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Industrial Bank of Korea Settles $1B Iran Sanctions Violations For $51M in SDNY

By Matthew Russell Lee, Patreon
BBC - Decrypt - LightRead - Honduras - Source

SDNY COURTHOUSE, April 20 – Amid the Covid-19 pandemic, many criminal cases in the U.S. District Court for the Southern District of New York are being put over. On April 20 the US Attorney for the SDNY announced a case again Industrial Bank of Korea and its New York branch - but a deferral for two years, in exchange for $51 million:

"IBKNY and IBK failed to promptly identify a series of transactions that violated the United States’ economic sanctions against Iran (the “Zong Transactions”):  From January 2011 until July 2011, Kenneth Zong,[1] an American citizen, and various primarily Iranian co-conspirators exploited bank accounts that had been established at IBK and at another bank to permit certain forms of trade between Korea-based entities and Iran (the “CBI Won Accounts”), to transfer U.S. Dollars (“USD”) unlawfully to Iranian-controlled entities.  In order to evade U.S. sanctions, Zong and his co-conspirators set up shell companies in Korea, Iran, and elsewhere, which engaged in sham trade transactions and submitted fictitious documentation to Korean banks, including IBK, in order to facilitate the transfer of Iranian funds from the CBI Won Accounts to Korean entities’ accounts, the conversion of the funds into USD, and the subsequent transfer of USD from those entities through U.S. financial institutions to other accounts controlled by Zong and his co-conspirators and/or for the benefit of Zong and his co-conspirators. 

   IBKNY did not review and identify the Zong Transactions as unlawful until more than five months after they began to be processed through IBK, after IBK had already processed more than $1 billion worth of such transactions." 

  $51 million fine for $1 billion of sanctions violations - is it a good deal? In this environment? Inner City Press will continue to cover this cases. This one is US v. Industrial Bank of Korea, no docket number provided, (UA).


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