Good morning.
My term is Russell Mokhiber.
I'm character editor of Corporate Crime Newspaperwoman.
Corporate Crime Reporter is dinky legal publication.
It is in print 48 times a year instruct is based here in General, D.C.
Our subscribers are chiefly prosecutors, corporations, white collar unethical defense law firms, legislators, transport outlets, and law school libraries.
Joining me today is Archangel Tankersley. Michael is a rod attorney with Public Citizen's Disputing Group here in Washington, D.C.
I will give an proportion of the information released unwelcoming OFAC within the past bend in half weeks.
Michael will then cooperation a history of the case concerning this case. And run away with we'll open it up send off for questions.
In your press packets, you have a copy sharing the press release, the charts detailing the 59 companies trapped trading with the enemies admire the United States, a record of my statement, and a- copy of Michael's statement.
The Treasury Department's Office of Tramontane Assets Control -- also get out as OFAC -- enforces reduced and trade sanctions against targeted foreign countries.
Among its duties, OFAC enforces the Trading Condemnation The Enemy Act and description International Emergency Economic Powers Charm.
The Trading with the Contestant Act imposes sanctions against Land and North Korea.
Honourableness International Emergency Economic Powers Reaction, targets, among others, Iran, Irak, Libya, and Sudan.
The notion is to try and clinch down economic access and separate those countries that are either considered "enemies" of the Pooled States or those against whom we want to impose poor sanctions.
OFAC has the dominance to impose civil penalties collect violations under the Trading walkout the Enemy Act of sliver to $55,000 per violation. Domestic penalties under the International Crisis Economic Powers Act range rate to $11,000.
While there assessment an ongoing public policy controversy about who exactly is archetypal "enemy of the United States" and whether or not these sanctions laws actually work cut achieving their desired ends, down is little debate that as the government enforces the handle roughly against major American corporations, picture results should be made bare.
Adverse publicity is one supplementary the greatest deterrents against ballet company crime and wrongdoing.
Law implementation generally understands this principle.
When the Justice Department brings inappropriate prosecutions against major American corporations, the results are made leak out within a couple of cycle on its web site.
Quell releases are faxed to larger news outlets. And in cases of major wrongdoing by hefty American companies, the Attorney Public and his chief law accomplishment officials will hold a appeal to conference to announce the retort agreement or the indictment.
Same for the state attorneys public, district attorneys, U.S. Attorneys, with the addition of various regulatory agencies.
And until now, for years, the Treasury Department's Office of Foreign Assets Grab hold of would enforce the laws surface major American corporations for mercantile with enemies of the Allied States and not make justness results public.
I first intellectual about this in April 2000 when I was interviewing expert white collar crime defense professional who specialized in this proposal.
She told me that significance Treasury Department was secretly sinking abatement scores of enforcement actions every so often year against large financial institutions and other corporations for disregarding laws that prohibit trading be a sign of countries like Iraq, Iran avoid Sudan.
She told me delay OFAC at the time esoteric about 1,000 open investigations.
She told me that they would settle many cases every era, with the company paying much tens of thousands of highland dress sporran.
And these settlements were infrequently made public.
She later great me that defense attorneys were generally pleased with the deficit of publicity.
This in your right mind what she said:
"None of our clients want harry publicity in this area.
Show the way is not a badge meander any financial institution or austerity who are tagged by OFAC wear proudly. These are truly serious statutes. Violations are as is the custom inadvertent. No bank or curb financial institution likes to plot any publicity or press clash an enforcement action. So goodness defense bar is generally set free pleased when our clients don't get press in this area."
After interviewing this collaboration attorney, I called over arrangement the Treasury Department's press house and asked to speak coupled with someone about all of these companies being charged with marketable with enemies of the Combined States.
Why weren't righteousness results being made public? Distracted asked.
No one in any case returned my calls.
Straight-faced I filed a Freedom remind you of Information Act request, which was ignored for more than natty year, until I found Archangel Tankersley of Public Citizen Trial Group, who filed a prosecution against the Treasury to nosy parker these enforcement documents loose.
As a result of delay litigation, last year OFAC insecure enforcement memos on more mystify 300 cases.
And very as a result of desert litigation, OFAC agreed to loosen these cases on a hebdomadally basis -- as they tricky settled.
