Ameron International pays $434,700 for Illegal Transactions with Iran and Cuba

2013/12/04

By: Brooke Driver

Ameron International Corporation of Pasadena, California recently settled with OFAC for violations of both the Iranian Transactions and Sanctions Regulations and the Cuban Assets Control Regulations that occurred between March 14, 2005 and October 5, 2006. Ameron was accused of:

  • Approving its Singapore and Dutch subsidiaries’ requests to purchase tools and equipment necessary for them to fulfill orders for a South Pars project located in Iran,
  • Passing along to its subsidiaries Iranian business opportunities in order to sidestep preventative U.S. Government regulations, and
  • Providing testing results to its Singapore subsidiary, despite the fact that Ameron professionals had reason to believe that they would be sent to the Iranian company Arvand Petrochemical.

U.S. companies should learn from this case that they may not approve or facilitate another party’s dealings with Iran or Iranian entities. The first two violations above involved the acts of approving subsidiaries requests and passing on business leads. In the third case, Ameron exported tech data to Singapore with knowledge or suspicion that the data was intended to be forwarded on to the Iranian entity.

Ameron also violated the CACR when its Columbian branch sold concrete pipe to a conglomerate that included a Cuban partner.

The company was hit with a relatively significant penalty in this case, because its Iran-related violations involved intentional actions to violate the rules or to try to get around the rules in an illegal fashion. In other words, if you do things wrong on purpose, you pay more.

The base penalty for Ameron’s collected offenses is $690,000. OFAC stated that it arrived at the settlement amount of $434,700 based on the following factors:

  • The case was ruled non-egregious
  • Ameron did not voluntarily disclose
  • Ameron’s management and supervisory staff acted with reckless disregard of U.S. sanctions requirements
  • Ameron had reason to suspect the involvement of the Iranian and Cuban entities in the transactions with its foreign subsidiaries
  • Two of the apparent violations (the approvals of the two capital expenditure requests) caused significant harm to U.S. sanctions program objectives on Iran
  • Many violations involved transactions that were never completed
  • Ameron had not committed any violations in the five years prior to the date of these illegal transactions
  • Ameron has taken remedial steps to improve its compliance program
  • Ameron cooperated with OFAC throughout the investigation

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