The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) today announced a settlement agreement with a California company that agreed to pay almost $1 million for “apparent violations” of the North Korea sanctions regulations.
According to an OFAC release [PDF 106 KB], the company agreed to pay a civil monetary penalty of $996,080 to resolve its potential civil liability for 156 apparent violations of the North Korea sanctions regulations for imports of false eyelash kits from two suppliers located in China that contained materials sourced by these suppliers from North Korea. The eyelash kits were imported during a period from 2012 to 2017, and the total value of the imports was just over $4.4 million.
During the period at issue, the company’s OFAC compliance program was “either non-existent or inadequate.” The company’s production review efforts focused on quality assurance issues pertaining to the production process, raw materials, and end-products of the goods it purchased and/or imported. Until January 2017, the company’s compliance program and its supplier audits failed to discover that approximately 80% of the false eyelash kits supplied by two of the China-based suppliers contained materials from North Korea.
The company voluntarily self-disclosed the apparent violations, and OFAC determined that the apparent violations constituted a non-egregious case.
For more information on this topic or to learn more about KPMG’s Trade & Customs Services, contact:
John L. McLoughlin
Luis (Lou) Abad
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