Treasury Department Fines Exxon Mobil for Russia Sanctions Violations

U.S. Secretary of State Rex Tillerson attends a joint news conference with Qatar's foreign minister Sheikh Mohammed bin Abdulrahman al Thani in Doha Qatar

"It's time Rex Tillerson step down or be removed", said Gigi Kellett of Corporate Accountability International, following an announcement on Thursday that ExxonMobil will pay $2 million for violating US sanctions against Russian officials while the now-secretary of state was the company's CEO. "OFAC determined that ExxonMobil did not voluntarily self-disclose the violations to OFAC, and that the violations constitute an egregious case", Treasury announced.

The Treasury said Exxon displayed "reckless disregard" for the sanction order, and senior company officials knew of Sechin's sanctioned status when they completed the business deal in 2014.

Exxon called the $2 million penalty "fundamentally unfair", saying in a statement that it is "inconsistent with the explicit and unambiguous guidance" issued at the time by the White House and Treasury about the sanctions.

Sechin is the CEO of Russian state oil giant Rosneft and a close ally of Russian President Vladimir Putin.

Exxon-which made almost $8 billion in profit previous year and could perhaps afford better lawyers-called the action "fundamentally unfair".

Treasury's Office of Foreign Assets Control, or OFAC, said Exxon caused "significant harm" to the sanctions program by engaging in transactions with a person who is "an official of the government of the Russian Federation contributing to the crisis in Ukraine".

Yet the Treasury Department said that Exxon's "senior-most executives" knew Sechin was blacklisted when two of its subsidiaries signed deals with him.

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Tillerson left ExxonMobil to become secretary of state after 10 years at the helm of the global energy power.

OFAC said it considered several aggravating factors when reaching its decision.

Publicly available guidance on Treasury's website at the time of Exxon's dealings with Sechin said Americans should ensure they do not enter into contracts signed by sanctioned individuals, OFAC said. Those sanctions cost his company hundreds of millions of dollars.

Exxon applied for a waiver from these same sanctions in April, but the Treasury Department denied them.

Mr Sechin was Mr Tillerson's main partner as Exxon sought to drill in the Arctic's Kara Sea, which has vast untapped potential.

The sanctions were originally put into place by the administration of former President Barack Obama after Russia's annexation of Crimea. Igor Sechin, president of Rosneft, had been on the department's List of Specially Designated Nationals and Blocked Persons list (SDN), establishing a clear violation of the sanctions by ExxonMobil.

Exxon signed the agreements between May 14 and 23, 2014.

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