The U.S. Treasury Department on July 20 said it was fining global oil company ExxonMobil Corp. (NYSE: XOM) $2 million for violating sanctions on Russia in May 2014.
The heads of the company’s U.S. subsidiaries signed eight documents between May 14 and May 23, 2014, with Igor Sechin, the head of Russia’s largest oil producer, Rosneft, Treasury’s Office of Foreign Assets Control said in a statement on its website.
Sechin had been blacklisted by the U.S. just weeks earlier.
The Treasury unit, which enforces sanctions, found ExxonMobil had not voluntarily self-disclosed the violations, “and that the violations constitute an egregious case.”
Rex Tillerson, ExxonMobil’s CEO at the time of the dealings, is now U.S. secretary of state. The State Department referred questions about the fine and Tillerson’s knowledge of the dealings to ExxonMobil.
ExxonMobil said it fully complied with sanctions guidelines in 2014 from former President Barack Obama’s administration that ongoing oil and gas business activities with Rosneft were allowed, but not personal dealings with Sechin.
The oil company cited a May 2014 Treasury Department spokesman’s comments that BP Chief Executive Bob Dudley, an American citizen, would be allowed to remain on Rosneft’s board so long as he did not discuss personal business with Sechin.
The Treasury Department “is trying to retroactively enforce a new interpretation of an executive order that is inconsistent with the explicit and unambiguous guidance from the White House and Treasury issued before the relevant conduct and still publicly available today,” ExxonMobil spokesman Alan Jeffers said in a statement.
On April 28, 2014, the Treasury announced it was sanctioning Sechin as part of a package of measures aimed at pressuring Russia over its intervention in Ukraine and said he had shown “utter loyalty to Vladimir Putin,” Russia’s president.
The sanctions prohibit U.S. citizens or those located in the U.S. from dealing with those on the blacklist.