Enforcement

A Virginia man was sentenced yesterday to 24 months in prison followed by three years of supervised release for criminal conduct in connection with a scheme to unlawfully export heavy equipment from the United States to Iran by routing the shipments though the United Arab Emirates (UAE).

Commerce officials announced the arrrest of a Los Angeles man for his alleged involvement in a years-long scheme to secure and unlawfully export sensitive technology from the United States for the benefit of a Russian business. 

Assistant Secretary for Export Enforcement Matt Axelrod announced enhancements and expansions of the Bureau's Voluntary Self-Disclosure program, including simplified reporting, e-mail submittals and expedited handling of corrective action for unlawfully exported items. In a speech January 16 at NYU School of Law’s Program on Corporate Compliance and Enforcement Mr. Alelrod described the changes, along with an engaging history of the jukebox, details of which can be found in the complete speech.  

SAP SE (SAP), a publicly traded global software company based in Germany, will pay over $220 million to resolve investigations by the U.S. Justice Department and the Securities and Exchange Commission (SEC) into violations of the Foreign Corrupt Practices Act (FCPA). According to the SEC complaint, from at least December 2014 through December 2018,  SAP employed third-party intermediaries and consultants in various schemes to make improper payments to government officials in order to obtain and retain business in South Africa, Greater Africa (Malawi, Kenya, Tanzania, and Ghana), and Indonesia. Readers may recall SAP’s prior history, which include a non-prosecution agreement from 2021 with the Justice Department’s National Security Division, as well as administrative agreements with the Departments of Commerce and the Treasury relating to Iran-related export law violations, and a resolution in 2016 with the SEC concerning alleged FCPA violations in Panama.

A Virginia lobbyist and a New Jersey political consultant each have entered into Deferred Prosecution Agreements (DPAs) to resolve allegations that they failed to comply with the Foreign Agents Registration Act (FARA) and committed related offenses while representing the government of Qatar. Barry P. Bennett, 60, of Alexandria, Va., owned and operated Avenue Strategies, LLC and Avenue Strategies Global, LLC, a pair of consulting firms in Washington D.C.  Douglas Watts, 73, of Jersey City, N.J., is a former presidential campaign consultant who also founded and ran a lobbying and public relations company. In 2017, Bennett signed a contract for Avenue Strategies to perform lobbying services for the embassy of Qatar. As part of his lobbying strategy on behalf of, and for and in the interest of Qatar, Bennett covertly operated Yemen Crisis Watch, a Limited Liability Company (LLC) founded by Watts at Bennett’s direction. As directed by Bennett and managed by Watts, Yemen Crisis Watch ran a public relations campaign designed to cast Qatar’s rivals, Saudia Arabia and the U.A.E., in a negative light, and thereby to improve Qatar's standing with the U.S. government relative to these rivals.

January 1st,  Treasury’s Financial Crimes Enforcement Network (FinCEN) began accepting beneficial ownership information reports. Reporting companies created or registered to do business in the United States before January 1, 2024 must file by January 1, 2025. Newly created or registered companies: Reporting companies created or registered to do business in the United States in 2024 have 90 calendar days to file after receiving actual or public notice that their company’s creation or registration is effective.

A New Hampshire charity delivering humanitarian aid to Syria was sentenced in federal court for export offenses.   NuDay was sentenced December 28 by U.S. District Court Judge Joseph N. Laplante to five years of probation, the maximum penalty for an organizational defendant.  NuDay was also ordered to pay a $25,000 fine.  On September 8, 2023, NuDay pleaded guilty to three counts of Failure to File Export Information.

The U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) announced a $466,200 settlement with Privilege Underwriters Reciprocal Exchange (PURE). PURE agreed to settle its potential civil liability for 39 apparent violations of OFAC's Ukraine-/Russia-Related sanctions. Based in White Plains, New York, PURE primarily offers insurance policies and coverages for luxury homes, automobiles, art collections, jewelry, and watercraft

Operation Car Wash, the wide ranging graft case involving Petrobras officials and the commodity trading community snared another trophy culprit. Stamford, Connecticut based Freepoint Commodities agreed to pay the DOJ $98 million to resolve an investigation into bribery of Brazilian government officials. The firm has also agreed to pay more than $7.6 million to the Commodity Futures Trading Commission in a related matter.

