A media-related hardware and software systems company settled potential civil liability with OFAC for 52 apparent violations of the Iranian Transactions and Sanctions Regulations ("ITSR") and Executive Order 13628 (Authorization for the Implementation of Certain Sanctions Related to Iran and Syria).

According to OFAC, the company exported 49 products to two distributors located in France and the United Arab Emirates, each of which in turn sold the products to a reseller located in Iran. OFAC claimed that the company allegedly knew or had reason to know the products were intended for Iran, as the agreements with both distributors explicitly included Iran as a country in the distributors' sales territory. OFAC found that the reseller sold three of the exported products to Islamic Republic of Iran Broadcasting, which is a designated entity on OFAC's List of Specially Designated Nationals and Blocked Persons. OFAC stated that in at least three instances, the company provided services, such as software updates and reseller training, to Iranian customers. The total value of the Iran-related transactions was $583,024.

OFAC found that the company (i) did not have in place appropriate export controls or sanctions compliance policies and (ii) incorrectly believed that product sales through a third-country intermediary were in accordance with sanctions regulations. The matter was voluntarily self-disclosed to OFAC, and the agency determined that the conduct was non-egregious.

OFAC charged the company with violations of ITSR sections 560.204 ("Prohibited exportation, reexportation, sale, or supply of goods, technology, or services to Iran") and 560.206 ("Prohibited trade-related transactions with Iran; goods, technology, or services"), as well as Executive Order 13628. To settle the charges, the company agreed to pay $189,483.

Primary Sources

  1. OFAC Enforcement: OFAC Settles with NewTek, Inc. for Its Potential Civil Liability for Apparent Violations of the Iranian Transactions and Sanctions Regulations

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