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Corporate Sector

Articles

Three Designations and a Removal: Recent Major Companies Targeted by OFAC and Their Implications

May 15, 2020
By: Anna Sayre, CSS, Director of Content, ACSS

No matter how large or influential, any company that violates sanctions runs the risk of being placed on the U.S. Treasury Office of Foreign Assets Control (OFAC)’s Specially Designated Nationals (SDN) List. Once a company is considered an SDN, all U.S. persons and entities are generally prohibited from dealing with that company and all of the company’s U.S. assets are immediately frozen. (more…)

Recent OFAC Settlements with Non-Financial Companies and Lessons Learned

November 4, 2019 By: Thomas Nollner*

A commonly held misconception within the sanctions industry is that Office of Foreign Assets Control (OFAC) sanctions programs only apply to financial institutions. Recent large civil liability settlements between OFAC and several large banking companies support this misconception. As published in the international press, Standard Chartered Bank reached a settlement agreement with OFAC in April 2019 for an apparent violation by paying OFAC $639 million; Societé Génerale S.A. in November 2018 reached a settlement agreement for the same type of apparent violation by paying OFAC $53 million; and J.P. Morgan Chase in October 2018 paid $5 million to OFAC for an apparent violation.

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Lessons from the Euroturbine Case: Global Trends and Enhanced Due Diligence Essential to Safeguard Your Business

February 21, 2019 By: Jan Verloop*

On February 18, 2019, Euroturbine B.V. (Euroturbine), a Dutch supplier of specialist parts for gas and steam turbines, was fined for the illicit export of so-called ‘dual-use’ items with full knowledge that the items would eventually reach Iran.‘Dual-use’ items are those goods, products or technologies, normally used for civilian purposes but which may have military or Weapons of Mass Destruction related applications. As turbine engines and parts are made of high alloy materials, and can be used to power a number of military vehicles, they are considered ‘dual-use’ for export purposes, and cannot be exported without permission from the Dutch government.

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The Zoltek Experience: Six Lessons for U.S. Companies with Foreign Subsidiaries

February 4, 2019 By: Scott Nance and George Voloshin

On December 20, 2018, the Office of Foreign Assets Control (OFAC) published a penalty notice and settlement agreement with Zoltek Companies, Inc., a U.S. producer of carbon fiber. OFAC found that Zoltek had violated U.S. sanctions laws due to its Hungarian subsidiary, Zoltek ZRT, having purchased inputs from a Specially Designated National (SDN) in Belarus. Zoltek agreed to pay a substantial fine of $7,772,102 and to implement various measures to ensure it would not commit future violations.

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Between a rock and a hard place: How to ensure sanction compliance when operating a facility in a sanctions-targeted country

June 13, 2017
By Simon Hirsbrunner and Alice Lauterjung

The recently reported resignation of cement manufacturer LafargeHolcim’s CEO has thrown a spotlight on the risks of operating commercial activities in countries targeted by economic sanctions. Without drawing any conclusions on the legal qualification of LafargeHolcim’s conduct in the specific circumstances, the following provides an overview of the principal issues at stake in this case. (more…)

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