On 3 September, OFAC announced that Citigroup Inc., based in New York, agreed to pay $217,841 to settle potential civil liability for eight apparent violations of the Iranian Transactions and Sanctions Regulations, the Weapons of Mass Destruction Proliferators Sanctions Regulations, the Global Terrorism Sanctions Regulations and the Kingpin Act.
The apparent violations comprise two separate sets of transactions. Between 2 April 2009 and 16 November 2009, Citigroup Trade Services Malaysia processed four export bill collection applications totalling $638,074.15 on behalf of Citibank N.A., Hong Kong involving shipment of goods to Iran. Two of these transactions involved IRISL, which was sanctioned in 2008 under the Global Terrorism Sanctions Regulations. According to OFAC, employees of the Malaysian entity failed to review or screen the bills of lading, certificates of origin and shipment advice. OFAC determined that Citigroup voluntarily disclosed these apparent violations.
Separately, on four occasions between February 2010 and October 2012, Citibank N.A. processed funds transfers totalling $133,786.73 in the US involving entities appearing on OFAC’s SDN List. According to OFAC, Citibank’s interdiction software failed to identify the references to the sanctioned parties because of minor differences in spelling, and the transactions were processed straight through without manual intervention. OFAC determined that Citigroup did not voluntarily disclose these apparent violations.
In determining the settlement amount, OFAC considered as aggravating factors that Citigroup employees, in reviewing the self-disclosed transactions, did not review underlying documentation that included sanctions references; the apparent violations resulted in harm to US sanctions programs; and Citigroup is a large and commercially sophisticated financial institution. Mitigating these considerations, OFAC noted that no Citigroup managers or supervisors were aware of the transactions; harm to US sanctions programs was mitigated by the fact that several of the transactions were blocked by third-party financial institutions; Citigroup took remedial action to ensure that specific name variations were added to its interdiction filter; Citigroup has not received a penalty notice or Finding of Violation from OFAC in the five years preceding the earliest of these transactions; and Citigroup cooperated with OFAC, including prompt and thorough responses to inquiries and entering into a statute of limitations tolling agreement.