Great Western will pay $1.35 million over Cuba trade sanctions

Great Western will pay $1.35 million over Cuba trade sanctions

Settlement is less than a quarter of 'base penalty' for violations
By Aaron Corvin
Columbian Staff Reporter
Tuesday, July 17, 2012

Great Western Malting Co. — the Vancouver-based maker and seller of beer
malt — has found out what happens when you breach rules that signify the
U.S. government's decades-long distaste for Cuba.

The company has agreed to pay $1.35 million to settle apparent
violations of federal trade sanctions against the island nation 90 miles
south of Key West, Fla., according to the agency of the U.S. Treasury
Department that enforces those sanctions.

Great Western, a tenant of the Port of Vancouver, could have been fined
nearly $6 million. That was the "base penalty amount" for what the
Office of Foreign Assets Control says is Great Western's violation --
handling the back-office functions for a foreign affiliate that sold
non-U.S. barley malt to Cuba.

The case was settled for $1.35 million because Great Western has no
prior sanctions violations, it "substantially cooperated" with
investigators, and the malt would have been eligible for a government
license if it had been shipped from the United States, the agency said
in its July 10 report.

Jay Hamacheck, Vancouver-based director of compliance and corporate
social responsibility for GrainCorp — the Sydney, Australia-based parent
of Great Western — declined to comment on the matter Tuesday.

Instead, he referred The Columbian to Angus Trigg, director of
government and media relations for GrainCorp in Sydney. In statements he
emailed to The Columbian, Trigg said Great Western and federal
authorities "have agreed to a confidential settlement" and that the
$1.35 million is "a settlement amount, not technically a fine."

The Office of Foreign Assets Control said a number of Great Western's
violations, which occurred between August 2006 and March 2009, involved
people in Cuba and a Cuban ship. In its report, the agency does not
identify the foreign affiliate of Great Western. It also does not
identify the people in Cuba — a country slightly smaller than
Pennsylvania -- or the vessel.

A spokesman for the agency, John Sullivan, declined to comment Tuesday,
saying in an email that "the company may be able to give you more details."

The U.S. government's action against Great Western came under the Cuban
Assets Control Regulations, which were issued July 8, 1963, under the
"Trading With the Enemy Act in response to certain hostile actions by
the Cuban Government," according to the U.S. Treasury Department.

Criminal penalties for violating the regulations range up to 10 years in
prison, $1 million in corporate fines and $250,000 in individual fines.
Civil penalties up to $65,000 per violation may also be imposed.

So far this year, the Office of Foreign Assets Control has levied
$622.98 million in penalties.

The largest came in June when the agency fined ING Bank in the
Netherlands $619 million for processing "20,452 wire transfers, trade
finance transactions, or travelers checks" involving Cuba.

Aaron Corvin: 360-735-4518; http://twitter.com/col_econ;
http://on.fb.me/AaronCorvin; aaron.corvin@columbian.com.

http://www.columbian.com/news/2012/jul/17/great-western-will-pay-cuba-trade-sanctions/