The Treasury Department’s Office of Foreign Assets Control (OFAC) today issued a “finding of violation” to a credit card company concerning issues involving banks in Iran, in violation of certain Executive Orders. No penalty notice was issued.
According to the OFAC release [PDF 144 KB], the Iranian banks were listed as “specially designated nationals and blocked persons” on the SDN list. Before the Executive Orders were issued, the Iranian banks had maintained accounts with the credit card company. After the Executive Orders were issued, the Iranian bank accounts became dormant on the credit card company’s books. However, the assets in the accounts remained with the credit card company, and it then failed to report the accounts to OFAC (a violation of U.S. regulatory provisions).
The OFAC found that issuing a “finding of violation” was the appropriate action in this matter because, among other items: (1) no personnel of the credit card company appeared to have actual knowledge of the funds even though the company was “a large and commercially sophisticated company that…should have identified and reported the accounts…on the SDN list…”; (2) the funds never reached the sanctioned parties; (3) the credit card company cooperative with the investigation; and (4) there had been no similar violations by the credit card company for the previous five years.
For more information, contact a professional with KPMG’s Trade & Customs practice:
Douglas Zuvich | +1 (312) 665-1022 | firstname.lastname@example.org
Andrew Siciliano | +1 (631) 425-6057 | email@example.com
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.