban government won him a place on the board of Engage Cuba, a Washington lobby group backed by businesses such as Procter & Gamble, Viacom and Honeywell and a range of industry and civil society institutions. Engage Cuba’s mantra is for the two ideological enemies to set aside their hostilities and trade to each side’s benefit.

"No business in the world would continue a strategy that has failed for 55 years," Engage says of the US embargo.

On March 12 last year, Seleski got a call from Pereda, who was in Washington dining with Mark Wells, who ran the US State Department’s Cuba desk and was leading the Obama initiative to normalize relations between Havana and Washington.

As Wells explained to Pereda, these negotiations had hit an unexpected and potentially deal-breaking roadblock. Havana could not secure even the most basic banking arrangements for its proposed embassy in Washington.

For years Cuba’s de facto diplomats in the US had banked with Buffalo-based M&T Bank, which had specialized in servicing foreign missions in the US. But in 2013, M&T came under scrutiny from regulators policing the US Bank Secrecy Act and shut down its embassy banking operation, including Cuba’s accounts.

It was a case where one part of the government was not in alignment with another, a bureaucratic turf war which had the potential to stymie diplomacy.

"The State Department went around everywhere trying to get someone to bank them," says Seleski, "And no one would do it."

The upshot for Cuba was that its US-based diplomats could now only transact everyday diplomatic business, such as visa fees, in cash.

"They were literally taking bag loads of cash to Havana," says Seleski. "It was a crazy situation."