Government Enforcement

The World Bank Group (the Bank) published a joint Sanctions System Annual Report for fiscal year 2019 on October 10. This report, which reflects on the Sanctions System’s growth since its implementation twenty years ago, provides an overview of activities undertaken by the Bank’s Integrity Vice Presidency (INT), Office of Suspension and Debarment (OSD), and

In remarks made at the American Conference Institute’s 20th Anniversary New York Conference on the Foreign Corrupt Practices Act (FCPA) and to the New York City Bar White Collar Crime Institute on May 9, 2018, Deputy Attorney General (DAG) Rod Rosenstein announced two new policy initiatives at the US Department of Justice (DOJ). First,

The US Department of Justice (DOJ) and federal financial regulators announced major public enforcement actions against two large banks with significant international business dealings in February. These enforcement actions resulted in a guilty plea, a deferred prosecution agreement (DPA), and near-record fines and penalties. Both financial institutions failed to comply with Bank Secrecy Act/Anti-Money Laundering

A series of recent federal enforcement actions targeting weaknesses in Bank Secrecy Act/anti-money laundering (BSA/AML) compliance programs continued on March 16, when US Gold refinery Elemetal LLC, based in Dallas, Texas, pled guilty in US District Court for the Southern District of Florida to a single-count information charging failure to maintain an adequate BSA/AML program.

Elemental admitted that from August 2012 through November 2016, it purchased and refined billions of dollars of gold from countries around the world, but willfully failed to develop, implement, and maintain an adequate BSA/AML compliance program, despite the high risk of gold-based money laundering.  The international gold trade is recognized as a common method for laundering illegally mined gold, narcotics and other criminal proceeds.

Federal prosecutors alleged and Elemetal admitted that they had:
Continue Reading Texas-Based U.S. Gold Refinery Pleads Guilty for Failing to Maintain an Adequate Anti-Money Laundering Program and Agrees to Forfeit $15M, Continuing Trend of Criminal Enforcement Actions and Prosecutions for Compliance Failures

Recent joint activity by the Financial Crimes Enforcement Network (FinCEN) and the Office of Foreign Assets Control (OFAC), including joint actions against Venezuela and North Korea, suggest that the two Treasury agencies are increasing coordination to tackle financial and other crimes.

On September 20, 2017, FinCEN issued an advisory which detailed widespread corruption in Venezuela, noting that OFAC has designated a number of Venezuelan public officials for public corruption and narcotics trafficking, including President Nicolas Maduro, Vice President Tareck El Aissami, national assembly leaders, and leaders of national energy company Petroleos de Venezuela (PdVSA).  This tracks a pattern of regular communications and actions by OFAC and FinCEN
Continue Reading FinCEN, OFAC Increase Coordination of Enforcement Activities

Following up on our previous post, yesterday the UK Office of Financial Sanctions Implementation (OFSI) issued regulations formally implementing the civil penalties framework set out in the Policing and Crime Act 2017.  OFSI has issued a press release, regulations regarding civil penalties, responses received to OFSI’s request for consultation regarding draft guidance

The UK’s Office of Financial Sanctions Implementation will soon issue regulations that could significantly alter the British sanctions enforcement environment, and bring it closer in line with the US’s approach to such violations.  On the heels of the newly-enacted Policing and Crime Act 2017, the regulations will introduce civil penalties for the violation of financial

The Treasury Department’s Office of Foreign Assets Control (OFAC) reached a $4,320,000 civil settlement with PanAmerican Seed Company (PanAm Seed) for alleged violations of the Iranian Transactions and Sanctions Regulations (ITSR) that occurred between 2009 and 2012. OFAC treated this as an “egregious case,” which may raise eyebrows because it involved the export of seeds,

On June 22, 2016, the Department of Commerce, Bureau of Industry and Security (BIS), finalized a new enforcement policy for administrative (i.e., non-criminal) matters called the Guidance on Charging and Penalty Determinations in Settlement of Administrative Enforcement Cases (Guidance).  The Guidance, which is effective immediately, lays out the factors that BIS and its Office of

In its second enforcement action this year, on June 20th, the State Department’s Directorate of Defense Trade Controls (DDTC) reached a $100,000 settlement with Massachusetts-based Microwave Engineering Corporation.  Despite the small penalty amount, this case is noteworthy in several respects. 
Continue Reading Massachusetts Company Hit with ITAR Penalty for a Single Individual Deemed Export Violation; Settlement Highlights Importance of Timely Disclosure