The Office of Foreign Assets Control has announced an agreement with the Union de Banques Arabes et Françaises (UBAF), resolving the bank’s potential civil liability for 127 apparent violations of Syria-related sanctions.
According to OFAC, UBAF processed 114 internal transfers on behalf of Syrian entities between August 2011 and April 2013, totaling nearly $1,297,652. Of these, 45 involved funds transfers between two UBAF customers – one a sanctioned Syrian entity and one a non-sanctioned entity—that were cleared through a US bank. The remaining 69 internal transfers involved foreign exchange transactions on behalf of a sanctioned UBAF customer that were cleared through the US. OFAC identified 13 additional transactions totaling approximately $781,688,120 that involved sanctioned Syrian persons for whom UBAF performed trade finance transactions through a US bank. In OFAC’s assessment, these 127 transactions constituted apparent violations of Executive Orders 13582 and 13382.
In determining the monetary penalty, OFAC took into consideration UBAF’s demonstrated knowledge of OFAC sanctions laws, and the bank’s incorrect belief that it could avoid sanctions violations if it did not engage in direct US dollar clearing on behalf of sanctioned parties. OFAC deemed as aggravating factors the bank’s reckless disregard for its sanctions compliance obligations, actual knowledge of the potentially sanctionable conduct on the part of UBAF’s management, and the economic benefit conferred on sanctioned persons. OFAC viewed as mitigating factors the timing of the apparent violations immediately following implementation of Executive Order 13582, the existence of a compliance program at UBAF, the bank’s recent violation-free history, and subsequent compliance and mitigation measures taken by the bank.
In light of these factors, OFAC determined on a settlement amount of $8,527,500, a little more than half of the base civil monetary penalty applicable to the matter.
US Dept of the Treasury press release | OFAC enforcement release