UniCredit Bank OFAC Settlement Agreement

In April 2019, UniCredit Bank entered into a settlement agreement with the Department of Treasury Office of Foreign Assets Control (OFAC). OFAC investigated UniCredit’s transactions in violation of various U.S. sanctions regimes. UniCredit had not voluntarily self-disclosed these violations to OFAC prior to the initiation of the investigation.

UniCredit Sanctions Violations

UniCredit had processed transactions in violation of Iran, Sudan, Cuban, Myanmar, and Syria sanctions regimes. UniCredit also managed accounts for the Islamic Republic of the Iran Shipping Lines (IRISL), which has been accused of assisting Iran’s nuclear weapons program.

UniCredit was found to have purposely avoided mentioning IRISL in its wired instructions through U.S. financial institutions. UniCredit also engaged in transactions related to the exportation of Iranian oil, as well as the exportation of goods and services from Sudan, Cuba, Burma, Libya, and specially-designated global terrorists.

Terms of UniCredit Bank OFAC Settlement Agreement

As part of the settlement agreement with OFAC, UniCredit Bank agreed to cease the activities that were in apparent violation of U.S. sanctions and pay $553,380,758.68 to OFAC for the discharge of the violations. UniCredit also agreed to certain commitments, including:

Training their management, boards, and compliance officers
Creating a compliance unit;
Promoting a culture of compliance throughout the company
Periodically conducting OFAC risk assessments
Implementing certain internal controls
Preemptively avoiding violations
Maintaining adequate recordkeeping of transactions
Thoroughly auditing and testing internal controls
Certifying to OFAC that these terms have been implemented as set out in the settlement agreement

Impact of the Settlement

This was a significant settlement agreement, and it shows that OFAC has taken certain measures in these agreements to reinforce sanctions compliance in a way that is proactive and continuous in the future. With this investigation and subsequent settlement, OFAC showed that the U.S. government takes violations of its sanctions programs seriously.