OFAC 09 JULY 2020 Amazon settles with OFAC for sanctions screening failings

Amazon has agreed to pay just short of $135,000 to settle potential civil liability for apparent violations of sanctions programmes administered by the US Treasury’s Office of Foreign Assets Control (‘OFAC’).

In a statement, OFAC said: ‘As a result of deficiencies related to Amazon’s sanctions screening processes, Amazon provided goods and services to persons sanctioned by OFAC; to persons located in the sanctioned region or countries of Crimea, Iran, and Syria; and to individuals located in or employed by the foreign missions of countries sanctioned by OFAC.

‘Amazon also failed to timely report several hundred transactions conducted pursuant to a general license issued by OFAC that included a mandatory reporting requirement, thereby nullifying that authorization with respect to those transactions.’

According to OFAC, ‘[P]ersons  in Crimea, Iran, and Syria placed orders or otherwise conducted business on Amazon’s websites for consumer and retail goods and services where the transaction details demonstrated that the goods or services would be provided to persons in Crimea, Iran, or Syria. Amazon also accepted and processed orders on its websites for persons located in or employed by the foreign missions of Cuba, Iran, North Korea, Sudan, and Syria,’ and that it had also accepted and processed orders from persons on its List of Specially Designated Nationals and Blocked Persons (the ‘SDN List’).

The violations occurred, it said, because the company’s automated sanctions screening processes ‘failed to fully analyze all transaction and customer data relevant to compliance with OFAC’s sanctions regulations.’

OFAC said: ‘In some instances, orders specifically referenced a sanctioned jurisdiction, a city within a sanctioned jurisdiction, or a common alternative spelling of a sanctioned jurisdiction, yet Amazon’s screening processes did not flag the transactions for review.

‘For example, Amazon’s screening processes did not flag orders with address fields containing an address in “Yalta, Krimea” for the term “Yalta,” a city in Crimea, nor for the variation of the spelling of Crimea. In another example, Amazon failed to interdict or otherwise flag orders shipped to the Embassy of Iran located in third countries. Moreover, in several hundred instances, Amazon’s automated sanctions screening processes failed to flag the correctly spelled names and addresses of persons on OFAC’s SDN List.’

See: https://www.treasury.gov/resource-center/sanctions/CivPen/Documents/20200708_amazon.pdf

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