OFAC Settles Civil Enforcement Action with Dutch Company for Alleged Violations of US Trade Embargo on Cuba

The US Treasury’s Office of Foreign Assets Control (OFAC) and Carlson Wagonlit Travel B.V. (CWT), a Netherlands-based company, have agreed to settle violations of the Cuban Assets Control Regulations (CACRs) dating back to as early as August 2006. Under OFAC’s Cuba Penalty Schedule, the voluntarily disclosed activity exposed CWT to a civil fine of up to $11,093,500. The parties, however, agreed to settle the matter for $5,990,490. This settlement shows that even with the EU Understanding and individual EU member states blocking statutes in place, European companies with US owners can be subject to an OFAC enforcement action.

What You Need to Know

- The EU-US Understanding on Cuba did not preclude OFAC from threatening an enforcement action or CWT B.V. from agreeing to settle apparent violations of the CACRs.

- Any company (including a foreign company) owned by US persons is subject to all the requirements of the CACRs.

- The fine is one of the largest ever assessed on a travel agency for violating US sanctions targeting Cuba and Cuban nationals.

- It is never too late to conduct an internal review of one’s compliance controls, implement adequate procedures and policies, or make a voluntary disclosure.

- Although the US government has recently eased some of the Cuban travel restrictions, US persons are still expressly prohibited from traveling to Cuba without a license.

Please see full memo below for more information.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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