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Report on Venezuela Custody Account Operations, January to September 2026

KPMG, authorized for public release by the State Department · 2026-11-12

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Authorized for Public Release by the U.S. Department of State

Table of Contents

1. Executive Overview 7. Stage 3: Disbursement Requests and
1.1. Introduction Authorization
1.2. Key Takeaways 7.1. Request and Intake Process
7.2. Evolution of Foreign Exchange (FX)
2. Program Framework and Operating Mechanism
Environment 7.3. Electronic FX Intervention
2.1. Background Mechanism
2.2. Report Scope, Oversight, and 7.4. Banknote FX Interventions
Limitations Mechanism
2.3. Summary 7.5. Statistical Sampling Methodology
2.4. Stakeholder Roles 7.6. Vendor Payments

3. Venezuela Custody Account Summary 8. Stage 4: Controlled Disbursement
(January – September 2026) 8.1. Outflow from the BCV
3.1. U.S. Treasury Venezuela Custody 8.2. Master Combined Outflow Ledger
Account and Historical Custody 8.3. Downstream Recipients
Account Overview
9. Ongoing Monitoring Plan & Strategy
4. The Process 9.1. Ongoing Monitoring Plan
4.1. The Flow of Funds

5. Stage 1: Sale of Natural Resources
5.1. Approved Depositors
5.2. Authorized Deposits & Financial
Summary

6. Stage 2: Deposits into the Venezuela
Custody Account
6.1. How Funds Enter the Venezuela
Custody Account
6.2. Deposit Activities
6.3. Due Diligence and Deposit Reviews

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Figure 1: Summary Snapshot of Funds ......................................................................................................... 8
Figure 2: Stakeholder Roles and Primary Responsibility ............................................................................. 9
Figure 3: Monthly Account Activity........................................................................................................... 11
Figure 4: The Flow of Funds ...................................................................................................................... 12
Figure 5: Approved Depositors as of September 30, 2026 ......................................................................... 14
Figure 6: Types of Deposits by Resource ................................................................................................... 15
Figure 7: Deposit Management ................................................................................................................... 16
Figure 8: Total Deposit Payments and Amount of Deposits....................................................................... 18
Figure 9: Overview of Request & Intake Process ....................................................................................... 21
Figure 10: Legacy Auction Activity ........................................................................................................... 22
Figure 11: Electronic FX Intervention Overview ....................................................................................... 23
Figure 12: Venezuelan Recipient Commercial Banks ................................................................................ 25
Figure 13: Electronic FX Intervention Activity .......................................................................................... 27
Figure 14: Combined Legacy Auction and Electronic FX Activity............................................................ 28
Figure 15: Banknote Distributions .............................................................................................................. 29
Figure 16: Banknote FX Intervention Activity ........................................................................................... 31
Figure 17: Banknote Control Process ......................................................................................................... 33
Figure 18: Recipient Due Diligence Procedures ......................................................................................... 34
Figure 19: Sampling Process Overview ...................................................................................................... 35
Figure 20: Transaction Verification Process ............................................................................................... 37
Figure 21: Risk-Based Transaction Due Diligence Framework ................................................................. 39
Figure 22: Venezuela Natural Resource Deposits to Final Recipient ......................................................... 41
Figure 23: Deposits to Final Recipient Key Clarifications ......................................................................... 42
Figure 24: Monthly Disbursements by Intervention Mechanism ............................................................... 43
Figure 25: January – September 2026 Disbursements to Registered Beneficiary / Recipient .................... 47
Figure 26: Recipient Entity Category Amounts in USD ............................................................................. 49
Figure 27: Percentage Distributed by Sector from Sample ......................................................................... 50
Figure 28: Recipients in Sectors from Sample............................................................................................ 51

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1. Executive Overview

1.1 Introduction

This report provides a comprehensive account of the Venezuelan natural resource revenues deposited in,
held by, and disbursed from the U.S. Treasury Venezuela Custody Account (also referred to as the
Venezuela Custody Account), a deposit fund account established consistent with Executive Order (E.O.)
14373, “Safeguarding Venezuelan Oil Revenue for the Good of the American and Venezuelan People.” 1 It
documents the financial oversight, governance, and control mechanisms implemented by the U.S.
Department of State (DoS) and its contracted monitor and advisor, KPMG, to promote transparency and
accountability in the management of these funds.

The Venezuela Financial Transparency Program reviews deposit receipts, fund administration, compliance
activities, and disbursement processes associated with the Venezuela Custody Account. This report
provides visibility into how funds are deposited, monitored, managed, and disbursed in accordance with
established authorization, compliance, and governance protocols to support approved macroeconomic,
public-sector, humanitarian, and operational purposes. Not all these processes and the safeguards described
below have been in place since January 2026; the process has been iterative and DoS and KPMG have
adjusted, refined, and added to these processes over time. All funds and natural resource proceeds
administered under this program constitute sovereign assets of the Bolivarian Republic of Venezuela, held
and managed exclusively for the benefit of the Venezuelan people.

This report covers January 3, 2026, to September 30, 2026, and may be updated to reflect future data and
enhanced monitoring capabilities, including centralized data repositories, automated reconciliation, and
advanced analytics. Any subsequent report will integrate newly available transaction-level records, risk
assessments, and compliance findings as these data governance and modernization initiatives mature.

For analytical clarity, the report progresses from strategic and financial review to operational oversight and
compliance activities. The sections that follow include a financial summary (traceability), review of the
Venezuela Custody Account transaction activity, vetting and forensic reviews, institutional oversight and
governance descriptions, and a forward outlook. Together, these sections provide an integrated view of the
controls, monitoring activities, and governance processes supporting the administration of funds within the
Venezuela Custody Account framework.

During the first nine months of operation, the U.S. Government established custodial control over
Venezuelan natural resource revenue deposits, implemented multi-layered authorization and compliance
controls, and monitored the distribution of funds through approved economic and public-sector channels.
More than $12 billion was deposited and disbursed under a controlled governance structure designed to
promote transparency, accountability, and protection of sovereign assets. 2

1.2 Key Takeaways

• The Venezuela Custody Account has centralized management of Venezuelan natural resource deposits
subject to relevant Office of Foreign Assets Control (OFAC) licenses.

