On Oct. 20, 2008, Department of Commerce, Bureau of Industry and Security (“BIS”) entered a settlement agreement with American Rice, Inc. (“ARI”), pursuant to which ARI agreed to pay a $30,000 civil penalty to settle allegations that ARI violated the anti-boycott provisions of the Export Administration Regulations (“EAR”) between 2002 and 2006 by failing to report to the Department of Commerce receipt of requests to engage in a restrictive trade practice or boycott, as required by the EAR, in connection with the sale or transfer of goods to the United Arab Emirates. The 15 requests were for certificates stating that relevant ships were allowed by Arab authorities to call at Arabian ports.  

BIS Enforcement

On Sept. 26, 2008, BIS entered into a settlement agreement with Marysol Technologies, Inc. (“Marysol”), pursuant to which Marysol agreed to pay a $180,000 civil penalty to settle allegations that it committed nine violations of the EAR in connection with exporting laser equipment to the PRC, India, Belarus, and Russia between 2003 and 2006 without the required export licenses.  

On Oct. 16, 2008, BIS ordered that NEAZ Trading Corporation (“NEAZ”), its representatives, agents, assigns, and employees may not participate in any transaction involving the export of an item subject to the EAR for seven years after a default order pursuant to a charging letter, including a charge based on NEAZ exporting items subject to the EAR to a Pakistani organization listed on BIS’s Entity List.  

On Oct. 16, 2008, BIS ordered that Yasmin Ahmed may not participate in any transaction involving the export of an item subject to the EAR for seven years after a default order pursuant to a charging letter, including four violations of the EAR, based on his actions as a sales representative of Advance Technical Systems of Dubai, U.A.E., in connection with unlawful shipments of U.S.-origin radar parts made to Pakistan through the U.A.E. Ahmed was the Chief Operating Officer of NEAZ.  

On Oct. 31, 2008, BIS entered into a settlement agreement with Cabela’s Incorporated (“Cabela’s”), pursuant to which Cabela’s agreed to pay a $680,000 civil penalty to settle allegations that it committed 152 violations of the EAR in connection with exporting optical sighting devices without the required licenses to Argentina, Brazil, Canada, Chile, Mexico, Finland, India, Ireland, Malaysia, Malta, Pakistan, Philippines, South Africa, Sweden, and Taiwan, between 2004 and 2005.  

On Nov. 4, 2008, BIS determined that Michelle Geslin and Peter Goldsmith were each guilty of one violation of the EAR by aiding and abetting the unlicensed export of a vessel to Cuba during a regatta they helped to organize in 2003. Each was assessed an $11,000 civil penalty, and both are prohibited from participating in any transaction involving the export of an item subject to the EAR for three years.  

On Nov. 28, 2008, BIS entered into a settlement agreement with PC Universe (“PCU”), pursuant to which PCU agreed to pay a $37,500 civil penalty to settle allegations that it committed one violation of the EAR in connection with selling, transporting, and forwarding digital audio tape drives to Iran without authorization in 2006.  

On Dec. 3, 2008, BIS ordered an extension of a temporary denial order prohibiting Galaxy Aviation Trade Company Ltd., Hooshange Seddigh, Hamid Shakeri Hendi, Hossein Jahan Peyma, Iran Air, and Ankair from participating in any transaction involving the export of an item controlled under the EAR. BIS further ordered the denial of related parties Yavuz Cizmeci, Sam David Mahjoobi, and Intelligent Aviation Services Ltd. from participating in any transaction involving the export of an item controlled under the EAR. The orders are intended to prevent imminent violation of the EAR based on previous unlicensed re-exports of U.S.-origin aircraft parts to Iran.  

On Dec. 11, 2008, BIS entered into a settlement agreement with Beuhler Limited (“Buehler”), pursuant to which Buehler agreed to pay a $200,000 civil penalty to settle allegations that it committed 81 violations of the EAR in connection with the unlicensed export and re-export of chemical mixtures to Taiwan, Israel, Thailand, and Iran between 2001 and 2006.

On Dec. 11, 2008, BIS entered into a settlement agreement with Gunnar Petzel Medizintechnik, pursuant to which Gunnar Petzel Medizintechnik agreed to pay a $50,000 civil penalty to settle allegations that it committed three violations of the EAR in connection with the export of station microplate processing conveyor systems and power supply units to Cuba via Germany without authorization, between 2003 and 2006.  

On Dec. 11, 2008, BIS entered into a settlement agreement with Engineering Physics Software, Inc. (“EPS”), pursuant to which EPS agreed to pay a $130,000 civil penalty to settle allegations that it committed 22 violations of the EAR in connection with the export of software programs to Iran and end-users in India and Pakistan listed on BIS’s Entity List without authorization, between 2003 and 2006.  

