OFAC entered into two separate settlement agreements with a UK-based, U.S.-owned subsea service provider in the oil and gas industry to settle potential liability for apparent violations of the Cuban Assets Control Regulations ("CACR") and the Iran Transactions and Sanctions Regulations ("ITSR").
In connection with the first settlement, Acteon Group Ltd. ("Acteon") and its UK subsidiary, 2H Offshore Engineering Ltd. ("2H Offshore"), agreed to settle seven apparent violations of the CACR stemming from the alleged deceptive practices of 2H Offshore's former Global Director. According to the factual statement contained in the settlement agreement, the Global Director instructed employees to replace the words "Cuba" and "Cuban" in reports, structured contracts and other documents to conceal any Cuba nexus and advised a subordinate to find a way around Acteon's prohibition on work involving Cuba. To settle the charges, Acteon, 2H Offshore and 2H KL (i.e., 2H Offshore's affiliates) agreed to pay $227,500 and undertake certain compliance commitments.
Separately, Acteon agreed to pay $213,866 to settle (i) potential civil liability arising from additional alleged CACR violations; and (ii) the potential civil liability of Acteon's investor-parent company, KKR & Co. Inc. ("KKR"), for alleged ITSR violations. The alleged CACR violations relate to actions by certain Acteon subsidiaries to sell or rent equipment for projects in Cuban territorial waters between 2010 and 2012. With respect to the alleged ITSR violations, in 2014 an Acteon subsidiary allegedly rented or sold equipment to customers who appear to have embarked the equipment on vessels that operated in Iranian territorial waters. OFAC noted that KKR and its affiliated investment funds did not appear to have been directly involved in the apparent violations involving Iran, and the apparent violations involving Cuba pre-dated the acquisition of a majority stake in Acteon by KKR-affiliated investment funds in November 2012.
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