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• In accordance with requests from the interim Government of Venezuela and consistent with approved
expenditure parameters, the DoS and U.S. Treasury have reviewed and executed disbursements of
$12.11 billion through authorized Foreign Exchange (FX) and Vendor Payment Mechanisms while
maintaining robust approval, monitoring, and reporting controls.
• These disbursements are managed through an advanced financial monitoring program, which includes
transaction reviews, control assessments, stakeholder outreach, recipient testing, counterparty
verification, on-site diligence, and ongoing validation procedures.
• The oversight and review provided by the DoS, U.S. Treasury, and KPMG are in addition to compliance
controls in place at Venezuelan commercial banks, U.S. correspondent banks, and other financial
institutions, as well as U.S. and Venezuelan financial regulatory and oversight bodies.
• Authorized transactions are subject to multiple layers of compliance and control, including sanctions
screening to mitigate the risk of inadvertently providing support or resources to foreign terrorist
organizations or their members, Anti-Money Laundering (AML) and Know Your Customer (KYC)
reviews, transaction monitoring, and verification procedures performed by participating commercial
banks, financial institutions, and other service providers involved in the payment lifecycle.
• To supplement these controls, the DoS and KPMG address risks identified through the monitoring
program by implementing appropriate mitigation measures, conducting additional validation and due
diligence procedures, and strengthening oversight controls to support compliant, transparent, and
accountable fund disbursements.

2. Program Framework and Operating Environment

2.1 Background

On January 9, 2026, President Donald J. Trump issued E.O. 14373, pursuant to authorities including the
International Emergency Economic Powers Act and the National Emergencies Act. 3 The Order established
protections governing specified Venezuelan government revenues held by the United States, defined as
“Foreign Government Deposit Funds” (FGDF), which include funds derived from commodity-sale
proceeds of Venezuelan natural resources from the Government of Venezuela or its agencies or
instrumentalities. Under the Order, covered funds are held by the U.S. Treasury in a designated Venezuela
Custody Account. The funds remain sovereign property of Venezuela and are protected from attachment or
other judicial process and may not be transferred, withdrawn, or otherwise dealt in except as authorized.
The funds are held pending disposition for public, governmental, or diplomatic purposes as determined by
the Secretary of State, with the Secretary of the Treasury responsible for their administration and for
executing authorized disbursements or transfers. 4

Operating Environment & Challenges. Venezuela’s vast natural resources, particularly its oil reserves,
have historically served as the primary engine of the nation’s economy and principal source of U.S. Dollar
(USD) income. Over time, sanctions, international legal disputes, governance challenges, and financial-
control deficiencies significantly constrained traditional fund flows and Venezuela’s access to international
financial markets. These conditions increased risks related to the receipt, management, and distribution of
resource-derived funds, creating the need for enhanced oversight mechanisms to increase transparency,
preserve economic continuity, safeguard critical revenue streams, and support the delivery of essential
public services.

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Program Rationale & Controlled Structure. Certain OFAC licenses (e.g., General Licenses 46E, 48D,
50C, 51D, 52C, and 54C) direct firms to deposit payments to the Government of Venezuela, or its agencies
or instrumentalities, made in exchange for authorized activities involving Venezuela-origin natural
resources in the Venezuela Custody Account. The Venezuela Custody Account mechanism serves as a
controlled deposit management structure under which payments from authorized activities involving
Venezuelan natural resources are used for authorized macroeconomic, public-sector, humanitarian, and
operational purposes. Like escrow, trust, and other controlled holding-account arrangements used in
financial oversight environments, this approach provides heightened transparency into the management and
release of funds by allowing for transaction monitoring and other compliance controls. Authorized funds
are subsequently disbursed from the Venezuela Custody Account to designated transaction accounts, or
approved third-party accounts, at the direction of the Banco Central de Venezuela (BCV), following
transaction review, approval and authorization procedures. The BCV administers allocations and
disbursements to approved downstream entities, including commercial banks, and payments on behalf of
government entities and public service organizations. This structure is intended to support macroeconomic
stability and the restoration of critical governmental functions and key sectors, including energy,
infrastructure, healthcare, and public services, while promoting accountability and stewardship of public
resources.

Program Oversight & Governance Controls. To support the accountable administration of public funds,
requests for disbursement are subject to a structured authorization and compliance review process
administered under DoS protocols supported by KPMG. The BCV, on behalf of the interim Venezuelan
government, submits disbursement requests to the DoS detailing the intended use of funds for approved
governmental, operational, and public-interest objectives. Through controlled disbursement, transaction
monitoring, and defined oversight mechanisms, the program promotes transparency, guards against
unauthorized use of funds, strengthens financial controls, and supports restoration of Venezuela’s
institutional capacity and economic sustainability.

This approach is designed to balance immediate operational continuity and the execution of essential and
time-sensitive disbursements with the compliance, transparency, and oversight mechanisms necessary to
safeguard sovereign resources and support long-term institutional development.

2.2 Report Scope, Oversight, and Limitations

The legal authorities, implementation milestones, and stakeholder responsibilities described above form the
overarching governance structure for the management of Venezuelan natural resource revenues. The
structure of day-to-day financial operations includes collection, custody, authorization, disbursement, and
monitoring of funds. This report examines those activities by tracing the flow of funds through each stage
of the operational lifecycle and documenting the controls, processes, and oversight mechanisms established
to promote transparency, accountability, and stewardship.

The report draws upon consolidated Venezuela Custody Account records, DoS financial data, and
supporting transaction information covering the period from January 2026 through September 2026. The
report examines deposit inflows, custody arrangements, foreign exchange interventions, vendor payments,
banknote distribution, and related monitoring procedures to provide visibility into program operations,

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financial activity, and key fund-flow mechanisms. In addition, the report details the authorization processes,
compliance activities, oversight controls, and risk management procedures implemented across the
program.

