By Matt Spetalnick and Trevor Hunnicutt
WASHINGTON (Reuters) -The White House has received recommendations for restarting remittances to Cuba but sent some back for further work to craft "innovative options" to ensure that money sent by Cuban Americans to families on the island does not fall into the hands of Cuba's government, a senior U.S. official said on Friday.
President Joe Biden in July asked the Treasury Department and State Department to study the matter and report back on how to allow remittance payments - once a financial lifeline for many Cubans - without Cuba's government and military profiting.
The Biden administration slapped sanctions on Cuban officials and security forces in response to Havana's crackdown on protesters in July.
Strict limits on remittances were imposed by former President Donald Trump, who rolled back a historic rapprochement that his predecessor, Barack Obama, oversaw between the United States and its old Cold War foe.
Biden, who served as Obama's vice president, promised during the 2020 election campaign against Trump to re-enage with Cuba's communist government.
Relations have remained tense, especially since the protests erupted in July amid a severe economic crisis and a surge in COVID-19 infections. Thousands of people took to the streets, angry over shortages of basic goods, curbs on civil liberties, and the handling of the pandemic by authorities. Scores of protesters were arrested.
"We have received the recommendations of the State Department-Treasury Remittance Working Group," the senior Biden administration official told reporters, declining to offer details on those ideas.
"We've sent some of those back because ... what the president has said publicly is that we are willing to restart remittance flows but want to ensure that ... the Cuban military is not deriving benefit," the official added. "We are exploring new and innovative options to try to circumvent the regime."
The official, speaking on condition of anonymity, said Biden has instructed aides reviewing Cuba policy to develop a "third way" that is "tough on the regime and soft on the Cuban people."
Biden's administration is consulting with Democrats and Republicans as well as the Cuban exile community, the official added, while declining to say when a revised approach could be announced.
Biden administration officials are mindful that any easing of restrictions on Cuba could lead to political fallout from conservative Cuban Americans. They make up a large voting bloc in south Florida and mostly backed Trump's tough policies toward Cuba, helping him to win the important swing state last year - though he lost the election to Biden.
(Reporting by Matt Spetalnick and Trevor HunnicuttEditing by Frances Kerry and Will Dunham)