Posts Tagged ‘Obama’

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Five Democrats and their Middle East donors

April 8, 2014
Bill Clinton and Sheikh Mohammed Al-Amoudi

Bill Clinton and Sheikh Mohammed Al-Amoudi

Opponents of George W. Bush like pointing out his family’s links to Saudi Arabia. Fair enough, but let’s not lose sight of the high-profile Democrats who have benefited from multi-million dollar campaign contributions, sweetheart loans, and business deals from Wahhabi or Iranian patrons, or both:

Jimmy Carter—Carter accepted $1 million from the Bin Laden family for his Carter Center presidential library. Carter also received a multi-million dollar loan in the late 1970s to save his peanut business—a loan which was backstopped by BCCI, the Pakistani-operated, Persian Gulf-funded bank that became embroiled in international corruption scandals and was ultimately shut down. BCCI officials had relationships with Osama Bin Laden, gave nuclear secrets to Pakistan, and served as the depository for money made off the Arab oil embargo. Bert Lance, a Carter administration official and close personal friend of Carter’s, was forced to resign during Carter’s presidency for improper banking relationships with BCCI. More recently, Carter refused to give back a donation from the Zayed Foundation, an anti-Semitic, anti-Israeli, Saudi group, even after Harvard University had refused to accept a donation from the same foundation. Several observers have concluded that the funding has influenced Carter’s increasingly harsh views and references to apartheid when describing Israel.

(As a footnote, Jimmy Carter’s grandson, who is currently running for governor of Georgia, was accused of accepting too much foreign money when he first ran for office as a state senator in 2010, and Mohammad Bhuiyan, a university professor who is friend and ally of international micro-credit loan shark and alleged tax cheat Mohammad Yunus, has donated to Jason Carter’s political campaigns.)

Bill Clinton—The Clinton Foundation accepted a gift of at least $1 to $5 million if not $20 million from billionaire oilman Sheikh Mohammed H. Al-Amoudi. Saudi Arabia itself gave between $10 and $25 million shortly before his wife became secretary of state, with Kuwait, Qatar and Oman each giving between $1 to $5 million. These donations followed earlier millions that flowed from the Saudi royal family to the Clinton library in Arkansas. In her dealings with the Islamic world as secretary of state, Hillary Clinton neglected to pursue an agreement with Iraq to provide for its ongoing security needs after the withdrawal of American troops, and she pressed for negotiations with the Taliban in Afghanistan—two decisions which coincidentally aligned with the desires of Saudi Arabia.

Al Gore—Gore personally made about $100 million from his share of the sale of the Current TV network to the Qatari-controlled sensationalist and anti-Semitic network Al Jazeera. The $100 million windfall makes the Saudi gifts to Jimmy Carter look like, well, peanuts. The purchase gave Al Jazeera its long awaited entre to American audiences, along with some air of legitimacy by being praised by the former vice president after the sale. Qatar has been a primary bankroller of the radical fighters of the Arab Spring, and Al Jazeera has been its cheerleader. The Shiites, secularists, and Christians are suffering from Qatar’s activities, but Al Jazeera and Al Gore have made out like bandits from the transaction. Although Gore was highly outspoken against the war in Iraq, he has been fairly quiet about American involvement in Libya and Syria—involvement which is supported and encouraged by Qatar. A cynic may wonder whether Gore’s silence was purchased.

John Kerry—When Kerry ran for president in 2004, Iranian-American donor Hassan Nemazee gave him $100,000. Nemazee had served earlier on the board of the pro-Khomeini American Iranian Council. Kerry signaled during the campaign that he would pursue areas of mutual interest with Iran, and complained that George Bush didn’t give Iran “nuclear fuel” to see whether or not Iran would use it peacefully. As secretary of state, Kerry has pursued diplomatic negotiations with Iran in Geneva despite Iranian President Rouhani’s history of deceiving the West about Iran’s nuclear program. Eventually, Hassan Nemazee pleaded guilty and was sentenced to 12 years in prison for defrauding banks with phony collateral to borrow money to finance his Democrat fundraising activities. Nemazee also served as a fundraiser and adviser to Hillary Clinton before going to prison.

