Tuesday, April 7, 2009

Playing Cat and Mouse With the Treasury

The Treasury today designated a Chinese individual and his entities under Executive Order 13382. A designated individual or entity under E.O. 13382 is an authority aimed at freezing the assets of alleged weapons of mass destruction proliferators and those who alledgedly support them.

The Treasury release provides some detail as to the cat and mouse game that goes on:

LIMMT, a Chinese firm, was designated by Treasury on June 13, 2006, for providing material support to Iran’s missile program. The individual named today, Li Fangwei (also known as Karl Lee), is the commercial manager of LIMMT. For several years, Lee, acting on behalf of LIMMT, has sold needed goods such as graphite to entities involved with Iran’s missile program. Treasury's 2006 designation disrupted LIMMT'S export and financing channels, and numerous attempts by LIMMT to receive payment were thwarted. To compensate and circumvent sanctions, Lee created front companies to access the global financial system. In doing so, LIMMT had to juggle multiple aliases and confronted operational difficulties and customer confusion. LIMMT told one customer: "please kindly arrange your accounting department to pay for the invoice to our following new company name and account number instead of previous company name and account no., this is very important !!! otherwise, the money can be blocked as of last time!!!" On another occasion, it instructed its customer, "you are kindly required NOT to inform our following previous identifying information to U.S. bank or U.S. Treasury Department.... [W]hat you should do is let them know that SINO METALLURGY & MINERALS INDUSTRY CO., LTD. is a company who is NOT related to LIMMT company and any other Company on the Specially Designated National (SDN) list of U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC)."

Today OFAC is adding the names of eight such LIMMT front companies as aliases to the list of Specially Designated Nationals. These front companies include Ansi Metallurgy Industry Co. Ltd.; Blue Sky Industry Corporation; Dalian Carbon Co., Ltd.; Dalian Sunny Industry & Trade Co., Ltd.; Liaoning Industry and Trade Co., Ltd; SC (Dalian) Industry & Trade Co., Ltd.; Sino Metallurgy & Minmetals Industry Co., Ltd; and Wealthy Ocean Enterprises Ltd.

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