Company fined $5.9 million for travel to Cuba

Posted on Saturday, 04.19.14

Company fined $5.9 million for travel to Cuba
BY JUAN O. TAMAYO
JTAMAYO@ELNUEVOHERALD.COM

A major Netherlands company that handled the travel of 44,430 people to
and from Cuba will pay $5.9 million to the U.S. government to settle a
complaint that it violated the trade embargo on the island, the U.S.
Treasury Department has announced.

Treasury's announcement said CWT B.V. had continued to do business in
Cuba after it became majority-owned by U.S. entities in 2006, and
therefore was subject to the U.S. Trading With the Enemy Act.

The fine appeared to be one of the largest assessed on a travel agency
for Cuba embargo violations, although several foreign banks have had to
pay hundreds of millions of dollars to settle alleged violations.

CWT B.V. was part of the Netherlands-based Carlson Wagonlit Travel, a
global leader in travel. CWT specializes in business travel, operates in
more than 150 countries and reported $21.4 billion in total sales volume
in 2009, according to its website.

Treasury did not identify CWT's U.S. buyers in 2006. One Equity Partners
II, L.P., a subsidiary of JPMorgan Chase, and JPMorgan's Chase Travel
Investment, were listed in business reports as holding some ownership
interests in CWT in 2010.

U.S.-owned companies doing business in Cuba or with Cuban entities are
required to have special licenses issued by Treasury's Office of Foreign
Assets Control (OFAC), which enforces U.S. sanctions on all foreign
countries.

CWT's possible violations took place from Aug. 8, 2006 to on or about
Nov. 28, 2012, "dealt in property in which Cuba or its nationals had an
interest" and involved trips by 44,430 people, Treasury said in a
statement Friday.

OFAC said the base penalty for the case was $11,093,500, but that was
cut to $5.9 million because CWT voluntarily reported the apparent
violations, halted them, cooperated with U.S. investigators and took
"significant remedial action."

CWT is a "commercially sophisticated international corporation and
travel services," the Treasury statement noted, "but failed to exercise
a minimal degree of caution or care regarding its obligations to comply
with OFAC sanctions against Cuba."

The large number of Cuba travelers it handled "caused significant harm
to the objectives" of the U.S. sanctions on the communist-ruled island
under the Cuban Assets Control Regulations (CACR).

JPMorgan Chase Bank agreed to pay $88.3 million in 2011 to settle
allegations of "egregious" CACR violations by processing 1,711 wire
transfers totaling $178.5 million from Dec. 12 of 2005, and March 31 of
2006 involving Cuba or Cuban nationals.

JPMC investigated a tip from another institution that it could be
violating the regulations, confirmed it and yet "failed to take adequate
steps to prevent further transfers" and did not voluntarily report the
apparent violations, Treasury said at the time.

ING bank in the Netherlands paid $619 million in 2011 to settle
allegations of illegal dealing with Cuba, Iran, and other sanctioned
countries. Credit Suisse Bank paid $536 million in 2009 and the
Swiss-based UBS paid $100 million in 2004 for similar cases.

Source: Company fined $5.9 million for travel to Cuba - Breaking News -
MiamiHerald.com -
http://www.miamiherald.com/2014/04/19/4068790/company-fined-59-million-for-travel.html