Barack Obama—Before he was elected, there were allegations that Barack Obama got help as a student from Saudi agent Khalid al-Mansour for law school expenses and as an adult from sweetheart deals by Syrian-American real estate developer Tony Rezko. Like Kerry and Hillary Clinton, Obama also received campaign donations from Hassan Nemazee. Donations totaling $30,000 were made to the 2008 Obama campaign from two brothers in Gaza in violation of campaign finance laws; the donations were said to be returned after the donations became public. California businessman Kareem Ahmed was a “million dollar donor” to the Obama campaign and Democratic causes in 2012, and his offices were raided by the local district attorney last year.

 

A lot of the donors here are anti-Semitic, and they are supporting these politicians because they believe they can help them undermine Israel’s security. Saudi Arabia in particular has a long history of trying to buy elections around the world, not only supporting Wahhabi causes and groups, but “secular” and mainstream entities such as universities and philanthropies in order to curry broad institutional favor from the West. These cases, even if the money had zero influence on the politicians in question, illustrate the great lengths to which wealthy Arab donors and sometimes pro-Iranian donors will go in an attempt to influence U.S. politics and foreign policy in their favor.

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Bitcoin helps Iranian business evade sanctions

November 22, 2013

U.S. president on Iranian sanctions

Another loophole has materialized in Pres. Obama’s “toughest sanctions ever.”  Not that it really matters when we’re offering $20 to $50 billion in sanctions relief anyway if Iran agrees to scale back on its nuclear program somewhat.

By the way, if bitcoin can help businesses in Iran to skirt international sanctions, can’t bitcoin help Hezbollah as well?

From CoinDesk on Nov. 5:

Bitcoin helps Iranian shoe store overcome international trade sanctions

Jon Southurst

An interesting e-commerce site that went online just last week is accepting bitcoin only, because most overseas customers cannot pay with anything else.

The business is Persian Shoes, an over 70-year-old business selling handmade footwear. It is located in Isfahan, the third-largest city in Iran.

The owners are happy to ship anywhere, but paying them is a problem. Thanks to the vagaries of international diplomacy and the past few decades of history, the usual e-commerce channels are blocked.

Trade sanctions against the entire country of Iran by the United Nations, United States, European Union and others mean Western Union and major credit card companies will not deal with Iranian businesses, even those in the fashion world.

The only way to pay someone in Iran is with cash carried in your pocket – or some easily transferrable, mostly unregulated, digital currency.

The bitcoin-only store sold four pairs of shoes in its first day of business. “To my standards it is a good sale!” said the CEO, Mor Roghani. The store’s success continued throughout its first week.

“We have sold ten pairs of shoes so far using bitcoin. This is way above our expectations,” he added.

Persian Shoes is currently operated by three brothers, who are keen to expand the business their father started. Roghani’s cousin, who lives in Australia, introduced them to bitcoin and helped them to set up the site.

The site currently offers leather handbags, purses and shoes for women and seven varieties of shoes for men. Prices are all listed in USD and start around US $80.

Its FAQ page explains bitcoin and guides new users to online services like Coinbase, Bitstamp and BitBargain, as well as LocalBitcoins. It also explains the trade situation:

Our business is making and selling leather products. We like to sell our products across the world and the more customers the better. The problem is we operate in Iran and most payment systems either are not willing to serve us at all or impose a huge risk on our business. Before launching this website, our international sale has been limited to a few dedicated customers who knew about the quality of our products and were prepared to go through a lot of trouble to pay us! This of course, may sound incomprehensible for people who have all sorts of electronic payments at their disposal. However, before finding out about bitcoin, receiving our money was the number one obstacle in expanding our business.