The elder of two Indiana brothers was sentanced to 200 months in federal prison followed by a lifetime of supervised release, after pleading guilty to attempting to provide material support or resources, namely, firearms, to a designated foreign terrorist organization. Moyad Dannon's  brother, Mahde Dannon, was sentenced to 20 years in prison in October 2021, after pleading guilty to the same charges.  At the time of their arrests (2018) the men were aged 21 and 20, respectively.

The U.S. Treasury on December 11 slapped sanctions on a former Afghan official, his son, and related entities, accusing them of misappropriating millions of dollars of funds provided by U.S. government contracts. The sanctions statement cited former Afghan parliament speaker Mir Rahman Rahmani and his son Ajmal Rahmani. "Through their Afghan companies, the Rahmanis perpetrated a complex procurement corruption scheme resulting in the misappropriation of millions of dollars from U.S. Government-funded contracts that supported Afghan security forces," it said, adding that other family members were also designated.

A California man was sentenced to 18 months in federal prison for conspiring to procure and illegally ship high-end computer servers from the United States to Iran.

Treasury’s Office of Foreign Assets Control (OFAC) is designating 11 entities and seven individuals pursuant to Executive Order (E.O.) 14038 and one individual pursuant to E.O. 14024. This action increases the pressure on Alyaksandr Lukashenka’s authoritarian regime for its suppression of Belarus’s democratic civil society, financial enrichment of the Lukashenka family, and complicity in Russia’s war against Ukraine.

Office of Foreign Assets Control (OFAC) is targeting a network led by Belgian serial offender Hans De Geetere involved in procuring electronics with military applications for Russian end-users. …

The United States will host the 10th session of the Conference of the States Parties (COSP) to the United Nations Convention against Corruption (UNCAC) in Atlanta from December 11-15, 2023.

n a speect to the 40th International Conference on the Foreign Corrupt Practices Act, the Justice Department's FCPA Chief announced an anti-bribery initiative to drive cross-border collaboration in fighting foreign bribery. Acting Assistant Attorney General Nicole Argentieri's comments included the announcement of the International Corporate Anti-Bribery initiative, or ICAB, which will be driven by three experienced prosecutors, who will build on existing bilateral and multilateral partnerships, as well as form new partnerships.

The Public Company Accounting Oversight Board sanctioned PwC China and PwC Hong Kong for violating PCAOB quality control standards related to integrity and personnel management. Both firms failed to detect or prevent extensive, improper answer sharing on tests for mandatory internal training courses. The PCAOB also sanctioned the accounting firm Haoxin and four of its associated persons for violations of the U.S. securities laws and PCAOB rules and standards in connection with the audits of the 2015-2017 financial statements of Gridsum Holding Inc.

Reuters reports semiconductor equipment maker Applied Materials is under U.S. criminal investigation for potentially evading export restrictions on China's top chipmaker SMIC. The largest U.S. …

Two Texas men were convicted at trial on Nov. 15 on charges of attempting to violate the International Emergency Economic Powers Act (IEEPA), conspiracy to violate IEEPA, and conspiracy to commit money laundering in connection with their attempt to transact in sanctioned Iranian petroleum and launder the proceeds. According to evidence presented at trial, in 2019 and early 2020, Zhenyu “Bill” Wang and Daniel Ray Lane engaged in a conspiracy to purchase petroleum from Iran, in violation of economic sanctions imposed by the United States under IEEPA. They then planned to mask the origins of the petroleum and sell it to a refinery in China. The defendants also attempted to conceal their illegal transactions by obtaining foreign passports, engaging in sham contractual agreements, and conspiring to launder the proceeds of the sale through shell entities and offshore financial accounts.

Two U.K.-based reinsurance brokers have agreed to resolve investigations by the Justice Department into violations of the Foreign Corrupt Practices Act (FCPA) arising from a corrupt scheme to pay bribes to Ecuadorian government officials.  Tysers and H.W. Wood each entered into a three-year deferred prosecution agreement (DPA) with the department in connection with a criminal information filed in the Southern District of Florida charging both companies with conspiracy to violate the anti-bribery provisions of the FCPA. 

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