With no major announcements in the past few weeks, I was getting concerned that the United States Department of the Treasury Office of Foreign Assets Control (“OFAC”) had shut down operations. No such chance. OFAC announced yesterday that they will have another symposium in December. This is something new that OFAC has been doing and I for one am a big fan. I think it really makes sense for OFAC to send out representatives to answer questions on the sanctions programs they administer. It not only promotes greater understanding, but greater compliance. The symposium is the the second one OFAC has staged this year and is taking place in New York City on December 1st. Please click here for more information.

Even more exciting than the announcement of another symposium is the announcement of the monthly civil penalties.

This month OFAC has continued their 2009 trend of dishing out monster penalties and accepting big settlements. Two entities find themselves on the list this month, both for violations of the Iranian Transactions Regulations (“ITR”). The first, Barwil Agencies NA, Inc. of Pasadena, TX settled allegations of violations of the ITR for $84,000.00. According to OFAC, Barwil engaged in transactions related to services of Iranian origin and facilitated transactions which involved the payment of port expenses for a vessel’s port call in the Iranian port of Bandar Mahshahr. Although Barwil did not voluntarily disclose the alleged violations to OFAC, the company did cooperate with OFAC’s review of the matter and has made revisions to its compliance program.

The second entity was assessed a civil penalty and apparently their violations were egregious. OFAC hit Gold & Silver Reserve, Inc. with a civil penalty of $2.95 million for violations of the ITR. OFAC announced that during the period between September 2003 and December 2006 Gold & Silver Reserve exported financial services when they activated 56,739 “e-currency” accounts through its website for persons located in Iran. Ouch. That’s alot of separate transactions to be penalized for. What’s more interesting is that OFAC stated the penalty was mitigated down due to the amount Gold & Silver Reserve was going to have to make pursuant to other U.S. government agency actions. The penalty announcement can be read here.

There has been a huge surge in interest around Iranian sanctions recently. I, myself alone, have been interviewed three times this week by different media outlets in regards to the subject. People are really looking as to how we can use trade sanctions to reign in the Iranian nuclear program and what effects of our previous sanctions have had to this point. Obviously its not just the media that is taking notice. OFAC is really active in enforcing these regulations. This is a trend that I reported on earlier in the year and it seems like everyday there is more and more evidence of that trend. Despite this fact, it seems that more and more people are trying to skirt the ITR. If you are one of these people I would think twice. Its clear OFAC is not playing around when it comes to enforcing 31 C.F.R. Part 560 and you do not want to find yourself on the wrong end of a multi-million dollar penalty.

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.