Ubiquiti Networks, Inc. OFAC Settlement: $504.2K (2014)

From on or about March 24, 2008, to in or around February 2010, Ubiquiti appears to have violated §§ 560.206 and 560.208 of the ITSR by engaging in transactions related to the exportation, reexportation, sale or supply of goods for broadband wireless connectivity to Iran, and facilitating the reexportation, sale or supply of such goods to Iran. Ubiquiti entered into an agreement granting a distributor in the United Arab Emirates exclusive rights to distribute Ubiquiti's goods in Iran, then subsequently sold to the U.A.E. distributor and exported or shipped to the U.A.E. goods that were reexported to Iran.

Additionally, from on or about December 1, 2009, to on or about February 25, 2011, Ubiquiti appears to have violated § 560.204 of the ITSR by engaging in 13 exports of goods for broadband wireless connectivity to a distributor located in Greece, with knowledge or reason to know that the goods were intended specifically for supply, transshipment, or reexportation, directly or indirectly, to Iran. In total, the conduct resulted in the provision of goods related to broadband wireless connectivity worth at least $588,938 to entities located in Iran.

OFAC determined that Ubiquiti did not voluntarily disclose the apparent violations, and that the conduct constitutes a non-egregious case. The base penalty for the apparent violations was $560,250. The settlement amount of $504,225 reflects OFAC's consideration of the General Factors under OFAC's Economic Sanctions Enforcement Guidelines, 31 C.F.R. part 501, app. A. Factors bearing on the outcome included Ubiquiti's reckless disregard for U.S. sanctions requirements; notice in February 2010 that the conduct constituted a violation of U.S. law; senior management knowledge or reason to know that Ubiquiti products were reexported to Iran; a pattern of conduct over approximately five years resulting in several apparent violations; and the absence of an OFAC compliance program at the time of the apparent violations. Offsetting considerations included Ubiquiti's lack of prior sanctions history, cooperation with OFAC during its investigation, and remedial action taken in response to the apparent violations.

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