In the interest of maximum transparency, this report provides account, monthly, entity, and transaction-
level reporting as of a point-in-time on September 30, 2026. Figures in this report displaying deposit,
allocation, authorization, transfer, and disbursement amounts may vary due to the timing of operational
processing, settlement, and reporting across the various accounts involved in the process. Despite these
timing-related variances, all figures presented in this report reconcile to the underlying transactions and
account balances.

Confidentiality Notice: Certain analyses, findings, examples, and data elements contained within this
report are derived from information provided under confidentiality obligations and non-disclosure
agreements (NDAs). Any references to depositor-specific information, proprietary operational data, or
other restricted content are intended solely for use by authorized U.S. Government personnel.

The following sections examine the principal components of the fund management process, beginning with
the Venezuela Custody Account and progressing through deposit collection, custody, authorization,
disbursement, and ongoing monitoring activities. Together, these sections provide an integrated view of
how funds move through the program and the controls applied throughout the process.

2.3 Summary

The Venezuela Custody Account serves as the central custody and oversight mechanism for revenues
generated from activities related to Venezuelan natural resources. The oversight structure provides
transparency into how funds are collected, managed, authorized, safeguarded, and disbursed to advance
approved economic and humanitarian objectives.

During the period covered by this report (January 3 – September 30, 2026), the Venezuela Custody Account
received deposits totaling more than $12.26 billion from verified and approved entities engaging in
authorized activities related to Venezuelan natural resources. While crude oil and petroleum-related
deposits represented the largest source of inflows, the account also received approved deposits associated
with gold, mineral, and fertilizer transactions. Of the total amount, $12.11 billion (98.7%) was disbursed
from the Venezuela Custody Account,while $168.56 million remained in custody as of September 30, 2026,
for future authorized disbursements pursuant to requests by the BCV on behalf of the interim Government
of Venezuela.

The figure below demonstrates the scale of the framework, the movement of funds through controlled
financial channels, and the oversight mechanisms established to promote transparency, accountability, and
stewardship of Venezuelan natural resource revenues.

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3. Venezuela Custody Account Summary (January – September
2026)

3.1 U.S. Treasury Venezuela Custody Account and Historical Custody Account Overview

To provide verifiable oversight of Venezuelan natural resource revenues, the U.S. government established
a centralized custody account to safeguard sovereign assets and enable deposits to be approved, tracked,
and protected from unauthorized use prior to their approved disbursement.

Implementation of this approach was executed in two distinct phases. During the initial phase, through
January 2026, for safeguarding purposes, deposit payments made by firms in exchange for the sale of
Venezuela-origin natural resources were deposited into a temporary custody account of the BCV’s at a
commercial offshore banking institution, the Qatar National Bank (QNB), subject to custody controls
described in Section 3.1.1 below. By late January 2026, custody account operations transitioned to the U.S.
Treasury Venezuela Custody Account.

The following subsections summarize the purpose, activity, and disposition of each of these custody
accounts and provide a detailed overview of the transition from the interim arrangement to the active
custody account structure. Collectively, they illustrate the volume of natural resource revenues deposited
and the amounts disbursed through approved channels.

3.1.1 Phase 1: Interim Custody Account (January 2026)

In January 2026, a temporary custody account of the BCV’s at QNB was established to hold deposit
payments from the initial U.S.-facilitated sales of Venezuelan oil. Use of the Qatari bank provided a short-
term, exigent solution to facilitate the urgent sale of oil that had accumulated in storage and was at risk of
creating permanent shut-in of Venezuelan oil production, and to avoid creditor attachment while holding
the initial Venezuelan oil deposit payments until the U.S.-based mechanism was established. Similar to the
protection from creditor attachment subsequently established by E.O. 14373, this approach prevented
creditors from disrupting access to the revenues and allowed for continued availability of funds to address
Venezuela’s critical economic and governmental needs. This interim mechanism provided emergency
liquidity and oversight of $500 million in initial deposits.

Following receipt of the initial $500 million in deposits, funds were allocated and disbursed to participating
Venezuelan financial institutions through a legacy Foreign Exchange Auction process described in Section
7.2.1. On January 15, 2026, $300 million was disbursed to four participating Venezuelan financial
institutions: Mercantil C.A. Banco Universal, Banco Provincial (BBVA), Banesco Banco Universal, and
Banco Nacional de Credito (BNC). Each institution received $75 million to facilitate the exchange of VES. 7

Additional authorized disbursements of $163.95 million and $36 million followed on January 23 and
January 28, 2026, respectively, bringing total disbursements to $499.95 million. As of September 30,
$50,000 remains in the Interim Qatar Custodial Account.

3.1.2 Phase 2: U.S. Treasury Venezuela Custody Account Activity (January 2026 – September 2026)

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6.1.2 Non-Standard Intake Workflow (Suspense Mitigation)

To maintain the integrity of the Venezuela Custody Account and prevent unauthorized, fraudulent, or non-
compliant deposits, any deposits made into the account without prior approval from the DoS are treated as
compliance risks until their source and purpose can be verified. These funds are isolated and subjected to
additional review. Although this is not a common occurrence, these instances are subjected to established
due diligence processes.

In these instances, the DoS places the funds in suspense. KPMG, in coordination with the DoS, initiates
outreach to the depositor and other relevant parties to obtain the required documentation, which is then
reviewed by KPMG and the DoS. If the information is deficient, the deposit is rejected and the funds return
to the prospective depositor’s bank that sent the funds to the Venezuela Custody Account.

6.2 Deposit Activities

Funds are deposited into the Venezuela Custody Account in accordance with applicable OFAC licenses
(which require depositors engaged in covered activities to deposit funds into the Venezuela Custody
Account) and are subject to DoS approval. The DoS ensures deposit payments are allocated to appropriate
subaccounts based on information about the transaction generating the proceeds for deposit.

