International Trade Law News

Published by Jacobson Burton Kelley PLLC

The Treasury Department's Office of Foreign Assets Control (OFAC) has issued its monthly list of civil penalties imposed against companies and individuals for violating the sanctions programs administered by OFAC. During August 2004, OFAC imposed more than $300,000 in civil penalties to settle 23 separate enforcement actions for violations of the current or former embargoes imposed by the U.S. on Afghanistan, Cuba, Iran, Iraq, Libya, Sudan and Yugoslavia. During the same period OFAC imposed more than $100,000 in penalities on individuals for alleged violations of the Cuban and Sudan sanctions regulations.

The following is a summary of some of the settlements announced by OFAC:

• OFAC imposed more than $26,000 in penalites on American Express for operating unblocked Cuba accounts, advising a letter of credit relating to Iran and making a funds transfer involving Libya.
• A $64,000 penalty was levied on Sempra Energy Trading Corp. on behalf of Sempra Metal Ltd. for 2002-2004 contracts with a Cuban Specially Designated National (SDN).
• OFAC imposed a $68,750 penalty on Irridelco International Corp., New Jersey-based manufacturer and distributor of agricultural irrigation equipment, for facilitating trade with Iraq in 2001.
• OFAC assessed a $19,200 penalty on the First National Bank of San Diego for operating accounts on behalf of a person designated as a Specially Designated National pursuant to the Foreign Narcotics Kingpin Designation Act and the Foreign Narcotics Kingpin Sanctions Regulations (SDNTK).
• $25,000 penalty was imposed against Dolphin Lagoon, Inc./Dolphin Fantaseas,Inc., an Anguilla-based aquatic park, for entering into a contract with a Cuban entity and for violating the ban on Cuba-related business travel transactions. There are reports that OFAC is negotiating a similar settlement with the owner of the aquatic park for purchasing dolphins from Cuba.
• OFAC levied a $25,000 penalty against an individual for entering into an unspecified contract with a Cuban entity and for engaging in business travel-related transactions with Cuba. OFAC does not release the names of individual persons that enter into settlement agreements.
  
• A $16,500 penalty was assessed on an individual for several violations of the Sudan Sanctions Regulations, including entering into a contract relating to Sudan, facilitation of trading with Sudan and attempted evasion of the regulations.