Loading ...
Sorry, an error occurred while loading the content.

Treasury Discloses Fines on Violators

Expand Messages
  • Walter Lippmann
    LAW FROM THE ARCHIVES: March 5, 2002 Treasury Discloses Fines on Violators Of Trade Embargoes in Recent Years By MICHAEL M. PHILLIPS Staff Reporter of THE WALL
    Message 1 of 1 , Aug 1, 2002
    • 0 Attachment
      FROM THE ARCHIVES: March 5, 2002

      Treasury Discloses Fines on Violators
      Of Trade Embargoes in Recent Years

      Staff Reporter of THE WALL STREET JOURNAL

      WASHINGTON -- The U.S. government has fined more than 100
      companies, banks, churches and other organizations in recent
      years for violating American trade embargoes on Cuba, North
      Korea, Sudan, Haiti and Iran.

      In response to a lawsuit, the Treasury Department's Office
      of Foreign Assets Control for the first time released
      information relating to 10 cases resolved between 1998 and
      2000, including settlements paid by Bank of America Corp.,
      Brown Brothers Harriman & Co. and Banca Nazionale del Lavoro
      of Italy.

      In Bank of America's case, the Treasury found the bank had
      processed a customer's instructions on a payment relating to
      a Cuban ship, a violation of the Trading with the Enemy Act
      and other regulations. The bank, which declined to comment,
      paid the Treasury $11,000 to settle the allegation.

      Banca Nazionale del Lavoro's New York branch paid the
      Treasury $25,000 for allegedly attempting to transfer nearly
      $900,000 related to the financing of another Cuban ship. The
      branch financial-division manager didn't return a call for

      Brown Brothers Harriman's violation came in 1998 when the
      private commercial bank failed to catch a client's
      transaction that ultimately was destined for Cuba. "We made
      a clerical error and passed through instructions that should
      have been caught by our systems," said Donald Murphy, a
      partner in the bank, which paid $20,000 to settle the case.

      "Virtually every single enforcement action taken by the
      Treasury Department against a U.S. company relating to Cuba
      is a result of a technical violation of an OFAC regulation,"
      said John Kavulich, president of the U.S.-Cuba Trade and
      Economic Council Inc., a New York nonpartisan group funded
      by businesses.

      International Commodity Management Inc. of Seattle paid
      $15,000 to settle allegations that it tried to transfer
      $50,000 to an unnamed entity in North Korea to pay the lease
      on a fishing vessel. ICM officials didn't respond to a
      request for comment. Cedars Bank, of Los Angeles, settled
      for $11,000 the Treasury's allegation that it tried to
      transfer more than $100,000 to a business in Iran. Cedars
      Bank Chief Financial Officer Fuad Khoury blamed the incident
      on a clerical error that inserted the word "Tehran" into the
      transfer order.

      Pacific Roller Die Co., of Hayward, Calif., paid $11,000
      after the Treasury concluded the company violated federal
      law by facilitating the export of steel-pipe-making
      equipment to Sudan. Company Vice President Rob Miller said
      Pacific Roller canceled its own sale to Sudan when the
      embargo was imposed but thought it was still permitted to
      accept a $100,000 referral fee for arranging for a foreign
      company to complete the deal in its stead. "We did think we
      had done everything right," he said.

      Treasury settled with the Pentacostal Holiness Church of
      Coconut Creek, Fla., for $2,000 after Customs agents at
      Miami International Airport seized nearly $11,000 from a
      church representative allegedly headed for Cuba. The
      Treasury said the church had failed to obtain an OFAC
      license for humanitarian remittances to Cuba. Church
      officials couldn't be located for comment Tuesday.

      The Treasury Department, which resisted releasing the
      enforcement data for two years, did so after being sued
      under the Freedom of Information Act by Public Citizen and
      the Corporate Crime Reporter, a newsletter that reported the
      settlements. The department said there were 100-150 cases
      during the 1998-2000 period. The Treasury hasn't agreed to
      provide information on any cases occurring since the
      information request took place in 2000.

      The release of the Treasury's enforcement record comes as
      the trade embargo with Cuba is under increasing attack in
      Congress and from business interests. Since 1992, the U.S.
      has loosened aspects of its four-decade trade embargo, and
      now allows direct exports of food, agricultural material,
      health-care products, music, films and other information.
      U.S. commercial activity with Cuba measured an estimated
      $500 million last year, most of it expenditures by U.S.
      citizens traveling in Cuba, the U.S.-Cuba Trade and Economic
      Council says.

      Write to Michael M. Phillips at michael.phillips@...

      Updated March 5, 2002
    Your message has been successfully submitted and would be delivered to recipients shortly.