DOJ’s new corporate enforcement policies substantially increase compliance incentives and may lead to more voluntary self-disclosures, law firms said. But they also said much of the new policy will depend on how DOJ implements the changes, and it remains unclear how much of a downstream impact the revisions will have on export control and sanctions cases handled by other agencies.
The Office of Foreign Assets Control Dec. 30 fined a multinational Danish-based refrigeration manufacturer more than $4.3 million for violating U.S. sanctions against Iran, Syria and Sudan. Danfoss, which also sells air conditioners and other cooling and heating products, illegally directed customers in all three countries to make payments through a U.S. financial institution, OFAC said in an enforcement notice. The company also made illegal payments to entities in Iran and Syria.
Export Compliance Daily is providing this recap of export control and sanctions enforcement over the past year to assist export compliance professionals, lawyers and others in staying up to date with current enforcement trends. This guide summarizes the most notable enforcement actions by the Commerce Department's Bureau of Industry and Security, the State Department’s Directorate of Defense Trade Controls, the Treasury Department’s Office of Foreign Assets Control and the Department of Justice since Jan. 1, 2022.
The Treasury Department fined U.S. crypto exchange Kraken $362,158.70 for violating U.S. sanctions against Iran, the agency said this week. Treasury’s Office of Foreign Assets Control said Kraken, also known as Payward, exported services to users who “appeared to be” in Iran and allows them to conduct virtual currency transactions on Kraken’s platform. The violations stemmed from Kraken’s "failure to timely implement appropriate geolocation tools, including an automated [internet protocol] address blocking system," OFAC said.
Cryptocurrency exchange Bittrex was fined more than $24 million by the Office of Foreign Assets Control this week for violating U.S. sanctions. OFAC announced the fine alongside a similar penalty by the Financial Crimes Enforcement Network, which fined the company more than $29 million for violating the Bank Secrecy Act. The OFAC and FinCEN settlements are the two agencies’ first parallel enforcement actions, OFAC’s largest-ever virtual currency enforcement action and the agency's largest fine since April 2019.
The Office of Foreign Assets Control fined Washington-based Tango Card $116,048.60 for violating U.S. sanctions as a result of its “deficient geolocation identification processes,” the agency said last week. OFAC said Tango Card, an electronic gift and reward services company, violated U.S. sanctions related to the Crimea region of Ukraine and sanctions imposed against Cuba, Iran, Syria and North Korea.
The Office of Foreign Assets Control announced two separate settlement agreements this week, fining a Switzerland- and a Monaco-based wealth management company for violating U.S. sanctions. OFAC said both companies committed violations due to “deficiencies” in their sanctions compliance practices.
The Office of Foreign Assets Control reached a settlement with American Express National Bank for $430,500 over apparent violations of the Foreign Narcotics Kingpin Sanctions Regulations, according to a July 15 OFAC notice. Over the course of two months, OFAC said, Amex processed transactions for a card holder who was designated in connection with illegal drug distribution and money laundering.
The Office of Foreign Assets Control last week fined Colorado-based Newmont Corp. and Florida-based Chisu International Corp. after the two mining companies bought Cuban-origin “explosives and explosive accessories” from a third-party vendor. The agency announced a $141,442 settlement with Newmont and a $45,908 settlement with Chisu for violating the Cuban Assets Control Regulations.
The Office of Foreign Assets Control on April 1 fined S&P Global, a business analytics firm, $78,750 for violating U.S. Ukraine-related sanctions regulations. OFAC said the case was non-egreious, partly due to S&P's cooperation and agreement to improve its compliance program.