The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) today announced a $100,871,266 settlement agreement with Zhongxing Telecommunications Equipment Corporation and its subsidiaries and affiliates, as well as with ZTE Kangxun Telecommunications Ltd. and its subsidiaries and affiliates (collectively referred to as “ZTE”), to settle ZTE’s potential civil liability for 251 apparent violations of the Iranian Transactions and Sanctions Regulations, 31 C.F.R. part 560 (ITSR). Today’s settlement resolves OFAC’s investigation into ZTE’s multi-year and systemic practice of utilizing third-party companies to surreptitiously supply Iran with a substantial volume of U.S.-origin goods, including controlled goods appearing on the Commerce Control List. ZTE engaged in 251 transactions that appear to have violated §§ 560.203, 560.204, and/or 560.205 of the ITSR. The total value of the transactions constituting the apparent violations was approximately $39,622,972. This action marks OFAC’s largest settlement to date with a non-financial entity.
Today’s OFAC settlement is being entered into simultaneously with ZTE’s agreement to resolve this matter with the U.S. Department of Justice and the U.S. Department of Commerce.
Read more on the settlement below.