Skip to main content
Menu Icon Menu Icon

InfoBytes Blog

Financial Services Law Insights and Observations

OFAC, shipping company settle sanctions violations for $1.1 million

Financial Crimes Department of Treasury OFAC Sanctions Of Interest to Non-US Persons Settlement

Financial Crimes

On January 27, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced a $1,125,000 civil settlement with a Marshall Islands shipping company (respondent) with headquarters in the U.S. for 36 apparent violations of the Burmese Sanctions Regulations (BSR). According to OFAC, between 2011 and 2014, the respondent had dealings in the property of a Burma-related company (company) that is included on the Specially Designated Nationals (SDN List), and provided shipping services that benefited the designated company, which were apparent violations of the BSR.

According to the settlement agreement, OFAC considered various aggravating factors in reaching the settlement amount, including that (i) the apparent violations “conferred significant economic benefits to Burma’s military regime”; (ii) the respondent “demonstrated reckless disregard for U.S. sanctions requirements by ignoring” the license denial letters it received from OFAC; (iii) the respondent’s former president knew about and participated in the transactions that comprise the apparent violations; and (iv) the respondent is a “commercially sophisticated shipping company” that is familiar with international shipping transactions. OFAC determined that the apparent violations represent an egregious case.

OFAC also considered various mitigating factors, including that (i) the respondent is under new management, which self-disclosed the apparent violations and cooperated with the investigation; (ii) OFAC has not issued a violation against the respondent in the five years preceding the earliest date of the transactions at issue; and (iii) the respondent undertook extensive remedial measures in response to the alleged violations, including implementing a formal compliance program.

Share page with AddThis