Under these authorizations, cumulative natural resource funds deposited into the account totaled $12.26
billion across 20 registered depositors between January 1 and September 30, 2026. The figure below
illustrates monthly deposit trends and summarizes cumulative depositor activity demonstrating that deposit
activity was initially concentrated among a limited number of counterparties, with participation broadening
over time as additional depositors were onboarded through September 2026.

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• Invoice & Documentation Integrity: Assesses whether invoices, contracts, and transfer records are
accurate, complete, reconcilable, and sufficient to substantiate authorized goods or services.
• Conflicts of Interest: Assesses potential self-dealing, state capture, non-arm’s-length arrangements, or
undisclosed relationships that could compromise transaction integrity.

As directed by the DoS, KPMG conducts Enhanced Due Diligence (EDD) on specific entities and deposits,
including reviews of originators, intermediaries, and beneficiaries. As part of the review process, KPMG
assesses the depositor relationship and associated parties through validation of organizational identity,
ownership structures, operational activities, relevant OFAC licensing considerations, and the nature and
purpose of the underlying transaction. Depending on the level of risk identified, additional procedures may
include outreach to depositors, requests for supplemental documentation, coordination with OFAC to
confirm license compliance, or reviews of other related entities and counterparties. When reviews initially
identify risk indicators requiring further diligence, KPMG assists the DoS with additional document
requests and other information tracking to resolve any missing information, or, if appropriate, support the
DoS decision to reject or continue to suspend a depositor until all information gaps could be resolved.

7. Stage 3: Disbursement Requests and Authorization

Disbursement requests are subject to a structured authorization process. The BCV sends requests with
relevant supporting documentation to the DoS. At the direction of the DoS, KPMG reviews each request to
confirm that the funds support DoS-approved purposes and satisfy documentation requirements and
applicable governance, compliance, and oversight standards. This review includes analysis of
counterparties, ownership structures, sanctions considerations, terrorist finance risks, contractual
arrangements, and the proposed use of funds. The following sections outline the disbursement request
intake process, disbursement channels, and the associated controls and diligence program to validate these
disbursements.

7.1 Request and Intake Process

Funding requests initiated by the BCV may ultimately be routed through one of two disbursement channels:
FX Interventions (Electronic and Banknote) or Vendor Payments, as illustrated in the figure below.

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liquidity is allocated, and the operational process governs how funds move from the BCV through
commercial banks and ultimately to businesses and individuals.

7.3.1 Electronic FX Intervention Control Process

The Electronic FX Intervention process follows a structured cycle to identify, assess, monitor, and
document fund flows. The lifecycle begins when the BCV submits bank-level foreign exchange allocation
requests to the DoS for review and approval. Following review and approval by the DoS and the U.S.
Treasury, authorized funds are transferred from the Venezuela Custody Account to a BCV operational
account for subsequent distribution across participating commercial banks. The DoS and U.S. Treasury
serve a custodial function and administer requested deposits and disbursements in alignment with E.O.
14373, and the list of approved and prohibited expenditures.

As part of its monetary policy program, the BCV conducts foreign exchange interventions on a weekly
basis and determines the amount of USD to be allocated to participating institutions. The allocation date
and intervention date are effectively the same, representing the point at which the BCV assigns USD to a
participating bank. Following the intervention date, participating institutions are provided five business
days to distribute the USD to eligible customers. Banks may utilize an additional five-business-day
liquidation period, resulting in a maximum liquidation period of ten business days from the intervention
date. 20

Transactions are denominated in USD, and as a result, participating commercial banks cannot settle or clear
these funds locally; they are legally and operationally required to maintain active correspondent and
custodial relationships with U.S. financial institutions. Through these correspondent banking arrangements,
participating institutions maintain USD settlement accounts used to receive and distribute foreign exchange
intervention allocations. Every dollar disbursed through the electronic FX intervention program therefore
passes through the U.S. financial system, making an active U.S. correspondent banking relationship a
prerequisite for participation in the program. 21

Participating commercial banks receive and clear intervention funds through USD settlement accounts
maintained with U.S. correspondent banking partners, which are required to facilitate USD-denominated
transactions. Individual and corporate recipients, however, may receive intervention funds through foreign-
currency accounts maintained at participating Venezuelan financial institutions and are subject to customer
identification, sanctions screening, due diligence, and transaction-monitoring requirements before and after
funds are disbursed. In addition to customer-level controls performed by participating institutions, U.S.
correspondent banks conduct due diligence over the foreign banks with which they maintain relationships,
including assessments of AML, sanctions compliance, customer due diligence, and transaction monitoring
programs. As a result, the control framework incorporates multiple layers of review across the disbursement
chain.

Participating commercial banks screen and monitor customers and transactions, while U.S. correspondent
banks independently assess and oversee the control environments supporting these activities. These controls
provide additional safeguards designed to identify, investigate, restrict, or reject potentially prohibited or
high-risk transactions before and during the movement of funds. Consequently, electronic FX intervention
funds are not distributed directly to unidentified members of the public. Rather, access to USD is provided
through regulated financial institutions operating within established compliance frameworks and subject to

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disbursement chain, where U.S. financial institutions independently assess the control environments
supporting the movement of USD funds.

U.S. correspondent banks function as an independent compliance control point within the disbursement
chain. To comply with federal regulatory requirements, these institutions perform independent sanctions
screening, transaction monitoring, and periodic review activities, while retaining the authority to block,
reject, or freeze transactions that trigger sanctions or compliance alerts.

Escalation Workflows and Downstream Visibility

When compliance exceptions are identified, participating financial institutions may temporarily restrict
account activity pending further review. These institutions maintain controls to identify and address
potential financial crime risks, including account review and conditioning procedures, sanctions screening
and escalation protocols, restrictions for confirmed sanctions matches, and the reporting of suspicious
activity to applicable regulatory authorities in accordance with legal and regulatory requirements.

