OFAC Enforcement - Zoltek Companies, Inc.

Ed. Note: if you’re new to TURBOFAC, please take note that the text string filtration function generally shouldn’t be used for terms such as “ordinarily resident,” “causing” or “new debt”. For research on the meaning of words and phrases such as those, i.e. terms central to the key legal issues in sanctions law that appear on a cross-programmatic basis, you’re typically better off locating and checking the appropriate box in the “Key Legal Issues” search category, which will limit the results to those that have been manually assessed as being relevant for the interpretation of the terms at issue.

Try typing your search term (“ordinarily resident,” “new debt,” or something else) in the “Find a Search Filter” box at the top of the page, and the corresponding “Key Legal Issues” check box will pop up instantly, if one exists. Once you check the box (e.g. “new debt,” with ~55 results), you can always use the text string filtration function to further refine your search (e.g. by typing “invoice” and narrowing the ~55 results to ~10).

Note in addition that the same applies to text string searches such as “14071” (if you’re looking for items related to EO 14071). By typing “14071” in the “Find a Search Filter” field up top, you will be able to instantly narrow the results down to items manually assessed as relating to EO 14071. Ditto terms such as “515.204” or “Iran General License G” (try the “Discrete Legal Provision” search category). Please contact [email protected] or [email protected] with any questions on search results and efficiency.

Please click "Apply Text String Filters" again after clicking the "Close" button immediately below.

TURBOFAC Commentary (462 words)

Notes:

1) Further factual information is provided in Settlement Agreement (OFAC) - Zoltek Companies, Inc. (2019).

2) OFAC notes in the Settlement Agreement that the Hungarian local counsel concluded that the sanctions at issue did not apply to entities in Hungary. OFAC does not mention that this is actually true. On the basis of the facts given, if the Hungarian entity made the purchases at issue without involving the U.S. parent or U.S. financial system, neither 548.201 nor any other provision of the Belarus Sanctions Regulations would have been violated.

3) This appears to be the first and only pure "facilitation" case in connection with a list-based sanctions program. John Bean Technologies Corporation (2015) is close, factually, but that case involved a U.S. person dealing in a letter of credit in the U.S. in which a blocked person had an interest.
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Civil Enforcement Information - Zoltek Companies, Inc.

TURBOFAC Commentary (462 words)