PRINT
Enforcement Release: September 3, 2025
Fracht FWO Inc. Settles with OFAC for $1,610,775 Related to Apparent Violations of Multiple Sanctions Programs
Fracht FWO Inc. (“Fracht”), an international freight forwarder with its principal place of business in Houston, Texas, has agreed to pay $1,610,775 to settle its potential civil liability for apparent violations of multiple OFAC sanctions programs, including those on Venezuela and Iran. In May 2022, Fracht, by failing to follow internal compliance procedures, contracted with a blocked Government of Venezuela airline to transport goods from Mexico to a customer in Argentina. To fulfill the contract, the blocked Venezuelan airline used an aircraft separately blocked by OFAC for being operated by Iran’s Mahan Air and crewed by Iranian nationals—conduct reflecting apparent violations of OFAC’s Iran, proliferation, and terrorism sanctions programs.
The settlement amount reflects OFAC’s finding that Fracht’s apparent violations were...
Click the appropriate link below for access to this file.
Click the appropriate link below for access to this file.
1) The VSR Violations
While certain aspects of the Fracht FWO case are notable, as described below, from a legal basis standpoint, the basic theory of liability does not break new legal ground. The U.S. person Fracht FWO received services from a blocked Venezuelan government entity and made payments to that entity, in both indirectly through a broker. Under these circumstances, there could be no question that the U.S. person was dealing in services in which the blocked person had an interest, and was making payments in which the blocked person had an interest. For another notable indirect dealing case, see Civil Enforcement Information - Eagle Shipping International (USA) LLC.
2) The GTSR and WMDPSR Violations and Significant for the Extinguishment...