This commercial and correspondent banking control structure is supplemented by downstream transparency
mechanisms for continuous financial oversight. The BCV provides the DoS and KPMG transaction-level
reporting covering each USD intervention disbursement, which allows for review, analysis, and
downstream screening of transactions. This expanded reporting provides enhanced visibility into end-
recipient populations, operational industry sectors, and transaction velocities across the commercial
banking system, supporting ongoing tracking, recipient analysis, and trend testing of intervention outcomes.

7.3.2 Electronic FX Intervention Activity

Between March 31, 2026, and the end of the reporting period, a total of $9.32 billion has been disbursed
through the Electronic FX Intervention Mechanism. 23

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Figure 14: Combined Legacy Auction and Electronic FX Activity

Note: Activity includes Legacy Auction Mechanism disbursements through March 30, 2026, and Electronic FX Intervention
activity beginning March 31, 2026.

7.4 Banknote FX Interventions Mechanism

In July 2026, the program introduced physical USD Banknote Distribution through the Banknote FX
Intervention Program as a complementary mechanism for providing liquidity to the Venezuelan economy.
This initiative is supported by an arrangement with the U.S. Department of State (DoS), which authorizes
the use of custodial funds to facilitate the import and distribution of physical U.S. currency. The cash
distribution process, which is governed for Venezuela by the BCV and SUDEBAN regulatory frameworks,
involves pre-shipment bank due diligence, secure air cargo delivery, controlled armored transport to vaults
located at BCV facilities, and rigorous multi-day counting procedures to capture and record banknote serial
numbers. SUDEBAN, as the primary AML and Countering the Financing of Terrorism (CFT) supervisor
for the Venezuelan banking sector, enforces Resolution N° 010.25, which mandates comprehensive risk
management systems for all supervised institutions. 25 The Banknote Control Process developed by the DoS
and KPMG, in conjunction with the U.S. Treasury and the Federal Reserve, provides the governance and
EDD for the implementation of the USD Banknote Distribution.

The Banknote FX Intervention Mechanism is designed to support transactions that rely on cash-based
payment methods and to expand access to USD throughout the Venezuelan economy given present
limitations to banking access, connectivity to the U.S. financial system, and electronic payment
infrastructure. Increasing the volume of physical U.S. currency in circulation allows for a wider diffusion
of USD in Venezuela, supporting commercial activity and facilitating the purchase of essential goods and

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• Banknote Delivery 2 (July 8, 2026): The second Banknote FX Intervention was completed with
the delivery of an additional $100.0 million. 27 Consistent with established procedures, the shipment
underwent secure transport, counting, verification, physical audit activities, and due diligence of
end recipients between July 9 and July 17 prior to distribution to Banesco, BBVA, Provincial, and
Mercantil.
• Banknote Delivery 3 (July 30, 2026): The third Banknote FX Intervention, totaling $149.8
million, represented the largest distribution conducted under the program. 28 Following delivery,
the shipment underwent secure transport, counting, verification, and physical audit activities
between July 31 and August 6. Following these procedures, due diligence of end recipients of the
banknotes was conducted before funds were released to participating commercial banks Banesco,
BBVA Provincial, BNC, and Mercantil. The first distribution of funds to these banks occurred on
August 25. 29
• Banknote Delivery 4 (August 21, 2026): The fourth Banknote FX Intervention was for a total of
$100.0 million. 30 The shipment was processed in accordance with established cash-handling
procedures, including secure transport, counting, verification, and physical audit activities
completed by August 31. Participation was expanded after KPMG and Numisma performed a
review of Banco de Venezuela’s (BDV) policies and control environments and determined the
institution demonstrated sufficiently robust AML and CFT controls to support the controlled
distribution of banknotes. Following these procedures, due diligence of end recipients of the
banknotes was conducted and $64.0 million in funds was distributed to Banesco, BBVA Provincial,
Mercantil, and BDV, with the remaining funds awaiting distribution.
• Banknote Delivery 5 (September 18, 2026): The fifth Banknote FX Intervention was for a total
of $100.0 million. 31 The shipment was processed in accordance with established cash-handling
procedures, including secure transport, counting, verification, and physical audit activities
completed on September 22. As of September 30, the funds have not been distributed to commercial
banks, and are pending authorization to end recipients, subject to review under the Banknote
Control Process.

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section summarizes the control framework governing the receipt, storage, counting, and distribution of
banknotes.

7.4.2 Banknote Control Process

DoS collaborated closely with U.S. Treasury and the Federal Reserve in developing the Banknote Control
Process that represents leading oversight practices over the Banknote Distribution lifecycle. The control
process establishes a testing framework that mitigates AML, sanctions, and counterfeit risks, aligns key
stakeholders across the BCV intervention exchange program, and enables secure, compliant, and expedited
downstream distribution of banknotes. DoS partnered with global banknote providers who are licensed non-
bank financial intermediaries and specialized international financial entities operating under U.S. regulatory
and AML frameworks.

As part of the initial planning, due diligence procedures, and agreements between relevant parties, a variety
of controls were agreed to by the BCV. These include, but are not limited to, shipment inspection under
Closed Circuit Television (CCTV) or dual control; the BCV warranting that it will not distribute to any
party under sanctions by OFAC, EU, UK, or UN; only the transfer to a pre-approved list of licensed
Venezuelan banks; sharing of BCV and bank compliance policies; and providing AML and CFT
documentation. The BCV must obtain DoS approval prior to distributing banknotes to Venezuelan banks
for their customers.

Controls are applied across nine operational stages described and as seen in the figure below. The Banknote
Control Process begins with (1) authorization and initiation, which establishes formal approval of the
Banknote FX Intervention before any currency disbursement occurs. This is followed by the (2) secure
shipment of banknotes using specialized logistics and security escorts to mitigate transit risks. Upon arrival,
(3) receipt and secure storage protocols verify the physical intake and prevent unauthorized access at high-
security facilities. Once deposited, (4) counting and serial number capture processes verify exact quantities
and register unique serial numbers to establish a robust audit trail and detect defective notes. Prospective
recipient data are collected from the banks and enable the DoS and KPMG review (5) prior to DoS
authorization. Next, the (6) preparation of allocations for commercial banks establishes procedures for the
precise packaging and staging of earmarked funds, which are then formally handed over during (7) bank
collection and confirmation to legally transfer custody. The serialized currency is then released for (8)
distribution to verified end recipients. Finally, the process concludes with (9) financial and performance
reporting to consolidate transaction data, evaluate program metrics, and perform final reconciliation.

