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OFAC sanctions Russian bank for providing assistance to Venezuelan oil company
On March 11, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions against a Moscow-based bank for materially assisting Venezuela’s state-owned oil company, which was sanctioned earlier this year by OFAC pursuant to Executive Order 13850. (See previous InfoBytes coverage here.) The bank, which is jointly owned by Russian and Venezuelan state-owned companies, “materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of,” the previously sanctioned entity. According to OFAC, the bank was also identified as “the primary international financial institution willing to finance” the Venezuelan cryptocurrency, Petro, which was allegedly created to help former President Maduro’s regime circumvent U.S. sanctions. As a result, any assets or interests therein belonging to the bank, as well as any entities directly or indirectly owned 50 percent or more by the bank that are subject to U.S. jurisdiction are blocked and must be reported to OFAC. U.S. persons are also prohibited generally from dealing with any such property or interests.
Visit here for continuing InfoBytes coverage of actions related to Venezuela.
Danish company pays approximately $33 million to resolve bribery allegations
A Danish company that makes protective coatings used in maritime environments announced on March 4 that it had settled bribery allegations with the Danish State Prosecutor for Serious and International Crime by paying a $33 million fine. The company self-reported what it called “illegal sales practices found in Germany, other countries in Europe, and in Asia” in April 2017.
CFTC adds self-reporting of foreign corrupt practices by non-registrants to cooperation program
On March 6, the CFTC issued an enforcement advisory announcing that it would add violations of the Commodity Exchange Act involving foreign corrupt practices to its cooperation and self-reporting program. The CFTC will recommend no civil monetary penalty where companies and individuals which are not registered (or required to be registered) with the CFTC timely and voluntarily disclose such violations. Full cooperation and appropriate remediation would also be required. In announcing the enforcement advisory, the CFTC’s Director of Enforcement stated at the ABA’s National Institute on White Collar Crime that the change “reflects the enhanced cooperation between the CFTC and our law enforcement partners like the Department of Justice.” He also stated that the agency currently has open investigations into various foreign corrupt practices that violate the Commodity Exchange Act, including bribes that “secure business in connection with regulated activities,” manipulation of benchmarks, “prices that are the product of corruption [being] falsely reported to benchmarks,” and corrupt practices altering the commodity markets.
Foreign financial institutions warned: Will face sanctions for Maduro regime transactions
On March 6, National Security Advisor Ambassador John Bolton issued a statement warning foreign financial institutions that they will face sanctions if it is determined they have been involved in facilitating illegitimate transactions benefiting former President Maduro’s regime.
See here for continuing InfoBytes coverage of actions related to Venezuela.
OFAC issues continued extension of Ukraine-related General Licenses
On March 6, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced the issuance of Ukraine-related General Licenses (GL) 13K and 15E, which extend the expiration date of previous Ukraine-based GLs to July 6, 2019 for wind-down transactions for certain companies that otherwise would be prohibited by Ukraine-Related Sanctions Regulations.
GL 13K supersedes GL 13J and authorizes, among other things, activities and transactions “ordinarily incident and necessary” for (i) the divestiture of the holdings of specified blocked persons to a non-U.S. person; and (ii) the facilitation of transfers of debt, equity, or other holdings involving specified blocked persons to a non-U.S. person. GL 15E, which supersedes GL 15D, relates to permissible activities with the designated company and its subsidiaries, and applies to the maintenance and wind-down of operations, contracts, and agreements that were effective prior to April 6, 2018.
Visit here for additional InfoBytes coverage on Ukraine sanctions.
