Export compliance costs and awareness will likely rise for aircraft transactions due to increased compliance by aircraft sellers following the seizure of 12 aircraft on export violation charges, Vedder Price's David Hernandez said. In an April 5 report, Hernandez looked at the impacts of the indictments of eight individuals charged with drug trafficking and export violation conspiracies, including the owner of Aircraft Guaranty Corporation (see 2103010028). The indictments arose from a series of investigations into the customs export practices of U.S.-based trust companies serving as trustees in aircraft ownership trusts with non-U.S. citizens, called Non-Citizen Trusts.
The president of a Long Island, New York-based cosmetics company, Michael Rose, was arrested for allegedly selling more than $350,000 in cosmetic goods to an Iranian importer in violation of U.S. sanctions on the Middle Eastern nation, the U.S. Attorney's Office for the Southern District of New York announced in an April 6 news release. Between 2015 and 2018, Rose, of Ridgefield, Connecticut, allegedly exported the goods to an Iranian importer to fulfill a contract the two parties signed, making the importer the sole distributor of Rose's cosmetics in Iran. The goods skirted U.S. sanctions via front companies that had Rose sending his cosmetics to the United Arab Emirates. Rose also allegedly filed false and misleading information on Commerce Department Shipper's Export Declaration forms, declaring that the “ultimate consignee” for the goods was the UAE and not Iran.
Judge Mark Barnett has taken over as the chief judge of the U.S. Court of International Trade, following Judge Timothy Stanceu's assumption of senior status April 5 (see 2103160061), according to the court's website. Barnett joined the court in 2013 as a President Barack Obama appointee. He previously practiced in the international trade group at Steptoe & Johnson and served in the Office of Chief Counsel for Import Administration at the Commerce Department. He was the longest tenured judge at CIT at the time of Stanceu's move to senior status.
Venezuela was denied a stay of a more than $234 million arbitration award payment to Luxembourg-based steel pipe and tube supplier Tenaris S.A. since the stay would be redundant due to current restrictions on the payment, a judge for the U.S. District Court for the District of Columbia ruled in a March 29 decision. Due to current Office of Foreign Assets Control sanctions on Venezuela, enforcement of the award cannot be completed until Tenaris receives a license from OFAC or until U.S. sanctions on Venezuela are lifted entirely. Judge Carl Nichols found that with the OFAC restrictions, Venezuela is not required to pay until Tenaris receives the agency's permission, so a stay “does nothing to alter the status quo.” The arbitration payment was awarded to Tenaris by the International Centre for Settlement of Investment Disputes for Venezuela's expropriation of Tenaris assets without compensation.
Russian national Oleg Vladislavovich Nikitin, general director of St. Petersburg, Russia-based energy company KS Engineering, pleaded guilty in the U.S. District Court for the Southern District of Georgia to conspiracy to skirt export controls, the U.S. Attorney's Office for the Southern District of Georgia announced in a press release. Nikitin, admitted to attempting to sell a power turbine to a Russian company attempting to use it on an Arctic deepwater drilling platform -- a process banned by the Commerce Department without a license. An unnamed Russian government-controlled business contracted with Nikitin to buy the turbine from a U.S. manufacturer for $17.3 million. Nikitin, along with two others, was arrested in Savannah, Georgia, attempting to carry out the transaction for the turbine.
The Bureau of Industry and Security revoked export privileges for five people after they were convicted of violating various export control laws, including illegal shipments of guns, ammunition and other military items, BIS said in March 25 orders.
Ten Iranian nationals are charged with running a 20-year scheme to evade U.S. sanctions on Iran by disguising more than $300 million worth of transactions, the Department of Justice said in a March 19 news release. The Iranian citizens allegedly made the purchases, including two $25 million oil tankers, on Iran's behalf via front companies in Los Angeles, Canada, Hong Kong and the United Arab Emirates, DOJ said. The U.S. District Court of Los Angeles case, filed in October 2020, was unsealed on March 19. A separate forfeiture complaint was filed the same day on the same individuals, seeking a money laundering penalty of $157,332,367. The individuals are accused of violating the Iranian Transactions and Sanctions Regulations, Iranian Financial Sanctions Regulations and the International Emergency Economic Powers Act. They face a maximum of 20 years in federal prison if convicted, although they are believed to be located outside the U.S.
Dual U.S.-Mexican citizen Jessica Johanna Oseguera Gonzalez pleaded guilty on March 12 to engaging in financial dealings with Mexican companies that had been identified as Specially Designated Narcotics Traffickers, the Department of Justice announced in a press release. Oseguera Gonzalez, the daughter of Cartel Jalisco Nueva Generacion head Nemesio Ruben Oseguera Cervantes, aka “El Mencho,” faces a maximum of up to 30 years in prison and is set to face sentencing on June 11. She pleaded guilty to violating the Foreign Narcotics Kingpin Designation Act by engaging in property transactions with six Mexican businesses that had been designated by the Treasury Department's Office of Foreign Assets Control.
Florida resident Victor Mones Coro was sentenced to 55 months in prison for violating U.S. sanctions on Venezuela by chartering private flights for top Venezuelan officials, the Department of Justice said March 17. Sentenced in the U.S. District Court for the Southern District of New York, Mones Coro provided millions of dollars in charter flight services to former Venezuelan Vice President Tareck El Aissami, his frontman Samark Lopez Bello, Venezuelan Supreme Court President Maikel Moreno and President Nicolas Maduro's 2018 campaign for president. The chartered flights violate the Treasury Department's Office of Foreign Assets Control sanctions on the Venezuelan officials for their role in subverting democracy and proliferating authoritarianism. Mones Coro also will pay a $250,000 fine and serve two years of supervised release.
The Bureau of Industry and Security fined a California-based satellite communications company $122,000 for illegally exporting controlled goods to Russia, the United Arab Emirates and Brazil. BIS said the company, Comtech Xicom Technology, exported more than $150,000 worth of “traveling wave tubes” (TWT) without licenses, a March 18 order said.