On Dec. 16, 2008, BIS entered into a settlement agreement with Interpoint Corporation (“Interpoint”), pursuant to which Interpoint agreed to pay a $200,000 civil penalty to settle allegations that it committed 39 violations of the EAR in connection with the export of DC-to-DC converters and/or electromagnetic interference filters to an entity on BIS’s Entity List in the PRC without authorization, between 2003 and 2005.

On Dec. 16, 2008, BIS entered into a settlement agreement with Electronics For Imaging, Inc. (“EFI”), pursuant to which EFI agreed to pay a $32,000 civil penalty to settle allegations that it committed four violations of the EAR in connection with the export of printer parts and components to Syria without authorization in 2004.

On Dec. 22, 2008, BIS entered into a settlement agreement with Syrvet, Inc. (“Syrvet”), pursuant to which Syrvet agreed to pay a $250,000 civil penalty to settle allegations that it committed 38 violations of the EAR in connection with the export of electronic cattle prods to end-users for whom export licenses had expired prior to export, between 2003 and 2006.  

OFAC Enforcement

On Oct. 3, 2008, the Department of Treasury, Office of Foreign Assets Control (“OFAC”) announced that Myers Industries, Inc. (“Myers”), of Akron, Ohio, remitted $16,250 to settle allegations of a violation of the Cuban Assets Control Regulations. OFAC alleged that in April 2004, a foreign subsidiary of Myers made an unlicensed sale of goods in which Cuba or a Cuban national had an interest.  

On Oct. 3, 2008, OFAC announced that Center for Cross Cultural Study, Inc. (“CC-CS”), of Amherst, Mass., remitted $15,000 to settle allegations of violations of the Cuban Assets Control Regulations in connection with its operation of semester-abroad programs on behalf of various licensed U.S. colleges and universities during March 2003 – January 2004.  

On Oct. 3, 2008, OFAC announced that Priceline.com, Incorporated (“Priceline”), of Norwalk, Conn., remitted $12,250 to settle allegations of violations of the Cuban Assets Control Regulations in connection with foreign subsidiaries’ provision of travel-related services in which Cuba or Cuban nationals had an interest, between September 2004 and November 2007.  

On Nov. 7, 2008, OFAC announced that Iridex Corporation (“Iridex”) remitted $7,500 to settle allegations of violations of the Sudanese Sanctions Regulations in connection with the export of goods without a license between 2004 and 2005 to an entity located in Sudan.  

In Nov. 7, 2008, OFAC announced that Cotech, Inc. (“Cotech”), of Tuxedo Park, N.Y., remitted $6,000 to settle allegations of violations of the Sudanese Sanctions Regulations by attempting to facilitate the shipment of goods from Sudan to Bangladesh in 2004.  

On Nov. 7, 2008, OFAC announced that International Golden Foods, Inc. (“IGF”), of Bensenville, Ill., remitted $3,150 to settle allegations of violations of the Iranian Transactions Regulations by attempting to import goods of Iranian origin without a license in 2003.  

On Dec. 5, 2008, OFAC announced that Eni Petroleum Co. Inc. (“Eni”), of Houston, remitted $6,562.70 to settle allegations of violations of the Iranian Transactions Regulations by facilitating the exportation of goods or services to Iran without a license in 2003.  

On Dec. 5, 2008, OFAC announced that Premier Agency Inc. (“Premier”), of Jamaica Queens, N.Y., was assessed a $7,500 civil money penalty for a violation of the Burmese Sanctions Regulations when Premier did not respond to a Requirement to Furnish Information regarding a funds transfer in 2005 and 2006.  

On Dec. 5, 2008, OFAC announced that one individual was assessed a penalty of $7,500 for violation of the Burmese Sanctions Regulations for failure to respond to a Requirement to Furnish Information letter regarding a funds transfer in 2006 and 2007.  

DO J Enforcement

On Nov. 17, 2008, the Department of Justice (“DOJ”) announced that Shu Quan-Sheng (“Shu”) pleaded guilty to a three-count criminal information relating to violations of the Arms Export Control Act by willfully exporting space launch data to China, and the Foreign Corrupt Practices Act (“FCPA”) by offering money to PRC officials to secure a related contract. Shu faces a possible maximum sentence of 10 years in prison and a fine of $1 million for each violation of the Arms Export Control Act, and a possible maximum sentence of five years in prison and a fine of $250,000 or twice the gross gain for violating the FCPA.  

