Clinton: Ofers "should have known" they were dealing with Iran

Israel's Ofer Brothers Group and others "should have known" they were providing sanctionable goods or services to Iran, according to the U.S. Department of State.

Secretary of State Hillary Rodham Clinton last week imposed the first sanctions for refined-petroleum related activities under the Iran Sanctions Act (ISA) of 1996, as amended by the Comprehensive Iran Sanctions, Accountability, and Divestment Act (CISADA) of 2010.

These companies are PCCI (Jersey/Iran), Royal Oyster Group (UAE), Speedy Ship (UAE/Iran), Tanker Pacific (Singapore), Ofer Brothers Group (Israel), Associated Shipbroking (Monaco), and Petroleos de Venezuela (PDVSA) (Venezuela).

A State Department backgrounder says that Tanker Pacific (Singapore), Ofer Brothers Group (Israel), and Associated Shipbroking (Monaco) are being sanctioned for their respective roles in a September 2010 transaction that provided a tanker valued at $8.65 million to the Islamic Republic of Iran Shipping Lines (IRISL), an entity that has been designated by the United States, and the European Union for its role in supporting Iran's proliferation activities.

"We believe that Tanker Pacific and Ofer Brothers Group failed to exercise due diligence and did not heed publicly available and easily obtainable information that would have indicated that they were dealing with IRISL. The Secretary will hold companies accountable, as required by the ISA, when they know or 'should have known' they were providing sanctionable goods or services to Iran," says the State. Department. With imposition of  sanctions, Tanker Pacific and Ofer Brothers Group are barred from securing financing from the Export-Import Bank of the United States, from obtaining loans over $10 million from U.S. financial institutions, and from receiving U.S. export licenses. Associated Shipbroking knowingly acted on behalf of an IRISL front company. Accordingly, with the imposition of the sanctions, Associated Shipbroking is now prohibited from U.S. foreign exchange transactions, U.S. banking transactions and all U.S. property transactions.

Petrochemical Commercial Company International aka PCCI (Jersey); Royal Oyster Group (UAE); and Speedy Ship aka Sepahan Oil Company or SPD (UAE/Iran) firms are among the largest current suppliers of refined petroleum products to Iran and all three, says the State Department, regularly engaged in deceptive practices in order to ship these products to Iran and evade U.S. sanctions. The sanctions imposed on these firms will prohibit them from U.S. foreign exchange transactions, U.S. banking transactions, and all U.S. property transactions.

Petroleos de Venezuela (PDVSA) has delivered at least two cargoes of reformate to Iran between December 2010 and March 2011, worth approximately $50 million. Reformate is a blending component that improves the quality of gasoline. The sanctions imposed on PDVSA prohibit the company from competing for U.S. government procurement contracts, from securing financing from the Export-Import Bank of the United States, and from obtaining U.S. export licenses. These sanctions do not apply to PDVSA subsidiaries and do not prohibit the export of crude oil to the United States.

May 30, 2011