As well as international trade restrictions, exchanging bitcoin back into local currency (Iranian Rials) also faces knowledge and technical barriers.

“Exchange is a bit tricky because bitcoin is not common yet. We are planing to hold onto some of the bitcoins and sell some at localbitcoins,” Roghani said. A lack of online shopping culture locally and poor internet connectivity hinders trade with other parts of Iran.

Depending on your country of citizenship or residence, you may not actually be allowed to buy these shoes even with bitcoin. Just as Americans may not spend a weekend in Havana or enjoy real Cuban cigars, they are also forbidden to engage in any trade activity with businesses or individuals located in Iran.

Despite this, Persian Shoes has taken orders from customers in the US and is waiting to see how smoothly the deliveries go before advertising the business more widely (update: all US orders have reached their destinations so far without problems.)

A query sent to United States Customs and Border Protection (part of the Department of Homeland Security) asking specifically about private e-commerce transactions for items of clothing received the following response: “Unfortunately, sanctions against Iran prohibit this”…

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The colossal folly of arming the rebels

August 9, 2013

The Obama administration may have directed the CIA to ship weapons covertly from Libya to Syrian rebels, creating a tempting target for the terrorists who attacked the U.S. mission in Benghazi on Sept. 11, 2012, according to a growing chorus of reports:

World Net Daily has more about the story:

CNN is reporting lawmakers are speculating on the possibility U.S. agencies operating in the Benghazi compound attacked Sept. 11, 2012, were secretly helping to transfer weapons from Libya, via Turkey, to the rebels in Syria.

That possibility was first reported by WND two weeks after the Benghazi attack, when the news agency cited Egyptian security officials who said murdered U.S. Ambassador Christopher Stevens played a central role in arming and recruiting rebels to fight Syrian President Bashar al-Assad.

In November 2012, Middle Eastern security sources further described both the U.S. mission and nearby CIA annex in Benghazi as an intelligence and planning center for U.S. aid to the rebels, which included weapons shipments being coordinated with Turkey, Saudi Arabia and Qatar.

Many rebel fighters are openly members of terrorist organizations, including al-Qaida.

The information may help determine what motivated the deadly attacks in Benghazi.

The State Department told CNN it was helping the new Libyan government destroy weapons deemed “damaged, aged or too unsafe retain” but denied it was transferring weapons to other countries.

The State Department, however, clarified it “can’t speak for any other agencies.”

The CIA would not comment to CNN on the weapons-transfer reports.

Meanwhile, clarification on the weapons transfers may have inadvertently come through recent statements by a Libyan weapons dealer from a group hired to provide security to the U.S. mission in Benghazi. The dealer told Reuters he has helped ship weapons from Benghazi to the rebels fighting in Syria.

The detailed account may provide more circumstantial evidence the U.S. Benghazi mission was secretly involved in procuring and shipping weapons to the Syrian opposition before the deadly attack that killed the U.S. ambassador and three other Americans.

In an interview with Reuters published in June, Libyan warlord Abdul Basit Haroun declared he is behind some of the biggest shipments of weapons from Libya to Syria. Most of the weapons were sent to Turkey, where they were then smuggled into neighboring Syria, he said.

Haroun explained he sent a massive weapons shipment from the port in Benghazi in August 2012, days before the attack on the U.S. compound. The weapons were smuggled into Syria aboard a Libyan ship that landed in Turkey purportedly to deliver humanitarian aid…

Management of the failed gunrunning operation from Libya to Syria appears to have been since been transferred to Qatar.

