OFAC issues a Finding of Violation for insufficient response to subpoena regarding contemplated sales of aircraft to Iranian entity

The Office of Foreign Assets Control of the US Department of the Treasury has issued a Finding of Violation to Southern Cross Aviation, LLC, a Florida corporation, for violating the Reporting, Procedures and Penalties Regulations of 31 CFR part 501.  According to OFAC, in response to an administrative subpoena issued by OFAC in June 2016 requesting information about Southern Cross’ involvement in the potential sale of helicopters to Iran via an Iranian businessman in Ecuador, the company first denied any knowledge of such negotiations.  In a subsequent response to the administrative subpoena, Southern Cross said that a company representative in Ecuador had sent technical details to an Ecuadorian group for the sale of helicopters to an Iranian group, for operation in Ecuador, but the company failed to provide adequate documentation about the transaction to OFAC.  Only later, in response to a second administrative subpoena, did the company provide greater detail about the contemplated transaction.

OFAC deemed as aggravating factors the company’s reckless disregard for US sanctions requirements, its failure to provide accurate and complete information in response to OFAC’s administrative subpoena, its failure to cooperate fully with the investigation, and the company’s actual knowledge or reason to know that its conduct violated US sanctions.  However, Southern Cross’ history of no sanctions violations and its small size, and the fact that the contemplated sale never actually took place, were viewed as mitigating factors.

OFAC press release | Enforcement Information

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