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1. Identify Populations: To account for inherent variations in transaction frequency, recipient profiles,
transfer amounts, and distinct operational characteristics, each transaction type (e.g., banknotes,
electronic transfers, etc.) needs to be sampled as a separate population.
2. Apply Exclusion Criteria: Recipients previously identified as high risk and recipients with
transactions totaling $0 as there are no funds at risk in the transactions.
• Apply Recipient Type Grouping: Transaction categories include Venezuelan Individuals,
Venezuelan Domestic Legal Entities, and Foreign / Other. This facilitates representation and
analysis of each Recipient Type's operational footprint.
3. Create Census Stratum: Prior to drawing the statistical sample, “Transactions” amounts are
aggregated at the recipient level, and a census review is conducted on Recipients with total transactions
above a desired threshold.
4. Draw Statistical Sample: In selecting the sample, recipients and their aggregated transactions are
sorted by their unique identifier. Random numbers are generated using Stata and a specified random
number of seed. 36 A subset of recipients is selected based on the calculated sample size and these
recipients undergo EDD reviews. EDD will not be conducted for recipients of transactions if the
recipient has already been reviewed in the prior 12-month period. Previously identified high-risk
recipients are tracked for the next 12-month period to prevent them from receiving any Banknote
Distributions until they are removed from the high-risk recipient list. This helps isolate new recipients
of transactions who have not undergone a due diligence review in the past year. Using transaction-level
details alongside a census review of large transaction recipients, the sampling framework generates
representative samples tailored to transaction volume and variance, focused on EDD of unreviewed,
high-impact recipients, delivering actionable error-rate projections and anomaly detection to safeguard
program integrity.

7.6 Vendor Payments

In addition to foreign exchange interventions, authorized funds may be disbursed on behalf of the interim
Government of Venezuela directly to vendors and service providers supporting governmental purposes,
critical goods, services, and operational needs. Between March 6, 2026 and September 30, 2026, $133.11
million has been disbursed through vendor payments.

Venezuelan law requires that any payments denominated in USD be processed by the BCV. Pursuant to
Convenio Cambiario N°1, USD transactions between Venezuelan entities and vendors must be settled
through the Cámara de Compensación en Moneda Extranjera, a centralized mechanism administered by the
BCV used to clear and settle foreign-currency payments. 37 Because vendor payments involve contractual
obligations, identifiable counterparties, cross-border payment flows, and varying levels of commercial and
compliance risk, they are subject to a risk-based review and approval process. This process incorporates
documentation requirements, compliance screening, appropriate governance approvals, and targeted due
diligence measures to assess transaction legitimacy, sanctions compliance, financial integrity, and diversion
risks prior to disbursement. The following sections outline the governance framework, review
methodology, and oversight processes supporting vendor payments from the Venezuela Custody Account.
Disbursements are handled consistent with E.O. 14373 and do not constitute use of funds in the Venezuela
Custody Account for commercial activity in the United States.

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 Transaction Background & Details: Description of underlying operations, physical flow of
goods, jurisdictions involved, and detailed vendor/contract sourcing rationale.

 Corporate Governance & Ownership: Articles of Incorporation, active physical addresses, and
capitalization tables detailing the corporate structure down to individual UBOs / individual
persons.

 Contractual & Invoicing Terms: Signed contracts, transfer pricing agreements, itemized
transaction schedules, default/breach protocols, and explicit delivery timelines.

 Invoicing & Pricing Details: Itemized invoices, underlying supplier invoices, market price
comparisons, and corporate bank routing credentials.

 Post-Delivery Execution Verification: Shipping bills of lading, receiving documents, and
physical quality inspection sign-off forms.

Complete information at the outset enables streamlined assessment of associated risks, minimizes the
additional outreach, and expedites approval.

7.6.3 Transaction Due Diligence

The transaction due diligence review process serves as a key control designed to establish a comprehensive
understanding of each request, including the requesting entity, relevant counterparties, business activities,
ownership considerations, potential integrity risks, and the purpose of the proposed transaction. As part of
this process, KPMG performs risk-based due diligence to assess whether the payment is consistent with
program objectives, applicable control requirements, and the intended use of funds.

Prior to KPMG’s engagement as technical advisor to undertake transaction due diligence in April 2026,
Citibank reviewed each proposed vendor payment submitted by the BCV and facilitated by Citibank
through Citibank’s applicable sanctions, AML, CFT, and Anti-Bribery and Corruption programs, which are
designed to identify potentially high-risk parties, unusual payment activity, and other financial crime
indicators. After KPMG was engaged as a technical advisor, KPMG reviewed past payments facilitated by
Citibank, maintaining visibility into previously approved disbursements. Open communication between
KPMG and Citibank has continued, supporting continuity of review and access to information concerning
payments processed before KPMG’s involvement.

Building on recognized AML review methodologies, among other risk assessment best practices, KPMG
applies a risk-tiered assessment approach based on factors such as transaction value, industry sector,
geographic exposure, counterparty profile, and supporting documentation. Reviews may include sanctions
screening, reputational and regulatory assessments, beneficial ownership analysis, and other targeted due
diligence procedures designed to identify potential compliance, integrity, or diversion risks. The level of
monitoring and control activities applied to each payment may vary based on the assessed level of risk,
with additional due diligence activities potentially ranging from outreach directly to the transaction
counterparties, in-person diligence and site visits, coordination with OFAC to confirm license compliance,
or performing due diligence on additional parties related to the transacting entity. The results are provided
to the DoS to support approval, rejection, escalation, or implementation of additional risk mitigation
measures.

