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OFAC reaches settlement with Chinese company for alleged Iranian sanctions violations
On December 12, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced a $2,774,972 settlement with a Chinese oilfield services company and its affiliated companies and subsidiaries (collectively, the “group”) for 11 alleged violations of the Iranian Transactions and Sanctions Regulations. According to OFAC, the settlement resolves potential civil liability for the group’s alleged involvement in exporting or re-exporting, or attempts to export or re-export, U.S.-based goods to end-users in Iran through China.
In arriving at the settlement amount, OFAC considered the following as aggravating factors: (i) the group “willfully violated U.S. sanctions on Iran by engaging in and systematically obfuscating conduct it knew to be prohibited by company policy and economic sanctions, and continued to engage in such conduct even after the U.S. Government began to investigate the conduct”; (ii) employees, including management, were aware of the transactions and concealed the nature of the transactions from the U.S.; (iii) the group falsified information and provided false statements to the U.S. during the course of the investigation; (iv) the group’s conduct, which occurred over a period of years, provided economic benefits to Iran; and (v) the group is a commercially sophisticated international corporation.
OFAC also considered numerous mitigating factors, including (i) the group has no prior OFAC sanctions history and has not received a penalty or finding of a violation in the five years before the transactions at issue; (ii) the group has cooperated with OFAC and disclosed possible violations involving other sanctions programs; (iii) the group agreed to toll the statute of limitations; and (iv) the group implemented remedial measures and corrective actions to minimize the risk of reoccurring conduct.
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