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Obama’s 10 biggest terror finance blunders

November 5, 2012

  1. Promising to make it easier for Muslims to give zakat.  Pres. Obama has tried to remove the so-called “chilling effect” that George W. Bush, the Patriot Act, the Treasury Department, and law enforcement “created” by closing down Islamic charities that funded terrorism.  Rather than building on the Bush administration’s successful prosecution of the Holy Land Foundation for sponsoring Hamas, Obama won’t prosecute Islamic Relief, he won’t prosecute CAIR, he won’t investigate ISNA or NAIT, and the IRS has been derelict in stripping suspicious Islamic organizations of their tax-exempt status.
  2. Funding the Arab Spring that has led to the rise of Muslim Brotherhood dominated governments in the Middle East who behave against U.S. national security interests.
  3. Minimizing our energy independence from Middle East oil by reducing oil production on federal lands and waters, rejecting the Keystone XL pipeline, impeding hydraulic fracturing permitting, etc.
  4. Making little to no progress on bankrupting the Taliban.
  5. Dragging his feet in adopting sanctions against Al Qaeda and Taliban affiliates such as the Pakistani Taliban and the Haqqani network. Read the rest of this entry ?
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Expert: Obama’s Syria license “dangerous”

November 3, 2012

What good are sanctions against funding Al Qaeda if the Treasury Department issues a blanket license to the Islamist-dominated Syrian Support Group to sponsor whatever causes it deems fit in Syria?  It is worse than simply letting the SSG operate in Syria—it is giving them the express legal authority to do so.  If the money ends up in the wrong hands, the SSG can always say, “We got a license from the U.S. government.  Don’t blame us.”

By Patrick Poole on Oct. 25:

Anti-Terror Authorities Question Where Money Goes From Group With Special License From Obama Administration

In July, the Obama State Department approved an extraordinary license for a newly formed U.S.-based organization, the Syrian Support Group, to raise money for Syrian rebels – overriding the administration’s own sanctions and Obama’s Executive Order against such activity.

To some counterterrorism and terror finance authorities in Washington D.C., this extremely rare privilege raises considerable concerns.

This is especially true because two related figures with the organization, Louay Safi and Mazen Asbahi, have previously been tied to terror fundraising efforts by Islamic organizations identified by the U.S. government in federal court as fronts for the Muslim Brotherhood.

One U.S. Treasury official specializing in terror finance said:

This license sets a dangerous precedent because it gives complete and perfect cover to virtually all of their activities. They can honestly say, “I can’t be fundraising for terror because I have a license from the State Department.” But we have absolutely no idea where that money is going once it leaves the United States. And as the Supreme Court recognized in a court case a few years ago, money raised for terrorist groups is fungible.

The situation in Syria is so fluid, we don’t have the slightest idea who is actually benefiting from this money being raised here, and anybody from the administration who says that they do is bald-faced lying.

The Syrian Support Group was incorporated in April 2012, according to records obtained from the District of Columbia Corporations Division.

On May 24, the group sent a letter to the State Department’s Office of Foreign Assets Control, and on July 23 that same office issued the license – a copy of which was obtained by The Blaze – allowing them to “export, reexport, sell, or supply to the Free Syrian Army (‘FSA’) financial, communications, logistical, and other services otherwise prohibited by Executive Order 13582 in order to support the FSA.”

The Free Syrian Army is affiliated with the Syrian National Council governed by that group’s military bureau, which is overwhelming dominated by Islamist groups, including the Syrian Muslim Brotherhood…

Details of the Muslim Brotherhood connections are laid out in The Blaze.

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Freedom from Middle East oil

November 2, 2012

Sheldon Adelson has launched a new political action committee, the New American Energy Opportunity Foundation, and an advertising blitz in support of domestic drilling and energy production leading up to the Nov. 6 presidential election.  Take a look at this excellent ad in particular.  The audio of it has been running on conservative talk radio stations, too:

The opening of the spot says it all.  “When will America be free from Middle East oil?”  We’re getting there, despite Pres. Obama’s best efforts to retard domestic energy production and deny the fact that we have more energy resources than Saudi Arabia or Iran.  Barack Obama has reduced permits for drilling on federal lands and waters, he has obstructed the Keystone pipeline, and his EPA has delayed efforts to expand hydraulic fracturing—a technique which enables producers to drill for previously inaccessible oil and natural gas deposits.

