Blockade alive and well

News from Cuba | Thursday, 25 August 2011

Recent fines imposed by the US government's Office for Foreign Assets Control (OFAC) against global financial services firm JP Morgan Chase for processing financial transactions with Cuba show that the Obama administration is still focused on punishing trade with Cuba.

This month, JP Morgan Chase was fined $111 million for violations under the Cuban Assets Control Regulations, which prohibits processing financial transactions with Cuba on the grounds that the country is a "state sponsor of terrorism". The company agreed to pay $88 million in settlement to the US Treasury Department.

Full text from the US Treasury Department below:

Release of Civil Penalties Information

- JPMorgan Chase Bank, N.A. Settlement

​JPMorgan Chase Bank N.A. Settles Apparent Violations of Multiple Sanctions Programs:

JPMorgan Chase Bank, N.A, New York, NY ("JPMC") has agreed to remit $88,300,000 to settle potential civil liability for apparent violations of: the Cuban Assets Control Regulations ("CACR"), 31 C.F.R. part 515; the Weapons of Mass Destruction Proliferators Sanctions Regulations ("WMDPSR"), 31 C.F.R. part 544; Executive Order 13382, "Blocking Property of Weapons of Mass Destruction Proliferators and Their Supporters;" the Global Terrorism Sanctions Regulations ("GTSR"), 31 C.F.R. part 594; the Iranian Transactions Regulations ("ITR"), 31 C.F.R. part 560; the Sudanese Sanctions Regulations ("SSR"), 31 C.F.R. part 538; the Former Liberian Regime of Charles Taylor Sanctions Regulations ("FLRCTSR"), 31 C.F.R. part 593; and the Reporting, Procedures, and Penalties Regulations ("RPPR"), 31 C.F.R. part 501, that occurred between December 15, 2005, and March 1, 2011.

This settlement covers the following apparent violations of the CACR, WMDPSR, and RPPR, which OFAC has determined were egregious:

JPMC processed 1,711 wire transfers totaling approximately $178.5 million between December 12, 2005, and March 31, 2006, involving Cuban persons in apparent violation of the CACR. In November 2005, another U.S. financial institution alerted JPMC that JPMC might be processing wire transfers involving a Cuban national through one of its correspondent accounts. After such notification, JPMC conducted an investigation into the wire transfers it had processed through the correspondent account. The results of this investigation were reported to JPMC management and supervisory personnel, confirming that transfers of funds in which Cuba or a Cuban national had an interest were being made through the correspondent account at JPMC. Nevertheless, the bank failed to take adequate steps to prevent further transfers. JPMC did not voluntarily self-disclose these apparent violations of the CACR to OFAC. As a result of these apparent violations, considerable economic benefit was conferred to sanctioned persons. The base penalty for this set of apparent violations was $111,215,000.

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