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8. Stage 4: Controlled Disbursement

A key objective of the financial oversight program is to support the transparent and controlled disbursement
of natural resource revenues into the Venezuelan economy for the benefit of the Venezuelan people. The
DoS has executed disbursements from the Venezuela Custody Account, in accordance with requests from
the interim Government of Venezuela and consistent with approved expenditure parameters. 38 After
authorization for FX Interventions and Vendor Payments, funds enter the final stage of the lifecycle. This
stage tracks the movement of authorized funds through each mechanism, providing clear visibility into the
specific institutions, entities, and sectors receiving funds.

The analysis begins with a high-level review of how funds move from the Venezuela Custody Account
through a controlled disbursement process. Following review and approval by the DoS and the U.S.
Treasury, funds are distributed directly from the Venezuela Custody Account to approved vendors and
service providers.

Funds transferred to a BCV operational account are primarily used to support FX interventions through
participating commercial banks. The account is also used to facilitate approved operational and
administrative expenses necessary to support program execution, including banking services, payment-
messaging services, and other approved operational disbursements.

The sections that follow examine these activities from initial disbursement through downstream receipt.

8.1 Outflow from the BCV

Between January 15, 2026, and September 30, 2026, $12.11 billion was disbursed through the channels
described above. The figure below illustrates the movement of funds from natural resource revenue
deposited through custody, allocation, and disbursement activities. The analysis traces how deposits entered
the Venezuela Custody Account, the mechanisms through which funds were disbursed, and the sectors
represented within the available downstream transaction data. The channels in the figure below include the
three mechanisms that encompass FX Interventions: legacy auctions, electronic interventions, banknote
interventions, as well as vendor payments, consistent with E.O. 14373.

Confidentiality Flag: This section includes depositor-specific information and insights that may be subject
to confidentiality and NDA requirements.

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8.3 Downstream Recipients

This section details how program funds were distributed across key sectors of the Venezuelan economy.
By analyzing recipient industries and mapping downstream corporate entities, the data shows how USD
were used after leaving intermediary banks and the economic sectors represented within the reported
recipient population.

Following the primary disbursement of funds from the Venezuela Custody Account into a BCV operational
account, USD were distributed into the Venezuelan domestic banking system. To understand the
relationship between primary, intermediary, and downstream recipient populations, it is important to
distinguish between transfers made to participating commercial banks and the subsequent allocation of
USD to individual and corporate customers.

The outflow ledger presented in Section 8.2 reflects transfers to participating commercial banks, vendors,
and other registered recipients. The recipient analysis presented in this section reflects a separate stage of
the distribution process and is based on downstream transaction data reported by participating commercial
banks to the BCV and subsequently provided to the DoS and KPMG for review and analysis. The recipient
statistics presented below reflect combined downstream recipient activity across both the Electronic FX
Intervention and Banknote FX Intervention mechanisms. Accordingly, the bank-level disbursements
discussed in Section 8.2 and the recipient-level information presented below represent different layers of
the same USD distribution framework. These activities can be viewed through three related tiers:

1. Primary Disbursements (Custody to Operations): Funds are transferred from the Venezuela
Custody Account to a BCV operational account for approved foreign exchange activities. These
transactions represent the initial release of funds from custody and form the basis of the outflow
reporting presented in Section 8.2.
2. Intermediary Disbursements (Operations to Commercial Banks): The BCV allocates USD from
its operational account to the U.S. correspondent and custodial accounts supporting participating
Venezuelan commercial banks. These allocations represent the intermediary stage between fund
release and downstream customer activity. Most of the disbursements presented in Section 8.2
reflect transfers at this level.
3. Downstream Recipient Activity (Commercial Banks to End Recipients): Participating
commercial banks subsequently distribute USD to individuals and corporate entities through
regulated USD-denominated account activity and regulated foreign exchange mechanisms. These
transactions are executed under customer identification, due diligence, and AML/KYC
requirements maintained by participating financial institutions and applicable banking regulations.
Recipient information analyzed in this section is derived from data reported by participating
commercial banks to the BCV and subsequently provided to the DoS and KPMG for analysis and
classification.

8.3.1 Recipient Analysis

All individual and corporate entities engaging in this process have been reported by the BCV and classified
using the Venezuelan tax identification system and identification number for Register of Fiscal Information

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Total $9,366,606,862.44

Figure 28: Recipients in Sectors from Sample 46

By examining recipient sectors, the figures above help provide greater visibility in how funds flow beyond
the initial disbursement stage and where liquidity was ultimately distributed. This disbursement pattern
demonstrates that program resources are not only reaching individuals but also, critically, areas that directly
affect the Venezuelan population by providing access to essential goods, services, and critical
infrastructure.

9. Ongoing Monitoring Plan & Strategy

9.1 Ongoing Monitoring Plan

This report supports a broader oversight and monitoring effort meant to bring transparency and
accountability to Venezuela’s natural resource sector. The work completed during the period covered by
this report involved analysis of vast amounts of data provided by the BCV and other stakeholders across a
range of financial, operational, and regulatory data sources.

The information presented in this report should be viewed as a point-in-time assessment based on the data
and documentation available as of September 30, 2026.

Beyond the reporting activities reflected herein, the oversight team has been actively implementing
enhanced monitoring capabilities, data governance processes, and technology solutions designed to
enhance financial oversight and further improve transparency. These efforts include developing centralized
data repositories, automating reconciliation capabilities, standardizing reporting frameworks, and
implementing advanced analytic tools that will enable more efficient tracking, monitoring, and reporting of
fund activity across the program lifecycle. Continued monitoring activities may incorporate newly available
financial records, transaction-level data, risk assessments, compliance reviews, and monitoring results as
data integration efforts mature.

This report therefore serves not only as a record of current observations, but as the foundation of a
sustainable oversight framework that will continue to support transparency, accountability, and informed
decision-making.

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1Exec. Order No. 14373, Safeguarding Venezuelan Oil Revenue for the Good of the American and Venezuelan People, 91 Fed.

