The US Treasury's Office of Foreign Assets Control has determined that 3M's "apparent violations" were "egregious." No great surprise there: it's part of the Department's standard up-selling of offences. The material that was sold has no purely military or law enforcement purpose: it is nothing more than a reflective material that will later be incorporated into other products with no purely military or law enforcement purpose.

But that is not the point. The point is that the deal was done, with the full knowledge and even assistance, of employees of the Swiss company to make sales via a third party to sanctioned persons.

The most obvious point of failure is that those at the Swiss company, despite knowing the identity of the end user, performed sanctions screening against only the German intermediary. Moreover, an independent review identified the transactions as apparently being in breach but the reports were dismissed.

But 3M in the USA found out about it anyway and reported it to OFAC. As a result, the settlement figure was set at USD9,618,477. Without that discount, the penalty would have been USD13,740,682. There were serious aggravating factors not the least of which was that the staff in the subsidiary "wilfully" breached US sanctions and "numerous other 3M employees were reckless." Worse, 3M employees had actual knowledge of the illegality of the deal before the agreement was signed with the German company.

There's a lot more to this story not the least of which was that the export of finished product was permitted but not to e.g. law enforcement. Also, there was no waiver for the film, regardless of who it might be sold to.

OFAC emphases the need for effective training across organisations while accepting that those who set up the scheme knew they were doing wrong. Is OFAC subtly saying that training should contain, as a central thesis, whistleblowing?

Read OFAC's full report here: https://ofac.treasury.gov/media/932161/download?inline