OFAC settles with Swiss technology provider over sanctions violations

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

On February 26, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced a $7.8 million settlement with a Swiss provider of commercial telecommunications and information technology services to the civilian air transportation industry for 9,256 alleged violations of the Global Terrorism Sanctions Regulations. According to OFAC, between April 2013 and February 2018, the company allegedly provided commercial services and software subject to U.S. jurisdiction that may have benefitted certain airlines designated as specially designated global terrorists (SDGTs) pursuant to Executive Order 13224. These sanctioned airlines, OFAC noted, were member-owners in the company’s organization.

In arriving at the settlement amount, OFAC considered various mitigating factors, including (i) OFAC has not issued a violation against the company in the five years preceding the earliest transaction at issue; (ii) the company has undertaken remedial efforts to minimize the risk of similar violations from occurring in the future; (iii) the company cooperated with the investigation and executed multiple tolling agreements; and (iv) the company terminated the membership of the SGDT airlines.

OAC also considered various aggravating favors, including that (i) the company did not voluntarily self-disclose the alleged violations; (ii) the company had actual knowledge that it was providing services and software to SDGTs; (iii) the company’s actions “facilitated the operations of, or otherwise benefitted, airlines that were sanctioned for supporting terrorism”; and (iv) the company is “commercially sophisticated” with operations in every county in the world.