Dentsply Sirona agreed to a $1,220,400 settlement for 37 violations of the Iranian Transactions and Sanctions Regulation (ITSR). The statutory maximum penalty for these non-egregious, non self-disclosed violations was $9,551,082 and the base penalty was $1,695,500. Dentsply, between November 2009 and July 2012, shipped dental equipment and supplies to a third-country distributor with the knowledge or reason to know that the shipments would be sent to Iran.
Here’s how OFAC’s math worked:
OFAC considered the following to be aggravating factors:
- UKI and Sultan acted willfully by exporting U.S.-origin dental products to third-country distributors with knowledge or reason to know that the exports were ultimately destined for Iran in apparent violation of the ITSR. Personnel from these subsidiaries and/or divisions concealed the fact that the goods were destined for Iran, and in multiple cases continued to conduct business with these distributors after receiving confirmation that the distributors had re-exported DII products to Iran in apparent violation of the ITSR;
- Several supervisory and managerial personnel within UKI and Sultan had actual knowledge of, and actively participated in, the conduct that led to the apparent violations and appear to have deliberately concealed their awareness from DII; and
- DENTSPLY is a large and commercially sophisticated company with knowledge of U.S. sanctions and export control requirements.
OFAC considered the following to be mitigating factors:
- DENTSPLY has not received a penalty notice or Finding of Violation from OFAC in the five years preceding the date of the first transaction giving rise to the apparent violations, although DENTSPLY was previously the subject of a settlement involving substantially similar apparent violations in 2001;
- The harm to the ITSR program objectives was limited because the exports were likely eligible for a specific license;
- DENTSPLY took remedial steps, including voluntarily expanding the scope of the review to include a full, company-wide inquiry following a subpoena to one of its subsidiaries that led to the subsequent revelations involving the other subsidiary; and
- DENTSPLY cooperated with OFAC’s investigation, including by providing detailed and well-organized information for its review, and by agreeing to toll the statute of limitations for a total of 1,104 days.
Note that Dentsply tolled the statute of limitations for over 3 years.