The award winning, Compliance into the Weeds is the only weekly podcast which takes a deep dive into a compliance related topic, literally going into the weeds to more fully explore a subject. Looking for some hard-hitting insights on compliance? Look no further than Compliance into the Weeds! In this episode of Compliance into the Weeds, Tom Fox and Matt Kelly discuss a recent OFAC enforcement action fining FTI Consulting $1.05 million for a sanctions violation involving indirect dealings with Russia’s state-owned VTB Bank.
FTI provided economic analysis for VTB in litigation but, knowing VTB was sanctioned, used a law firm as an intermediary to invoice and receive payment, which OFAC said does not avoid liability because prohibitions apply to indirect transactions as well as direct ones. OFAC doubled the base penalty of $525,000 explicitly to promote future compliance by similarly situated companies, signaling strong disapproval of “middleman” structures. The case also involved unpaid invoices that became an impermissible extension of credit to a sanctioned entity, highlighting the need for rigorous contract and payment-term review beyond basic sanctions screening and for dedicated sanctions expertise.
Key Highlights
- Introducing the OFAC Case
- Middleman Billing Scheme
- Why Screening Misses Indirect Risk
- Did Compliance Approve It?
- OFAC Expectations and Capability
- Penalty Doubled Warning Shot
- Unpaid Invoices as Credit Extension
Resources
Matt in Radical Compliance
Tom
A multi-award winning podcast, Compliance into the Weeds was most recently honored as one of a Top 25 Regulatory Compliance Podcast and a Top 10 Business Law Podcast, and a Top 12 Risk Management Podcast. Compliance into the Weeds has been conferred a Davey, Communicator and w3 Award, all for podcast excellence.