ENFORCEMENT INFORMATION FOR April 7, 2011
Metropolitan Life Insurance Company Settles Cuban Assets Control Regulations Allegations: Metropolitan Life Insurance Company, New York, NY ("MetLife") has remitted $22,500 to settle allegations of a violation of the Cuban Assets Control Regulations, 31 C.F.R. part 515, which were promulgated pursuant to the Trading With The Enemy Act, 50 U.S.C. App. 1-44, and are administered by the Office of Foreign Assets Control ("OFAC").
OFAC alleged that, in June 2006, MetLife mailed a check representing a $30,162 lump sum death benefit payment directly to the beneficiary in Cuba. This matter was not voluntarily disclosed by MetLife. The alleged violation was reported to OFAC and to MetLife by the attorney who administered the estate of the U.S. decedent. Upon the receipt of the notice, MetLife stopped payment and deposited the death benefit payment into a blocked account. The funds were subsequently transferred to a bank for distribution to the beneficiary. The alleged violations constituted a non-egregious case.
The base penalty amount for MetLife’s apparent violation was $50,000, the Applicable Schedule Amount established by the OFAC Economic Sanctions Enforcement Guidelines applicable to the apparent violation. The settlement amount reflects OFAC’s consideration of the following:
MetLife provides specialized insurance services; MetLife has not been the subject of prior OFAC penalties; MetLife cooperated with OFAC by making an authorized transfer of the blocked payment to a blocked account opened in the name of the beneficiary for the purpose of making authorized distributions to the beneficiary; and MetLife has taken several steps to strengthen its OFAC compliance program, including requiring sanctions compliance training of all employees.
1) The mailing of the check was contrary to the then-existing protocol for the administration of decedents' estates. In 2006, "[a]ny payment or distribution of any funds, securities or other choses in action to a designated national shall be made by deposit in a blocked account in a domestic bank or with a public officer, agency, or instrumentality designated by a court having jurisdiction of the estate." (515.523 (2006)).
2) The current 515.523 is far more liberal.
§515.523 Transactions incident to the administration of decedents' estates.
All transactions incident to the administration and distribution of the assets of a blocked estate of a decedent are authorized. Such transactions include the appointment and qualification of a personal representative in the United States or Cuba, collection and preservation of assets by a personal representative and associated fees, payment of funeral expenses and expenses of the last illness, transfer of title, and distribution of assets pursuant to a valid testamentary disposition or intestate succession. All property distributed pursuant to this section is unblocked, provided that neither Cuba nor a Cuban national (other than the decedent or a person unblocked pursuant to §515.505) has an interest in the property.
Note to §515.523: See §515.570(f)(1) for a general license authorizing funds deposited in a blocked bank account in a banking institution, as defined in §515.314, as a result of certain administration of decedents' estates to be remitted to a national of Cuba.
[80 FR 56920, Sept. 21, 2015]