An instrumentation manufacturer settled potential civil liability for alleged violations of the Iranian Transactions and Sanctions Regulations.
According to OFAC, the company exported 21 shipments of product to two European countries, which in turn re-exported the shipments to Iran. OFAC alleged that the company failed to respond to “multiple warning signs” from its European trade partners, including that:
– the European trade partners stated their interest in Iran and inquired on the company’s supplier;
– the company and a European trade partner entered into a Sales Representative Agreement that “explicitly listed” Iran as a permissible country to re-sell the company’s goods;
– a European trade partner claimed internal issues would delay a shipment, to which the company offered to directly ship its goods to the end-user. The European trade partner rebuffed the offer, and OFAC stated that the company “did not question or follow up on this obfuscation”; and
– a European trade partner requested that the company remove “Made in USA” labels, explaining that “the Iranian end-user may have problems with the stated origin of the products.” The request prompted the company to seek advice from outside counsel, but the company still exported two shipments to the trade partner.
In all, between July 16, 2013 and March 25, 2017, OFAC found that the company exported 21 prohibited shipments, with a total transaction value of approximately $687,189.
OFAC explained that the company voluntarily self-disclosed the violations, and that the violations constituted a non-egregious case. OFAC cited as a mitigating factor that the company requested that the final two shipments be returned. For one shipment, the trade partner complied, and the company reimbursed it; for the second shipment, the trade partner refused to comply, and the company asserted that it forfeited approximately $66,900 in payment “rather than accept funds involving an Iranian end customer.”
To settle the charges, the company agreed to pay a $216,464 civil monetary penalty.
Source » mondaq