US Company Settles With OFAC on Apparent Violations of Foreign Narcotics Kingpin Sanctions

A trade credit insurer will settle for about $345,000 after it violated the Foreign Narcotics Kingpin Sanctions Regulations, the Treasury’s Office of Foreign Assets Control said in an Aug. 16 enforcement notice. The company, Maryland-based Atradius Trade Credit Insurance, allegedly completed transactions with sanctioned entities.

In 2016, OFAC said, ATCI was assigned to collect a $5.7 million debt owed by Grupo Wisa, a U.S.-sanctioned entity, by a U.S. cosmetics company. ATCI filed a claim in Panama as a creditor and received a $4 million payment from the liquidation of Grupo Wisa’s assets in Panama, OFAC said. By completing the transaction, ATCI “appears to have dealt in property or interests in property” of a designated narcotics trafficker, the notice said. ATCI did not voluntarily self-disclose the violations.

OFAC said aggravating factors included the fact that ATCI “did not undertake any meaningful analysis or otherwise seek confirmation” from OFAC that the transactions were prohibited and that ATCI is a “sophisticated global trade credit insurance and collections conglomerate.” The agency said mitigating factors included the fact that ATCI has not received a penalty or violation notice from OFAC in the previous five years, and the facts that ATCI began an internal review of the conduct, provided OFAC documents from the review for the investigation and “took voluntary remedial action” to address the cause of the violations. The company also agreed to “undertake certain compliance commitments” to strengthen its compliance program, OFAC said.

“This enforcement action draws particular attention to transactions related to the assignment of [a Specially Designated National’s] debt and highlights the importance of obtaining a specific license before engaging in activity that is not otherwise authorized,” OFAC said.