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Old Sanctions Fears Stall New Myanmar Trade

By JOEL SCHECTMAN -  The Wall Street  Journal

Five months after returning home from a work trip in March to Asia, Daniel Rathbun received a letter from SunTrust Bank STI -0.26%. Mr. Rathbun, the bank wrote, had violated its policy by accessing his account from a computer in Myanmar, a country on which the U.S. has placed economic sanctions.

The bank wrote that Mr. Rathbun also failed to give SunTrust written notice that he planned to visit Myanmar 15 days before his trip, which the letter stated was his duty as an account holder. “Any further violation of the above procedures may result in the closing of your deposit accounts,” the bank officer wrote in an August letter reviewed by the Wall Street Journal.

Mr. Rathbun was annoyed and refused to return a form detailing his financial activity over the last 12 months, as the bank requested. The blanket ban on Myanmar had ended years ago, and now the U.S. is promoting trade with the country. In fact, Mr. Rathbun, an international development expert at the consulting firm DAI, visited the country as part of a proposed U.S.-backed project to help build Myanmar’s agricultural sector. “I wrote back and told the bank that the U.S. Commerce Department had posted a person full time in Myanmar to promote trade,” Mr. Rathbun told the Wall Street Journal. “They are so out of date.”

SunTrust spokesman Hugh Suhr said he couldn’t comment on the individual account holder but noted that not all sanctions have been lifted on Myanmar, and the bank is obligated to adhere to the remaining sanctions “and act accordingly to avoid any potential for violation.”

It’s been two years since the U.S. eased sanctions on Myanmar, which had amounted to a near-total ban on doing business in the country. The change came after the country’s military regime allowed the formation of a civilian government in 2011. And now, to edge the country’s leaders towards a democratic transition, U.S. diplomats are pushing for American companies to invest in Myanmar.

But those efforts have been hindered by the legacy of sanctions and the increasing care that banks take on compliance after a rash of record fines.

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