This article in Bloomberg Business Week details efforts by the U.K. Export Control Organization (“ECO”) to prevent U.K. companies that trade with Iran from becoming subject to U.S sanctions on Iran. Bloomberg filed a lawsuit in the United Kingdom seeking to force the ECO to reveal the names of companies that had applied for licenses to export controlled items to Iran. The United Kingdom observes UN sanctions, which prohibit exports of arms and materiel to Iran, but does not prohibit exports of controlled dual use items as long as licenses are obtained. In a court filing in that case, the ECO argued against releasing the information, saying that U.S. sanctions had caused banks to withdraw banking facilities from companies doing business with Iran.

Early versions of the Bloomberg story contained an interesting statement from a source at OFAC who wished to remain anonymous.

U.S. trade-secrets laws prevent the Treasury from disclosing the names of companies seeking licenses to export goods that would otherwise be prohibited by sanctions, according to a U.S. Treasury spokeswoman, who declined to be identified and said she couldn’t comment on the U.K. case.

That, of course, is simply not even close to being true, which may be why the spokeswoman wanted her name withheld. The spokeswoman seems to have forgotten somehow the release by OFAC to the New York Times of hundreds of names of corporations that received licenses to export items to Iran and other sanctioned countries. This blog reported on that release here. When I brought this to the attention of Erik Larsen, the reporter who wrote the story, the OFAC quotation was removed and a statement from me on the New York Times disclosures was substituted in its place.

The moral of the story: don’t believe everything that OFAC tells you during a phone conversation.

[Thanks to reader Russ VanDegrift, compliance director at Christie Digital Systems USA, Inc. for alerting me to the original Bloomberg story.]

Permalink