Violating U.S. economic sanctions can also violate disclosure duties under federal securities laws and therefore whistleblowing about sanctions evasion can qualify not only under the Anti Money Laudering Act but also under the Security and exchange Whistleblower Program .
Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012 requires SEC-registered issuers to disclose all Iran-related activities covered by sanctions restrictions. The SEC’s Office of Global Security Risk (OSGC) monitors issuers’ disclosures related to business activities involving US-sanctioned counties.
Penalties penalties for sanctions violations have been substantial. In 2017, Zhongxing Telecommunications Equipment Corporation paid $100,871,266 in a settlement for 251violations of the Iranian Transactions and Sanctions Regulations. ZTE used third-party companies to surreptitiously supply Iran with a substantial volume of U.S.-origin goods, including controlled goods appearing on the Commerce Control List.
Under the Anti-Money Laundering Act (AMLA) whistleblower reward program, the Treasury pays an award of between 10% and 30% of collected proceeds for whistleblower disclosures that lead to enforcement actions with sanctions in excess of $1 million for violations of the Bank secrecy Act (BSA) (money laundering) or for sanctions violations under: The International Emergency Economic Powers Act
(50 U.S.C. §§ 1701 to 1708); Sections 5 and 12 of the Trading With the Enemy Act
(50 U.S.C. §§ 4305 and 4312);BSA violations to the Financial Crimes Enforcement Network (FinCEN), a Treasury bureau;Sanctions violations to the Office of Foreign Assets
Control (OFAC), a Treasury agency that administers
enforces economic and trade sanctions and other laws.
JEFFREY NEWMAN IS THE SENIOR PARTNER OF JEFF NEWMAN LAW WHICH HANDLES SANCTION VIOLATION WHISTLEBLOWER CASES. FOR MORE INFORMATION CONTACT JEFF@JEFFNEWMANLAW.COM OR CALL 617-823 3217
