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… and Alfa Laval’s lessons to be learned

Alfa Laval Middle East:

Non-U.S. companies should be aware of how their activities might trigger compliance issues with U.S. sanctions, including when they place orders with U.S. affiliates or subsidiaries. This is especially true for companies operating in multiple countries as part of a larger global business organization, and particularly those with connections to both the United States and sanctioned jurisdictions. Because maintaining such links can give rise to an increased risk of violating U.S. sanctions, foreign companies should also implement appropriate measures to mitigate their risks.
For example, global business organizations should ensure that subsidiaries and affiliates are trained on U.S. sanctions requirements, can effectively identify red flags, and are empowered to report prohibited conduct to management. By empowering employees to identify and report prohibited conduct, global business organizations may be able to prevent the formation of—and better detect— conspiracies intended to undermine U.S. sanctions. Conspiracies to violate U.S. sanctions laws are particularly harmful because multiple people in a transaction work in concert to undermine compliance controls, and as a result, economic sanctions. Empowering and educating the broader workforce on sanctions compliance may neutralize or mitigate these risks.

Alfa Laval Inc:

This case demonstrates the importance of implementing effective compliance training to ensure U.S persons know they are generally prohibited from referring business opportunities involving Iran, including to affiliated entities. Such referrals may also increase the likelihood of other, additional sanctions violations being committed. U.S. companies can mitigate such sanctions risks by establishing clear channels through which employees can report questionable activity and seek clarification when potential sanctions issues arise. U.S. persons should also heed warning signs that may indicate a sanctions nexus to a given business opportunity. When there are such warning signs present, additional compliance and due diligence checks should be implemented to make sure the foreign person or foreign company the U.S. person is dealing with is not located in a sanctioned country or working for or on behalf of persons in sanctioned jurisdictions or blocked persons.


Settlement Agreements: Alfa Laval Middle East Ltd, Alfa Laval Inc.

Categories: Enforcement Actions OFAC Updates Settlement Agreements


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