On August 11, 2020, the US Department of the Treasury’s Office of Foreign Assets Control announced a settlement reached with a US person (Person-1) who agreed to pay $5,000 to resolve 24 apparent violations of the Foreign Narcotics Kingpin Sanctions Regulations, 31 CFR part 598 (FNKSR), while working as a civilian in the US Army stationed in the US embassy in Colombia. Person-1 allegedly held a security clearance and many national security-related positions prior to committing these violations.
In 2015, Person-1 was introduced to a specially designated narcotics trafficker (SDNT) who was at the US embassy for a meeting related to designation status. Person-1 knew that SDNT was a specially designated narcotics trafficker, but for one year, engaged in a personal relationship with the SDNT and bought jewelry, meals, clothing and other gifts for the SDNT, while the SDNT sought to change their designation status. According to OFAC, the transaction value for all 24 violations was approximately $3,349.33, but the base civil monetary penalty for the violations was $36,264,793, because the apparent violations were not voluntarily self-disclosed.
The mitigating factors that led OFAC to accept the reduced settlement amount, was that Person-1 cooperated with OFAC’s investigation, was fired and no longer employed by the US government, and significantly disciplined as a result of the violations. In addition, Person-1 had no prior experience with sanctions compliance, and the transactions involved single-use personal gifts with limited secondary value.