Enforcement Release: September 27, 2021
OFAC Settles with Schlumberger Rod Lift, Inc. for Its Potential Civil Liability for an Apparent Violation of the Sudanese Sanctions Regulations
Schlumberger Rod Lift, Inc. (“SRL”) (now d/b/a Lufkin Rod Lift, Inc.[1]) — a Frisco, Texas-based company that was formerly a subsidiary of Schlumberger Lift Solutions LLC (“SLS”), itself a U.S. subsidiary of Schlumberger Limited (“Schlumberger”) of Curaçao, Netherlands — has agreed to pay $160,000 to settle its potential civil liability for an apparent violation involving its facilitation of one shipment of goods from a Schlumberger subsidiary in Canada, to a Schlumberger joint venture in China, for ultimate delivery to Sudan. The settlement amount reflects OFAC’s determinations that SRL’s conduct was non-egregious and was not voluntarily self-disclosed, and further reflects OFAC’s consideration of aggravating and mitigating factors.
[1] On November 2, 2020, Lufkin Industries announced that it had completed the...
1) Basis for Liability
Section 538.206 of the SSR, as it was then in force, provided that the facilitation by a United States person…of the exportation or reexportation of goods, technology, or services from Sudan to any destination, or to Sudan from any location, is prohibited.” The activities at issue, i.e. “assist[ing] in the management of customer requirements and help[ing] arrange for the shipment of the goods” to a prohibited destination is textbook “facilitation” (if done by a person subject to sanctions regulations).
Here, Schlumberger’s Canadian subsidiary was not a U.S. person (nor was the Chinese JV). However, SLS was a U.S. person, as were the employees of SLS that facilitated the Sudan-related transaction.
2) “Management Involvement”
OFAC goes out of its way to highlight that Schlumberger, at the...