OFAC Settles with an Individual for $133,860 with Respect to Potential Civil Liability for Apparent Violations of Iranian Transactions and Sanctions Regulations (Excerpts)

December 8, 2021

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A natural U.S. person (“U.S. Person-1”) has agreed to pay $133,860 to settle their potential civil liability for apparent violations of the Iranian Transactions and Sanctions Regulations. The apparent violations were committed between February 2016 and March 2016 when U.S. Person-1 accepted payment in the United States on behalf of an Iran-based company selling Iranian-origin cement clinker to another company for a project in a third country.

Description of the Conduct Leading to the Apparent Violations

Over a two-month period in 2016, U.S. Person-1 arranged for, and received, four payments totaling $133,860 into his personal bank account in the United States on behalf of an Iranian cement company. These payments were for Iranian-origin clinker, a cement precursor, that the Iranian company supplied to a project in a third country. U.S. person-1 coordinated and further facilitated the sale of the clinker with a family member working at the Iranian cement company by relaying logistical and shipping information to the purchasing company.

U.S. Person-1 knew or had reason to know that accepting payments for or on behalf of the Iranian cement company and that facilitating the export of goods from Iran was prohibited. Previously, U.S. Person-1 had submitted a license request to OFAC to authorize other transactions with Iran; that request was denied. In its denial letter to U.S. Person-1, OFAC listed and detailed the prohibitions involving Iran. U.S. person-1 also received information from the Iranian company that identified the sanctions imposed against Iran and described complications the Iranian company had faced when attempting to receive U.S. dollar payments in the past. OFAC did not find that U.S. Person-1 received significant, if any, financial benefits from their conduct. In accepting the payments and coordinating the sale, U.S. Person-1 appears to have violated §§ 560.204, 560.206, and 560.208 of the Iranian Transactions and Sanctions Regulations, 31 C.F.R. part 560 (“ITSR”) on at least four occasions, specifically through:

  1. exporting financial services to a company in Iran;
  2. engaging in transactions or dealings related to the sale of Iranian-origin clinker on behalf of an Iranian company; and
  3. facilitating four transactions that violate the prohibitions of §§ 560.204 and 560.206.

Although U.S. Person-1’s facilitation of the payments involved a family member, § 560.550 of the ITSR generally authorizes certain personal remittances to or from Iran only if the transactions are “noncommercial.” OFAC found the underlying transactions to be commercial, and thus unavailable for the authorization found in § 560.550.