OFAC continue their focus on corporates

OFAC have just announced a $5 million settlement agreement with a Hong Kong and China based firm, Sojitz (Hong Kong) Limited. The fine was for US dollar cross-border transactions relating to trade with Iran for Iranian-origin high density polyethylene resin (HDPE) purchased in Thailand. This continues the general trend of more focus and fines for sanctions violations by corporates.

The settlement agreement provides details of employees hiding and removing information from their compliance team and going ahead with payments even when informed not to.


Takeaways are the obvious:

  • Employees (at all levels) need to be open, honest and transparent about country of origin information and not remove this information or obscure it from compliance teams
  • If ‘errors’ happen then self-disclosure is always the right course of action. Total value of USD transactions was $75 million so the fine could have been a lot more had they not self-disclosed (up to $150 million given an egregious violation).

And perhaps most obvious, if you are to trade in goods with Iranian provenance, don’t pay in US dollars!