Iran (General) U.S. firm fined $6.3 million for Iran trade

U.S. firm fined $6.3 million for Iran trade

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Washington Times: Federal prosecutors completed a plea agreement this week that imposed more than $6.3 million in fines on a U.S. company that illegally sent embargoed high-technology pumps to Iran.
“We view this case as very significant,” said Julie Myers, assistant commerce secretary for export enforcement … Washington Times

By Bill Gertz

Federal prosecutors completed a plea agreement this week that imposed more than $6.3 million in fines on a U.S. company that illegally sent embargoed high-technology pumps to Iran.

“We view this case as very significant,” said Julie Myers, assistant commerce secretary for export enforcement, who took part in the year-long investigation of Ebara International Corp.

“It shows we have a strong commitment to enforcing the embargo against Iran, and that people who ship to embargoed destinations will be found out, and we will go after them to the full extent of the law,” she said in an interview.

The plea deal was approved by U.S. District Court Judge John Garrett Penn in federal court Thursday. The case involved the specialty pump manufacture Ebara, a Sparks, Nev.-based subsidiary of a Japanese company, Ebara Corp. Japan.

The company was fined $6.3 million related to seven counts of conspiracy, money laundering and illegal exports. It also was fined an additional $121,000 in civil penalties.

The fine is one of the largest penalties for an illegal-export case ever imposed, officials said.

Kenneth L. Wainstein, U.S. Attorney for the District, said, “Export controls and embargoes should not be seen as avoidable obstacles to increase corporate profits, but as a corporation’s opportunity to contribute to this nation’s security.

“Those responsible for violations of the United States’ export laws will be held accountable,” he said.

Ebara’s former chairman, Everett Hylton, also pleaded guilty to conspiracy to make false statements. He will receive a three-year suspended prison term and a $99,000 fine for his role in the case.

The investigation was triggered in August 2003 after inquiries about the diversion were first made to the Commerce Department by a reporter for The Washington Times.

The company was caught in a scheme to sell cryogenic submersible pumps to Iran. The company conspired with two French companies, Cryostar and Technip, to mask the deal by making it appear the pumps were being sold to a French firm.

The pumps were banned for export to Iran under U.S. anti-terrorism sanctions. Iran has been designated a state sponsor of terrorism, thus trade to the country is severely restricted.

Four pumps were sold and the covert transfer of three others was blocked during the investigation by the Commerce Department’s Bureau of Industry and Security.

Miss Myers declined to comment on the role of Cryostar and Technip, noting that the investigation of the illegal pump sale is continuing. She said that there were initial fears that the cryogenic pumps, which can transport cold liquids, may have been for Iran’s nuclear program.

However, she said that it is now believed by government officials that the pumps were limited to use in pumping liquid natural gas.

The pump sale originated in 2001 when one of the French companies sought to buy pumps from Ebara, despite U.S. trade restrictions on Iran.

The Japanese parent firm, Ebara Corp. Japan, initially opposed the sale, but later went along with a scheme to complete the deal illegally by circumventing the U.S. embargo.

Ebara in early 2003 falsified export documents in an attempt to hide the transaction from investigators.

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