In a recent regulatory filing, Frequency Electronics, Inc. (FEI), a supplier of precision time and frequency products for military and commercial use headquartered in Long Island, New York, revealed that, following the company’s disclosure of potential sanctions violations to the US Treasury Department’s Office of Foreign Assets Control, OFAC had informed FEI on July 22, 2020 that it is conducting a civil investigation of the matter.
The investigation stems from FEI’s 4.6% investment in Morion, Inc., a subsidiary of Gazprombank OAO, which was designated by OFAC pursuant to Executive Order 13662 in July 2014 for helping to finance destabilizing actions in Ukraine. Executive Order 13662, which was issued after FEI had invested in Morion, prohibits US persons from providing new financing to Gazprombank. As explained by the company, FEI recently engaged external legal counsel to help evaluate whether sales to Morion, and payments to the company by Morion may have inadvertently constituted extensions of credit in violation of Executive Order 13662.
Form 10-K | US Dept of the Treasury press release (July 2014) | Executive Order 13662 (Directive 3)