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U.S. company to pay $210,000 to settle Sudanese sanctions violations

U.S. company to settle Sudanese sanctions violations

The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) today announced that a Florida company has agreed to pay approximately $210,000 to settle its potential civil liability for 12 apparent violations of the Sudanese sanctions regulations.

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According to an OFAC release [PDF 30 KB], the Florida company leased three aircraft engines to an entity incorporated in the United Arab Emirates that in turn subleased the engines to a Ukrainian airline that then installed the engines on aircraft that were subject to a leasing arrangement with an airline in Sudan. At the time of these transactions, the airline was identified on OFAC’s List of Specially Designated Nationals and Blocked Persons as meeting the definition of “Government of Sudan."

The lease agreements that the Florida company entered into with the UAE company contained a provision prohibiting the lessee from maintaining, operating, flying, or transferring the engines to any countries subject to United States or United Nations sanctions. Notwithstanding this clause, the Florida company did not determine the aircraft engines were used in a manner that complied with OFAC’s regulations. For example, at the time, the Florida company did not obtain U.S. law export compliance certificates from lessees and sublessees, nor did it periodically monitor or otherwise verify its lessee’s and sublessee’s adherence to the lease provision requiring compliance with U.S. sanctions laws during the life of the lease. As a result, the Florida company learned of this information when its engines had actually flown only after the engines were returned to it at the end of the lease.


For more information on this topic or to learn more about KPMG’s Trade & Customs Services, contact:

Doug Zuvich
Partner and Global Practice Leader
T: 312-665-1022
E: dzuvich@kpmg.com

John L. McLoughlin
Principal and East Coast Leader
T: 267-256-2614
E: jlmcloughlin@kpmg.com

Andy Siciliano
Partner and National Practice Leader
T: 631-425-6057
E: asiciliano@kpmg.com

Steve Brotherton
Principal and Global Export and Sanctions Leader
T: 415-963-7861
E: sbrotherton@kpmg.com

Luis (Lou) Abad
Principal, Washington National Tax
T: 212-954-3094
E: labad@kpmg.com

Irina Vaysfeld
Principal
T: 212-872-2973
E: ivaysfeld@kpmg.com

Amie Ahanchian
Principal
T: 202-533-3247
E: aahanchian@kpmg.com

Robert Waldrop
Principal
T: 212-954-8117
E: rwaldrop@kpmg.com

Gisele Belotto
Managing Director
T: 305-913-2779
E: gbelotto@kpmg.com

Christopher Young
Principal
T: 312-665-3229
E: christopheryoung@kpmg.com

Andy Doornaert
Managing Director
T: 313-230-3080
E: adoornaert@kpmg.com

George Zaharatos
Principal
T: 404-222-3292
E: gzaharatos@kpmg.com

Jessica Libby
Managing Director
T: 612-305-5533
E: jlibby@kpmg.com

 

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