OFAC reaches settlement with Chubb and Allianz over apparent Cuba violations

The US Treasury’s Office of Foreign Assets Control (‘OFAC’) has reached settlements with insurers Chubb Limited and Allianz Global Risks US Insurance Company (‘AGR US’) for apparent violations of the Cuba embargo.

OFAC announced on 9 December 2019 that it had agreed a $66,212 settlement with Chubb Limited over a case linked to travel insurance: ‘Chubb has agreed to remit USD 66,212 to settle its potential civil liability for 20,291 apparent violations of the Cuban Assets Control Regulations (CACR).’ The settlement relates to the processing of transactions over a four-year period from 1 January 2010 to 31 December 2014 by subsidiaries of ACE Limited, a Swiss insurance company that merged with Chubb Corporation in January 2016.

As a subsidiary of a US company, ACE Europe was subject to CACR regulations, OFAC noted.

The transactions included premium payments totalling $287,292 that ACE received for Cuba-related travel insurance coverage, as well as 73 Cuba-related claims payments paid out worth $80,555.

‘The apparent violations appear to have been caused by ACE’s misunderstanding of the applicability of US sanctions on Cuba with respect to this activity,’ OFAC noted.

Separately, OFAC announced that it had agreed a $170,535 settlement with AGR US, a Chicago-based subsidiary of German financial services group, Allianz SE.

The settlement relates to 6,474 apparent violations of CACR, 31 C.F.R. Part 515, OFAC said.

It added that, in both cases, AGR US and Chubb voluntarily self-disclosed the apparent violations, and that the apparent violations constitute a non-egregious case.

See: https://www.treasury.gov/resource-center/sanctions/CivPen/Documents/20191209_ace.pdf