2014 gave us lots to talk about in terms of international news.
Sanctions, OFAC violations, and restricted party screening lapses are just some of the ways that export compliance issues snuck into worldwide headlines this past year:
Sanctions Against Russia
A slew of economic sanctions against Russia was the United States’ response to the invasion of the Ukrainian territory of Crimea. Unfortunately, many American corporations felt the pain in their own pocketbooks. When Visa and MasterCard stopped providing services in Russia, the decrease in revenue growth for U.S. companies was significant. Fast food giant McDonald’s closed three of its Crimean locations and then faced Russian consumer backlash. Debate regarding the effectiveness of the sanctions continues.
The Mystery of Malaysian Airlines
In 2014 we were saddened and baffled by the disappearance of Malaysian Airlines Flight 370 and all of its 239 passengers. As scant few pieces of the puzzle began to come together, it was revealed that two of the ill-fated passengers held passports that had been previously reported stolen. Although there’s no evidence to indicate this had anything to do with the tragic loss of the plane, it does raise questions about the airline’s restricted and denied party screening practices. Had the Malaysian authorities screened all passenger passports against Interpol’s database of stolen travel documents, would the flight’s fate have been changed? We may never know.
OFAC Obligations
2014 was a tough year to be a European bank. Overseas banks and financial services institutions made the news with a host of OFAC violations related to involvement with sanctioned countries like Iran and Sudan. French powerhouse BNP Paribas led the way with the largest fine ever imposed by OFAC, a whopping $9 billion. In the aftermath of the settlement, two other French financial institutions were investigated for lending money to U.S. sanctioned countries, while Italian and German organizations faced inquiries of their own. In other OFAC news this year, a major player in the travel/tourism industry was hit with a $5,990,490 fine for facilitating holidays in Cuba for sun-seeking Europeans. The company’s head office is in the Netherlands, but U.S. companies have been in control of it for several years, rendering it subject to sanctions on Cuba. The frustrating conundrum for American travel companies doing business in Europe came to light: if they refuse to book travel to Cuba, they’re in violation of European Union (EU) law. Talk about a Catch-22!
International export compliance news promises to be just as interesting in 2015. Here’s hoping for peace and goodwill across the globe. Happy Holidays!