On Nov. 21, 2008, the DOJ announced that Aibel Group Ltd. (“Aibel Group”), a United Kingdom corporation, pleaded guilty to a two-count information charging a conspiracy to violate the antibribery provisions of the FCPA, and a violation of the FCPA. Aibel Group admitted that it was not in compliance with a deferred prosecution agreement it entered into with the DOJ in February 2007 regarding the same underlying conduct. Beginning in 2001, Aibel Group’s predecessor company and affiliated companies conspired with others to make at least 378 corrupt payments totaling approximately $2.1 million to Nigerian customs service officials in an effort to induce those officials to give preferential treatment during the customs process related to a deepwater oil drilling operation. Aibel Group is a wholly owned subsidiary of Vetco International Ltd., and various other Vetco entities have agreed to pay a combined $26 million criminal fine for FCPA violations. Aibel Group agreed to pay a $4.2 million criminal fine, and is ordered to serve a two-year term of organizational probation that requires, among other things, that it submit periodic reports regarding its progress in implementing antibribery compliance measures.  

On Dec. 10, 2008, the DOJ announced that Misao Hioki, a Japanese national and former general manager of his company’s International Engineered Products Department, pleaded guilty to felony charges relating to a conspiracy to rig bids, fix prices, and allocate market shares of marine hose in the United States and elsewhere, as well for his role in a conspiracy to violate the FCPA by making corrupt payments to government officials in Latin America and elsewhere to obtain and retain business between 2004 and 2007. Hioki is the ninth individual to plead guilty in the marine hose bid-rigging investigation, and the first to plead guilty in the FCPA conspiracy. Hioki agreed to pay an $80,000 criminal fine for participating in both conspiracies.  

On Dec. 15, 2008, the DOJ announced that Siemens Aktiengesellschaft (“Siemens AG”), a German corporation, and three of its subsidiaries, pleaded guilty to violations of and charges relating to violations of the books and records provisions of the FCPA. Beginning in the mid-1990s, Siemens AG engaged in systematic efforts to falsify its corporate books and records, and circumvented and knowingly failed to implement existing internal controls. As a result, Siemens AG made payments totaling approximately $1.36 billion. Approximately $554.5 million was paid for unknown purposes, $341 million was in direct payments to business consultants for unknown purposes, and the remaining $805.5 million was intended in whole or in part as corrupt payments to foreign officials in connection with the U.N. Oil for Food Program, Argentine business, Venezualan business, and Bangladeshi business. Siemens AG agreed to pay a $448.5 million criminal fine, and Siemens Argentina, Venezuela, and Bangladesh each agreed to pay a $500,000 criminal fine. Siemens AG additionally agreed to retain an independent compliance monitor for a four-year period. In a related civil matter with the SEC, Siemens AG agreed to pay $350 million in disgorgement of profits. Finally, in a related matter with the Munich Public Prosecutor’s Office, Siemens AG agreed to pay approximately $569 million in a fine and disgorgement.  

On Dec. 19, 2008, the DOJ announced that James K. Tillery, a former executive, and Paul G. Novak, a consultant of Willbros International Inc. (“WII”), a subsidiary of Willbros Group Inc. (“Willbros”), were charged in conspiring the make more than $6 million in corrupt payments to Nigerian and Ecuadorian government officials in violation of the FCPA. The bribes were allegedly paid in order to obtain and retain gas pipeline construction and rehabilitation business from state-owned oil companies between 2003 and 2005. Tillery and Novak each face sentences up to 35 years in prison and fines of $250,000, or twice the pecuniary gain or loss from the offense, whichever is greater, for conspiring to violate the FCPA and for each violation of the FCPA, as well as $500,000, or twice the value of the funds involved in the transfer, whichever is greater, for a related money laundering conspiracy. Willbros and WII entered into a deferred prosecution agreement with the DOJ and agreed to pay a $22 million criminal penalty in connection with the corrupt payments in March 2008.  

On Dec. 22, 2008, the DOJ announced that Fiat S.p.A. (“Fiat”), an Italian corporation, agreed to pay a $7 million penalty for illegal kickbacks paid to officials of the former Iraqi government by three of its subsidiaries in connection with the U.N. Oil for Food program. Fiat acknowledged responsibility for the actions of its three subsidiaries. Subsidiaries Iveco S.p.A. and CNH Italia S.p.A. were each charged with one count of conspiracy to commit wire fraud and to violate the books and records provisions of the FCPA, and subsidiary CNH France S.A. was charged with conspiracy to commit wire fraud in connection with payments made between 2000 and 2002 totaling approximately $4.4 million to the Iraqi government by inflating the price of contracts by 10 percent before submitting the contracts to the U.N. for approval, and concealing from the U.N. the fact that the price contained a kickback to the Iraqi government. In recognition of Fiat’s thorough review of the illicit payments and its implementation of enhanced compliance policies and procedures, the DOJ has agreed to enter into a deferred prosecution agreement of criminal charges against Fiat and its three subsidiaries for a period of three years. In a related matter, Fiat reached a settlement agreement with the SEC and agreed to pay a $3.6 million civil penalty and $7,209,142 in disgorgement of profits in connection with the contracts for which its subsidiaries paid kickbacks to the Iraqi government.