This post was written by Michael J. Lowell.
On the heels of the largest penalty settlement to date, OFAC has announced yet another settlement with a foreign bank relating to payments processed through U.S. financial institutions. On June 14, 2012, OFAC announced a settlement with the National Bank of Abu Dhabi (“NBAD”) for $855,000 to settle potential civil liability for 45 electronic funds transfers processed through U.S. financial institutions on behalf of its Sudan branch. According to OFAC, NBAD’s clerical staff removed or omitted Sudan-related references in payment instructions routed through U.S. banks for a total value of approximately $4.3 million.
Unlike the recent action against ING, OFAC considered the apparent violations to be “non-egregious.” OFAC’s finding likely relates to the relatively small value of the transactions and the lack of involvement of senior bank management. In the ING enforcement, OFAC alleged senior management awareness and a significant harm to U.S. sanctions programs objectives, while in the NBAD announcement, OFAC referred to the removal or omission of information by “clerical staff” and noted NBAD’s prompt and appropriate remedial action and its substantial cooperation. Most noteworthy is a consideration of these factors on the penalty assessed. In the ING enforcement, OFAC settled the matter for $619 million on a total base penalty amount of $665 million – ING paid approximately 93 percent of the base penalty. Alternatively, without the finding of egregious behavior and with substantial cooperation, NBAD paid less than 20 percent of the total base penalty.