I’ve been busy preparing for two upcoming trials so I haven’t been posting as regularly, however this story was too much to pass up. Before I dive into the story of Robert Cabelly, the former State Department official turned lobbyist who has just been indicted on four counts of violating the Sudanese Sanctions Regulations, one count of money laundering, one count of passport fraud, one count of conspiracy, and one count of making false statements, I should state that I also do quite a bit of federal criminal defense. Really, it was the criminal penalties found in the sanctions regulations that got me hooked on U.S. sanctions law. Therefore, Mr. Cabelly’s situation is the exact reason why I have been trying so hard all these years to raise awareness about U.S. sanctions; there are really serious consequences to violating these laws that effect more than just your wallet.

For those of you unfamiliar with the story, a US federal grand jury handed down an eight-count indictment of Mr. Cabelly charging him with those crimes stated above.

Mr. Cabelly who heads up PR and lobbying firm, C/R International, is now facing 20 years in prison for each count of violating the Sudanese sanctions regulations, 20 years for the money laundering charge, five years each for a conspiracy charge and a false statement charge, and 10 years for the passport fraud charge.

Mr. Cabelly is alleged to have lobbyied on behalf of Sudan after informing the Office of Foreign Asset Control (OFAC) and the Department of Justice, that he had terminated his lobbying contract with the government of Sudan. At one point Mr. Cabelly had received a license from OFAC through which he could lobby on behalf of Sudan. Prior to that, Cabelly is accused of providing consulting services to Sudan through its embassy in Washington “related to government relations, public relations, the acquisition of surveillance technologies, and the development of its economy, including the petroleum industry”.

After receiving the OFAC license, Cabelly is alleged to have signed a one-year contract with “a French oil company” for $90,000 plus expenses to provide consulting with respect to its petroleum business in Sudan. This French company was Total. The government alleges that Mr. Cabelly had a letter sent to OFAC which he stated that he did not have any relationship with Total-Soudan. In carrying out such activities, the government alleges he carried out a number of unlawful activities which were in violation of the sanctions regulations and various federal criminal statutes.

Cabelly appeared in U.S. District Court in Washington yesterday and had pleaded not guilty. He was released on his own recognizance.

In regards to the indictment, OFAC Director, Adam Szubin commented that, “The activities detailed in this indictment – including facilitation of Sudanese oil transactions – would represent serious violations of U.S. sanctions law. We commend our federal law enforcement colleagues for their dedicated and collaborative efforts.”

There is a sense amongst some individuals that the benefits of violating the sanctions regulations outweigh the risks. This is a subject which I have written upon several times recently. Well that sense is wrong. Dead wrong. OFAC has been very aggressive in dishing out major civil penalties this year. However, there is more to the enforcement arm of the sanctions regulations than just fines and settlements; there are massive criminal penalties. At 20 years imprisonment per violation it’s definitely not something you want to risk. I think we will be seeing more of these types of charges from the Department of Justice, so as always get a lawyer and stay on the right side of the sanctions regulations.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC litigation. If you have any questions please contact him at 202-280-6370 at 202-351-6161 or ferrari@ferrari-legal.com.