Iran Sanctions Violations Net $415,350 Penalty
The Office of Foreign Assets Control reports that an oilfield services company in Singapore has agreed to pay $415,350 to settle potential civil liability for apparent violations of the Iranian Transactions and Sanctions Regulations.
OFAC states that between October 2011 and February 2013 this company, through its subsidiaries, exported or attempted to export 55 orders of oil rig supplies from the U.S. to Singapore and the United Arab Emirates and then reexported or attempted to reexport these supplies to four separate oil rigs in Iranian territorial waters. Although some of the purchase order quotations received from U.S. vendors included specific language warning that such goods could not be shipped or reexported to countries subject to U.S. economic sanctions, specifically including Iran, the company purchased the goods and shipped them to the oil rigs over a period of several years.
The statutory maximum penalty amount for the apparent violations is $13.75 million and the base penalty amount is $923,000. OFAC considered the following to be aggravating factors: (1) the company failed to exercise a minimal degree of caution with respect to these shipments; (2) the company’s exports and reexports aided in the development of Iran’s energy resources; (3) the company is a large, sophisticated company with 14 offshore drilling rigs doing business throughout the world; and (4) the company did not have an OFAC compliance program in place at the time of the transactions despite conducting business in the U.S. and/or with U.S. companies in relation to the offshore drilling and petrochemical sectors. In addition, the company did not voluntarily disclose the apparent violations.
On the other hand, OFAC found that the apparent violations constitute a non-egregious case and considered to be mitigating factors the fact that the company has no prior sanctions history with OFAC, took remedial action by instituting an OFAC sanctions compliance program, and displayed substantial cooperation throughout the course of the investigation.