The U.S. Office of Foreign Assets Control (“OFAC”) and Bureau of Industry & Security (“BIS”) announced today that it has reached a settlement with ING Bank N.V. (“ING”) relating to potential liability under various U.S. sanctions against Burma (Myanmar), Cuba, Iran, Libya, and Sudan. The apparent violations date back to conduct that begin in 1994 and concern an allegedly willful plan by ING to covertly process fund transfers that benefited U.S. sanctioned countries through the U.S. financial system.
The settlement agreement outlines the allegedly deceptive behavior undertaken by ING. This conduct included payment processing manuals instructing employees to give special attention to Cuban references, which was followed by verbal instructions from ING senior management to avoid Cuba references in payment instructions. Additionally, ING allegedly provided misleading information on SWIFT payment instructions so as to avoid OFAC detection.
In addition to finding conduct intended to avoid OFAC detection, OFAC determined:
- From 2002 through 2007, ING processed payments through financial institutions in the United States, in violation of the Cuban Sanctions, with an aggregate value of approximately US$1.655 billion
- From 2003 through 2007, ING processed electronic funds transfers, in violation of the Burmese Sanctions, through the United States in the aggregate amount of approximately US$15 million
- From 2004 through 2006, ING processed electronic transfers through the United States in violation of the Sudanese Sanctions, in the aggregate amount of approximately US$2 million
- In 2004, ING processed approximately US$26,000 in transactions through the United States in violation of the Libyan Sanction
- In 2004, ING processed letters of credit that benefited Iranian entities in violation of the Iran Transaction Regulations
In determining its penalty, OFAC noted that ING promptly undertook action to remediate its violations by conducting a global review of its practices. ING adopted a consolidated sanctioned countries policy for all ING business units, disengaged in any new business in sanctioned countries, and closed its office in Havana.
This penalty is the latest in a string of enforcement actions against European banks that have been brought by OFAC working in conjunction with the Department of Justice and the New York Country District Attorney’s Office. A discussion of the prior enforcement actions may be found here.