Despite the president’s crummy record, oil companies have managed to boost domestic output on privately owned land and shift the balance of energy power away from OPEC back to the Americas.  Romney would strengthen this trend by supporting the initiatives that Obama has blocked.

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Muslim charity honcho embraced by Obama

October 30, 2012
Palestinian Arab from Jordan

Abed Ayoub, CEO of Islamic Relief USA

Ryan Mauro reports that the executive branch of the federal government has been consulting with Abed Ayoub, the chief executive officer of North America’s largest Islamic charity, Islamic Relief USA (IR-USA), for the past two years.

IR-USA serves as a conduit for zakat donations from Muslim Americans to fund programs overseas—a portion of which is transferred to Islamic Relief Worldwide (IRW), its British-based parent organization.  IRW has been implicated by Israel for funding Hamas, and at least one high-ranking source in the Department of Justice equates Islamic Relief with the infamous Holy Land Foundation—formerly America’s largest Muslim charity before its leaders were convicted on all counts of financing Hamas.

The revelation of Mr. Ayoub’s involvement in lobbying U.S. officials on matters of diplomacy and foreign aid is disturbing but not surprising.  The State Department has previously issued press releases praising Islamic Relief’s operations, for example, in Haiti.  The U.S. Department of Agriculture has also worked directly with IR-USA on food programs.

Yeesh.  From RadicalIslam.org on Oct. 24:

Exclusive: Islamist Adviser to the State Dept and USAID Exposed

Abed Ayoub, the CEO of Islamic Relief USA, a powerful charity with links to Hamas is an official advisor to the State Department and USAID (U.S. Agency for International Development), a RadicalIslam.org investigation has found.

Ayoub has been advising the Obama Administration since at least April 2010. He and his organization have been publicly embraced by President Obama and Vice President Biden.

Ayoub was born in a Palestinian refugee camp and raised in Jordan. After high school, he moved to Yugoslavia and Germany and ultimately ended up in California. He became a volunteer for the Islamic Relief USA (IRUSA) and went on to become its CEO in 2008. He is a governance committee member of Islamic Relief Worldwide (IRW), IRUSA’s parent group. He is also on the Board of Trustees of the Center for Interfaith Action on Global Poverty.

Ayoub joined the State Department’s Religion and Foreign Policy Working Group in November 2011, specifically the Sub-Group on Faith-Based Groups and Development and Humanitarian Assistance, according to IRUSA’s press release. It says he will “take part in dialogue and provide input on relevant topics including the challenges and opportunities for partnership. The group also will identify model action programs or projects for collaboration between the U.S. government and NGOs.” The release says it will “meet through November 2012.” The timing and phrasing suggests that this isn’t the group’s expiration date and that the election will determine whether its work continues next year.

According to his bio, Ayoub was appointed to the U.S. Agency for International Development’s Advisory Committee on Voluntary Foreign Aid in April 2010, where he “provides advice, analysis and recommendations to USAID on the most pressing development issues in the world today.” He was reappointed to another two-year term in May…

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Offshore oil production fell 14% under Obama

October 22, 2012

U.S. energy independence has improved in recent years due to boosted output through hydraulic fracturing and higher production on privately owned land.

The U.S. would be even less reliant on Saudi oil, and could have moved faster on adopting sanctions against Iranian oil, if it weren’t for the Obama administration’s obstructionism on drilling offshore.

Check out this Romney campaign graphic which lays out Pres. Obama’s lousy record on energy:

Offshore crackdown by Obama

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Western aid to Syrian rebels mounts

August 15, 2012

Syrian rebels have been funded by Saudi Arabia and Qatar from the outset of the uprising against Bashar al-Assad.  The U.S. and Britain have become financially committed in recent months as well.  Note the recent developments:

The Western aid fits the pattern of taxpayer money given as foreign aid to the foot soldiers of the Arab Spring.  The first problem with the Syrian aid, as with the Egyptian and Libyan aid that preceded it, is that the cash winds up in the pockets of rebels who carry dual membership with Al Qaeda.