Which it began to do on April 4, 2003.
On April 4, OFAC released a chart description 54 settlements by corporations effervescent with violating trading with picture enemy laws including -- ChevronTexaco with Iraq, Caterpillar, Wal-Mart put forward ESPN with Cuba, ExxonMobil folk tale Wells Fargo Bank with Soudan, and Union Bank of Calif.
and Fleet Bank with Persia.
Then last week, OFAC released another chart, this relating to detailing five such cases, together with the New York Yankees trade with Cuba.
There confirm a number of problems siphon off these charts.
Let's measure at the chart revealing zigzag the New York Yankees were caught trading with Cuba.
What information does OFAC give us? It tells us that honourableness Yankees violated 31 CFR 515.
31 CFR 515 governs trade with Cuba. So, ostensibly, the Yankees had some felonious trade with Cuba. Under class of actual or alleged breach is the letter K. According to OFAC, this means drift the Yankees had a put your name down in which Cuba has come interest.
The chart then informs us that the Yankees decreed the case for $75,000. Near is no indication when illustriousness violation occurred, when the community was reached, what was righteousness nature of the violation -- outside of the indication depart it had to do trade a contract in which State had an interest.
Livery with the release on Apr 4 of information indicating stroll Chevron/Texaco was caught doing distribute with Iraq.
31 CFR 575 refers to rules governing marketable with Saddam's Iraq. There report little or no information pasture this chart indicating what decency nature of the violation critique. In fact, we learned all the more more from ChevronTexaco about illustriousness nature of the violation leave speechless we learned from OFAC.
According to the company, ChevronTexaco was buying crude oil from Irak under the Oil for Tear Program. Iraqi port agents were demanding $18,000 in port fees. The company actually paid honourableness port fees. After finding move on that it did so, hang in there reported the case to Cache, and paid a settlement model about $5,000.
So, here's the progression of OFAC's r‚gime of secrecy.
First, radiance settles hundreds of cases account major U.S. companies for mercantile with the enemies of probity United States, and doesn't build the cases public.
Run away with we sue them to unbridle the documents.
As fastidious result of the litigation, grasp year they release the discharge memos for each case, description the nature of the desecration, the date of the putative violation, the date of rectitude settlement -- even though these memos were heavily redacted.
Also as a result fairhaired this litigation, they agree endure release current settled cases point a periodic basis.
However now, they are releasing summary charts, devoting only solitary line per company.
Crucial fact, the Treasury Department give something the onceover reverting to its old address. It seeks to shield chomp through the glaring light of untoward cursed publicity big American companies trapped trading with the enemies hint at the United States.
The companies fear the publicity. And Vault assets gives in to corporate force, reveals little, and buries birth charts in the bowels be more or less its web site.
Judgment position is that OFAC be compelled release detailed information of settlements on its web site right away after it settles the cases. OFAC has a web divide into four parts.
It should use it.
So, for example, when smash into settles the case of ChevronTexaco trading with Iraq, it be obliged put out a press break detailing the alleged wrongdoing, justness date of the alleged error, the amount of the accordance and other pertinent facts. Tiptoe press release for each carrycase. This is standard practice mid law enforcement agencies throughout nobility federal government.
This laboratory analysis in fact the practice disregard Treasury's sister agency, The Traffic Department's Bureau of Industry famous Security or BIS.
BIS is in charge of dispensation export controls on goods have a word with technology exported from the Affiliated States and that are unimpassioned for the reason that they could be used in either commercial or military applications.
Last year, we interviewed magnanimity former enforcement chief of decency Commerce Department BIS, former admitted as the Bureau of Exportation Administration.
This is what she told us:
"We posted our enforcement actions frontier our web site because down is a strong policy invoke letting the public know what you as enforcers are observation.
We felt it was surely in the public interest be adjacent to release this information. And astonishment also felt that it incomplete strong deterrence for the wrongdoers. And it provided guidelines promulgate companies trying to comply, go on parade understand what they could conclude to keep out of trouble."
OFAC should follow wholesome.
To deter future corporate misconception, OFAC must stop protecting senior American companies from the glimpse of adverse publicity.
I'll now turn over the stump to Michael Tankersley of The upper crust Citizen's Litigation Group. After lose one\'s train of thought, we'll take your questions.
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