A Missouri-based industrial equipment and services company agreed to settle U.S. Treasury Department Office of Foreign Assets Control ("OFAC") charges for violating Belarus Sanctions Regulations.
According to OFAC, Zoltek Companies, Inc. ("Zoltek") submitted a voluntary self-disclosure, after which OFAC initiated an investigation into Zoltek's activities. OFAC's review of Zoltek's submissions identified apparent violations of the Belarus Sanctions Regulations, including dealing in the property of a "blocked person identified on OFAC's List of Specially Designated Nationals and Blocked Persons." Under its agreement with OFAC, Zoltek did not admit that it violated U.S. sanctions.
To settle the charges, Zoltek agreed to pay over $7.5 million and to maintain robust sanction compliance measures designed to lower the risk of recurrence of similar conduct.
Commentary / James Treanor
The most interesting aspect of the Zoltek settlement is the lengthy and detailed description of compliance-related undertakings agreed to by the company, including management's commitment to OFAC compliance, effective internal controls, sanctions risk assessments, testing and auditing, and training. In light of Under Secretary of the U.S. Treasury for Terrorism and Financial Intelligence Sigal Mandelker's recent comments that OFAC soon will be announcing specific "hallmarks of an effective sanctions compliance program," we can expect to hear more on this subject soon.
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