German firm fined $5.5 million for sanctions violations

OFAC said the violations were the result of rogue managers at AppliChem continuing illicit exports from Europe to Cuba under the nose of their U.S. owner.

German firm fined $5.5 million for sanctions violations

OFAC said the violations were the result of rogue managers at AppliChem continuing illicit exports from Europe to Cuba under the nose of their U.S. owner.

German firm fined $5.5 million for sanctions violations

OFAC said the violations were the result of rogue managers at AppliChem continuing illicit exports from Europe to Cuba under the nose of their U.S. owner.

 
The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) has fined Darmstadt, Germany-based AppliChem GmBH $5,512,564 for 304 violations of the Cuban Assets Control Regulations.
    The illegal shipments, which were valued at $3,433,495, occurred between May 2012 and February 2016, OFAC said.
    On Jan, 1, 2012, Glenview, Ill.-based Illinois Tool Works (ITW) acquired AppliChem, which manufactures chemicals and reagents for the pharmaceutical and chemical industries.
    While performing its preacquisition due diligence, ITW discovered references to countries subject to U.S. economic and trade sanctions on AppliChem’s website. On Dec. 19, 2011, ITW warned AppliChem management that it must cease all Cuban transactions after the acquisition.
    AppliChem claimed to share U.S. export compliance details with all its European branches upon completing the acquisition. However, the company’s Spanish branch continued to facilitate orders to Cuba through 2012.
   Upon discovery, ITW submitted a voluntary self-disclosure to OFAC on Jan. 23, 2013. In the disclosure, ITW stated that based on representations from AppliChem’s former owners, “all [of AppliChem’s] open [Cuba] transactions were canceled.” On May 29, 2015, OFAC issued a warning letter to ITW in response to AppliChem’s post-acquisition Cuba sales.
    However, on Jan. 27, 2016, an anonymous report was made through the ITW ethics helpline alleging that AppliChem continued sales to Cuba via an intermediary in Berlin. ITW conducted an investigation and found that AppliChem’s former owners had concealed this activity, OFAC said.
    OFAC said this case demonstrates the importance for companies to implement “risk-based controls,” which include conducting routine audits and follow-ups with their overseas management, to ensure subsidiaries are complying with U.S. sanctions regulations.

First-quarter Mexican trade volumes were slower than we had initially anticipated, but we now see solid growth for the rest of the year.

Drewry’s World Container Index, a composite of container freight rates on eight major routes to and from the U.S., Europe and Asia, was down 1.4% to $1,351.15 per 40-foot container as of June 13.

Most Popular
Latest News
Social Media

Loading...

Panalpina in talks with Agility as DSV sweetens its offer

Panalpina in talks with Agility as DSV sweetens its offer

Embed this story

Share Code Version 1

This version will embed the story headline and includes HTML fallback protection, ensuring the story will display even if some users decide to disable javascript in their browsers.

Copy & Paste the following code to embed this story on your website:

Preview

German firm fined $5.5 million for sanctions violations

OFAC said the violations were the result of rogue managers at AppliChem continuing illicit exports from Europe to Cuba under the nose of their U.S. owner.

Feb 15, 2019 on Dec 27, 2018AmericanShipper.com

Share Code Version 2

This version will embed the story headline without any styling applied. Use this version if you will use your own custom styling on your website. This version also includes HTML fallback protection.

Copy & Paste the following code to embed this story on your website:

Preview

German firm fined $5.5 million for sanctions violations

OFAC said the violations were the result of rogue managers at AppliChem continuing illicit exports from Europe to Cuba under the nose of their U.S. owner.

Feb 15, 2019 on Dec 27, 2018AmericanShipper.com