OFAC sanctions Venezuelan security officials connected to Maduro regime
On March 1, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions against six Venezuelan security officials connected to former President Maduro’s “illegitimate regime.” According to OFAC, the sanctions, taken pursuant to Executive Order 13692, designate the individuals in response to actions taken by groups under their control that have obstructed the delivery of humanitarian aid. As a result, any assets or interests therein belonging to the identified individuals, as well as any entities directly or indirectly owned 50 percent or more by such individuals that are subject to U.S. jurisdiction are blocked and must be reported to OFAC. U.S. persons are also prohibited generally from dealing with any such property or interests. OFAC also refers financial institutions to Financial Crimes Enforcement Network advisories FIN-2017-A006 and FIN-2017-A003 for further information concerning the use of the U.S. financial system and real estate market by Venezuelan government agencies and individuals to launder corrupt proceeds.
See here for continuing InfoBytes coverage of actions related to Venezuela.
CFPB studies elder financial abuse reported in SARs
On February 27, the CFPB’s Office of Financial Protection for Older Americans released Suspicious Activity Reports on Elder Financial Exploitation: Issues and Trends, which discusses key facts and trends revealed after the Bureau analyzed 180,000 elder exploitation Suspicious Activity Reports (SARs) filed with Financial Crimes Enforcement Network from 2013 to 2017. Key highlights from the report include:
- SARs filings on elder financial abuse quadrupled from 2013 to 2017, with 63,500 SARs reporting the abuse in 2017.
- Nearly 80 percent of the SAR filings involved a financial loss to an elder or to the filing institution. The average amount of loss to an elder was $34,200, while the average amount of loss to a filer was $16,700.
- Financial losses were greater when the elder knew the suspect, with an average loss of $50,000 when the elder knew the suspect compared to $17,000 with a stranger.
- More than half of the SARs involved a money transfer.
- Less than one-third of elder abuse SARs acknowledge that the financial institution reported the activity to a local, state, or federal authority.
DOJ charges two more in Venezuelan bribery scheme
In an indictment unsealed on February 26, the DOJ charged a former sales representative and the president of a U.S.-based company with conspiracy to commit bribery, wire fraud, and money laundering, and substantive wire fraud, for their alleged roles in “a scheme to corruptly secure business advantages, including contracts and payment on past due invoices, from Venezuela’s state-owned and state-controlled energy company.” The indictment alleges that from approximately 2009 to 2013, the sales representative and the president of the company conspired to bribe three of the energy company officials in exchange for providing advantages to the unnamed company, including through the creation of fictitious invoices from Panamanian shell companies.
According to the indictment, in exchange for the bribes the energy company officials allegedly assisted the company in obtaining additional energy company contracts, inside information, and payment on past due invoices. The defendants are also alleged to have received kickbacks in connection with the scheme. In total, the sales representative is alleged to have received over $985,000 and the president of the company over $258,000 in kickback payments. Two of the three officials that the defendants are accused of bribing have pleaded guilty in connection with the case and are pending sentencing.
U.K. oil and gas services company sets aside $280 million for bribery settlements with multiple countries
On February 20, a London-based oil and gas services company, reported in a filing with the SEC that it has set aside $280 million as an estimate for the settlement of investigations by U.S., Brazilian, and French law enforcement authorities regarding potential violations of anticorruption laws in several countries. The company’s predecessor previously paid $338 million to settle FCPA charges brought by the DOJ and the SEC in 2010.
OFAC sanctions Venezuelan governors aligned with Maduro regime
On February 25, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions against four Venezuelan governors connected to former President Maduro’s “illegitimate regime.” According to OFAC, the sanctions, taken pursuant to Executive Order 13692, designate the individuals for engaging in “endemic corruption” and allegedly “blocking the delivery of critical humanitarian aid.” As a result, any assets or interests therein belonging to the identified individuals—along with any entities directly or indirectly owned 50 percent or more by such individuals—subject to U.S. jurisdiction are blocked and must be reported to OFAC. U.S. persons are also prohibited generally from dealing with any such property or interests. In addition, OFAC refers financial institutions to Financial Crimes Enforcement Network advisories FIN-2017-A006 and FIN-2017-A003 for further information concerning the use of the U.S. financial system and real estate market by Venezuelan government agencies and individuals to launder corrupt proceeds.
See here for continuing InfoBytes coverage of actions related to Venezuela.