Reg. 2045 (Jan. 9, 2026).
2 U.S. Department of the Treasury, Venezuela Custody Account records (Qatar National Bank and Foreign Government Deposit

Fund), January 2026–September 2026.
3 Exec. Order No. 14373, Safeguarding Venezuelan Oil Revenue for the Good of the American and Venezuelan People, 91 Fed.

Reg. 2045 (Jan. 9, 2026).
4 The activities discussed in this report were conducted and supported by a number of different entities including KPMG, the DoS’s

technical advisor; the BCV; and BDO, a service provider to the BCV, among others. To enhance readability, the text does not
always specify which entity performed or was involved with specific activities.
5
U.S. Department of the Treasury, Venezuela Custody Account records (Interim Qatar Custodial Account and FGDF); Banco
Central de Venezuela, Operational Account records; and Banco Central de Venezuela, Auction and Intervention Transaction files,
January–September 2026.
6
KPMG analysis of program governance documents.
7 U.S. Department of the Treasury, Venezuela Custody Account Records (Interim Qatar Custodial Account), and Banco Central de

Venezuela, Auction Adjudication Records (Base de Datos Subasta), January 2026.
8
U.S. Department of the Treasury, Venezuela Custody Account Reporting ledger; Banco Central de Venezuela, Interim Qatar
Custodial Account Remittance and Transfer records (January 2026); and VCA FedInvest Reporting records, January–September
2026.
9 U.S. Department of the Treasury, Venezuela Custody Account Reporting ledger, January–September 2026.
10 Exec. Order No. 13850, Blocking Property of Additional Persons Contributing to the Situation in Venezuela, 83 Fed. Reg. 55243

(Nov. 2, 2018); Exec. Order No. 13884, Blocking Property of the Government of Venezuela, 84 Fed. Reg. 38843 (Aug. 7, 2019).
11
U.S. Department of the Treasury, Venezuela Custody Account Reporting ledger, January–September 2026; Petróleos de
Venezuela, S.A. (PDVSA), Treasury Office Payments records, September 2026.
12
U.S. Department of the Treasury, Venezuela Custody Account Reporting ledger, January–September 2026.
13
Program governance and deposit intake protocols.
14
U.S. Department of the Treasury, Venezuela Custody Account Reporting ledger, January–September 2026.
15
U.S. Department of the Treasury, Venezuela Custody Account Reporting ledger, January–September 2026.
16
KPMG analysis of program disbursement workflows.
17
KPMG analysis of program disbursement workflows.
18 Banco Central de Venezuela, Distribution of Monetary Policy, 2026.
19 Banco Central de Venezuela, Exchange Intervention Diagrams, August 2024.
20 Banco Central de Venezuela, Auction and Intervention Transaction Files, January–September 2026.
21 Banco Central de Venezuela, Foreign Exchange Intervention Allocation Proposals, April–September 2026.
22
Banco Central de Venezuela, TRANSFERENCIAS A LA BANCA AL 040926 (Excel workbook), September 4, 2026.
23 U.S. Department of the Treasury, Venezuela Custody Account Reporting ledger, January–September 2026.
24
U.S. Department of the Treasury, Venezuela Custody Account Reporting ledger, January–September 2026.
25 SUDEBAN, Resolución N° 010.25: Normas Relativas a la Administración y Supervisión de los Riesgos de Legitimación de

Capitales, Financiamiento al Terrorismo y Financiamiento de la Proliferacion de Armas de Destruccion Masiva (LC/FT/FPADM)
Aplicables a las Instituciones del Sector Bancario, March 20, 2025
26 Banco Central de Venezuela and Moneycorp Bank Limited, Wholesale Banknote Agreement, effective June 30, 2026.
27 Banco Central de Venezuela and Numisma Bank, Banknote Master Services Agreement, effective July 1, 2026.
28 Banco Central de Venezuela, Receipt of Banknotes Numisma, July 30, 2026.
29 KPMG analysis of banknote delivery data. See Figure 16, "Banknote Distributions."
30
KPMG analysis of banknote delivery data. See Figure 16, "Banknote Distributions."
31
KPMG analysis of banknote delivery data. See Figure 16, "Banknote Distributions."
32
Banco Central de Venezuela, Intervention Transaction files, January–September 2026.
33
KPMG analysis of Banknote Distribution process.
34 KPMG is developing Process Narratives and Assessment Programs Guides (APGs) for each payment type: Banknotes, Electronic

Transfers, Invoices.
35
DoS Approved process based on industry-standard practices.
36 StataCorp, Stata Statistical Software: Release 18 (College Station, TX: StataCorp LLC, 2023).
37
Convenio Cambiario N° 1, Gaceta Oficial N° 6.405 Extraordinario, September 7, 2018.
38 Exec. Order No. 14373, Safeguarding Venezuelan Oil Revenue for the Good of the American and Venezuelan People, 91 Fed.

Reg. 2045 (Jan. 9, 2026).
39
U.S. Department of the Treasury, Venezuela Custody Account records (Interim Qatar Custodial Account and FGDF); Banco
Central de Venezuela, Operational Account records; and Banco Central de Venezuela, Auction and Intervention Transaction files,
January–September 2026.

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40
U.S. Department of the Treasury, Venezuela Custody Account records (Qatar Custody Account and FGDF); Banco Central de
Venezuela, Operational Account records, January–September 2026.
41
U.S. Department of the Treasury, Venezuela Custody Account records (QNB and FGDF); Banco Central de Venezuela,
Operational Account records, January–September 2026.
42
Banco Central de Venezuela, Auction and Intervention Transaction files, January–September 2026.
43
Banco Central de Venezuela (BCV), Auction and Intervention Transaction Files, January–September 2026.
44 Banco Central de Venezuela (BCV), Auction and Intervention Transaction Files, January–September 2026.
45 Banco Central de Venezuela (BCV), Auction and Intervention Transaction Files, January–September 2026.
46
Banco Central de Venezuela (BCV), Auction and Intervention Transaction Files, January–September 2026.

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