The second problem is that the Syria Accountability Act prohibits Americans from exporting goods to and doing business with Syria.  The law permits federal aid to Syria if and only if Syria restores Lebanese sovereignty, renounces Hezbollah, and terminates its weapons of mass destruction programs.  Those conditions haven’t been met.

Granted, the reported aid isn’t going to the Syrian regime, but the 2003 act does not make a distinction between the Syrian regime and Syrian dissidents.

Keep in mind that if you tried sending or selling supplies without a license to anybody in Syria, you would be arrested, put on trial, and convicted for export violations.  Just ask Mazen Ghashim, who was convicted for export violations in 2008 for shipping computers to Syria.

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5 ways to fight zakat for jihad

August 6, 2012

Zakat, the Muslim wealth tax and pillar of Islam from which profits can funneled to the mujahideen, has been used repeatedly to fund jihadist operations across the world including the 9/11 terror attacks and the Iraq insurgency.  Despite zakat’s bone-chilling track record, it is extremely unlikely if not impossible to impose an outright ban the practice.

That doesn’t mean we can afford to shrug our shoulders and do nothing to counter the violent, jihadist stream of zakat to terrorism.  We certainly should not, as Pres. Obama said in Cairo, promote zakat-giving by American Muslims.

Here are five models that could be used individually, but preferably in tandem to achieve the best results, to limit the ability of zakat solicitors and donors to use the funds for militant purposes:

5.  The NYPD surveillance model.  The New York Police Department’s surveillance program has been criticized by the Leftist media and Muslim “rights” agitators.  But the NYPD approach offers one of the few hands-on, common sense methods of determining which mosques and charities knowingly undertake to fund terrorism overseas and at home.  Embedding undercover mosque crawlers is not a violation of civil liberties or the freedom to worship—it is a sensible measure based on experience.  The NYPD model could be employed by major metropolitan police departments in places such as Chicago, Minneapolis, and Dearborn.

4. Improved state regulatory oversight.  In the U.S., charities are regulated at the state level, as they should be.  The federal government does not have the enumerated constitutional authority or the wisdom to regulate philanthropy.  But state governments and their top charitable regulators—usually either the state’s secretary of state or attorney general—can and must exercise their authority to oversee nonprofit entities.  The state elected officials should improve their provision of searchable, online records of charities’ registration and renewal documents, and should require the disclosure of information about the president and boards of the charities, etc.  Citizens should be aware of the important role that these statewide elected officials play in shining the sunlight, particularly on small Islamic charities that lack transparency.  Nationwide crackdowns on disreputable charities such as the “Operation False Charity” initiative should be replicated against Muslim organizations that purport to solicit donations for charity, but actually use them for Wahhabi and jihadi endeavors.

3.  The Canadian model.  The Canadian Revenue Agency has done a commendable job of carefully examining the charitable credentials of Islamic entities.  CRA has recently revoked the tax-exempt status of several of Canada’s most dubious Islamic charities including WAMY, the World Islamic Call Society, and IRFAN.  The IRS should take a page from Canada’s book and immediately strip IFANCA of its 501(c)3 status, for example.

2.  Sanctions model.  The authority to designate foreign charities as terrorist entities has been used somewhat appropriately by successive leaders at the State and Treasury Departments, but there are glaring examples of foreign philanthropic foundations that have not been designated due to diplomatic sensitivities.  The Saudi-based International Islamic Relief Organization has never been designated although its branches in the Philippines and Indonesia have been recognized by the U.S. as Al Qaeda affiliates.  The Muslim World League and the World Association of Muslim Youth are two other examples of “humanitarian” religious agencies that provide significant Saudi financial support for terrorism.  The U.S. has designated the Union of Good as a terrorist network, but it has not identified the member organizations of UoG (although Israel has).  We’re never going to confront the problem of Saudi terror funding through zakat unless we’re willing to name and shame the biggest Saudi perpetrators.

1.  The Bush/HLF model. The successful prosecution of the Holy Land Foundation for funding Hamas offers an aggressive law enforcement model that would require a renewed federal commitment.  Raids, seizures, and closures of suspect organizations and charities can take place under the executive order authorities of the President or ordinary criminal warrants.  The worst Islamic charities should be prosecuted under the material support provisions of the the Patriot Act.  We have to put the leaders of the worst offending Islamic charities into orange jumpsuits to set the example for other Muslims who wish to do the same.

Sadly, the Obama administration has tended to pursue a far more limited “settlement model,” in which the Department of Justice enters settlements and U.S. attorney agree to plea deals with jihadists’ attorneys.  Yes, some go-getter U.S. attorneys have continued to prosecute individual terror financiers and even a Hezbollah funding network.  But the big picture strategy of investigating, closing, and prosecuting major Islamic charities has been totally abandoned by the Obama administration.

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Treasury settles for less

June 15, 2012

Trade sanctions attorney Erich Ferrari has an interesting take on a recent settlement between OFAC (an agency within the Treasury Department) and Genesis Assets Managers, a U.S. firm that invested in a company whose investment portfolio is made up entirely of Iranian securities.  Such a blatant violation of U.S. sanctions laws would normally prompt prosecution and a heavy fine, or at least a higher settlement amount than what OFAC ultimately agreed to.    Here’s what Mr. Ferrari says about the settlement:

Today, the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced that Genesis Assets Managers, LLP (GAM) was paying $112,500 to settle apparent violations of the Iranian Transactions Regulations (ITR). In short, GAM a U.S. based firm serving as a investment manager for Genesis Emerging Markets Fund, violated the ITR when its agent, Genesis Investment Management, LLP invested $3 million to Cayman Islands’ based First Persian Equity Fund on behalf of GAM. First Persian Equity Fund is a company which invests solely in Iranian securities.

Despite OFAC finding that GAM failed to use a minimum amount of caution, provided a substantial benefit to Iran through their actions, and had knowledge of the transactions, OFAC stated that GAM’s activities were not egregious. I must say I was surprised by OFAC’s finding that the activity was non-egregious, considering this is a financial services firm operating without any sort of OFAC compliance program. Moreover, OFAC admits GAM’s activities undermined the sanctions program by providing a substantial economic benefit to Iran. There must have been a great deal of lawyering done to convince OFAC that this activity wasn’t completely reckless.

There were a few things working in GAM’s favor when OFAC determined what settlement amount was appropriate. First, they self-disclosed the apparent violation; thereby reducing any base penalty by half. Second, they substantially cooperated with OFAC during its investigation. Third, they took steps to remediate the violations. Finally, and quite surprisingly, OFAC stated that GAM may not have known of their OFAC obligations under U.S. law. Again, I am surprised by this, as those in the financial services industry should be more on aware of OFAC and the sanctions programs it administers than anyone. Indeed, the financial services industry is the first line of defense for catching and preventing OFAC violations.

Despite my surprise at how OFAC is viewing the apparent violations, I think it goes to show what a great tool the voluntary self-disclosure program can be. Since OFAC found that the transactions were non-egregious and GAM self-disclosed the base penalty was capped at $125,000. Therefore, mitigation based on other factors found in the OFAC Enforcement Guidelines was only $12,500 or about 10% of the base penalty. However, when one considers that the base penalty could have been in the millions, it really does seem like GAM received a massive break from OFAC.

Mr. Ferrari expresses “surprise” at the leniency of the settlement.  But this event does seem consistent with the Obama administration’s tendency to enter settlements with sanctions violators and terror financiers.

By the way, aren’t we repeatedly told that the Obama administration (including Geithner and Clinton) has adopted the toughest sanctions regime against any country ever?  Yet in this instance, a clear sanctions violator is let off with a slap on the wrists.

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