Action Affecting Export Privileges; Bob Rahimzadeh, 16735-16737 [2010-7437]

Agencies

• DEPARTMENT OF COMMERCE
• Bureau of Industry and Security
• Industry and Security Bureau

[Federal Register Volume 75, Number 63 (Friday, April 2, 2010)]
[Notices]
[Pages 16735-16737]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-7437]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

[09-BIS-005]


Action Affecting Export Privileges; Bob Rahimzadeh

    In the Matter of: Bob Rahimzadeh, 116 Hopper Lane, Folsom, CA 
95630, Respondent; Order Relating to Bob Rahimzadeh.

    The Bureau of Industry and Security, U.S. Department of Commerce 
(``BIS''), initiated this administrative proceeding against Bob 
Rahimzadeh (``Rahimzadeh'') pursuant to Section 766.3 of the Export 
Administration Regulations (the ``Regulations'') \1\, and Section 13(c) 
of the Export Administration Act of 1979, as amended (the ``Act'') \2\, 
through the issuance and filing of a charging letter as to Rahimzadeh 
that alleges that Rahimzadeh has committed four violations of the 
Regulations (``Charging Letter''). Specifically, these charges are:
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    \1\ The Regulations are currently codified in the Code of 
Federal Regulations at 15 CFR parts 730-774 (2009). The violations 
occurred in 2004 and 2005. The Regulations governing the violation 
at issue are found in the 2004 and 2005 versions of the Code of 
Federal Regulations (15 CFR parts 730-774 (2004-2005)). The 2009 
Regulations establish the procedures that apply to this matter.
    \2\ 50 U.S.C. app. Sec. Sec.  2401-2420 (2000). Since August 21, 
2001, the Act has been in lapse and the President, through Executive 
Order 13222 of August 17, 2001 (3 CFR 2001 Comp. p. 783 (2002)), 
which has been extended by successive Presidential Notices, the most 
recent being that of August 13, 2009 (74 FR 41325 (Aug. 14, 2009)) 
has continued the Regulations in effect under the International 
Emergency Economic Powers Act (50 U.S.C. 1701, et seq.) (``IEEPA'').
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Charge 1 15 CFR 764.2(b)--Causing, Aiding or Abetting

    Between on or about July 26, 2004, and on or about September 28, 
2004, Rahimzadeh caused, aided or abetted the doing of an act 
prohibited by the Regulations by facilitating or coordinating the 
export of approximately 174 rolls of hog hair filter media, part number 
HH60130 and valued at approximately $11,687.76, items which are subject 
to the Regulations and designated as EAR99 items,\3\ through the United 
Arab Emirates (``U.A.E.'') to Iran without the required U.S. Government 
authorization. Pursuant to Section 560.204 of the Iranian Transactions 
Regulations (``ITR'') \4\ maintained by the U.S. Department of the 
Treasury's Office of Foreign Assets Control (``OFAC''), an export to a 
third country intended for transshipment to Iran is a transaction that 
requires OFAC authorization. Pursuant to Section 746.7 of the 
Regulations, no person may engage in the exportation of an item subject 
to both the Regulations and the ITR without authorization from OFAC. No 
OFAC authorization was sought or obtained for the transaction described 
herein. Rahimzadeh took this action after having been asked by Parto 
Abgardan Cooling Towers Co. (``Parto Abgardan''), an Iranian company, 
to arrange for the export of the items to Iran ``via Dubai.'' Parto 
Abgardan did not have a location in the U.A.E., and the address to 
which Rahimzadeh arranged for the items to be exported, ``do Parto 
Abgardan,'' was in fact subsequently added to the BIS Unverified List 
of entities involved in transactions in which BIS is unable to verify 
the existence or authenticity of the end-user or other party to the 
transaction, published in the Federal Register on October 19, 2006. 71 
FR 61706 (Oct. 19, 2006).
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    \3\ EAR99 is a designation for items subject to the Regulations 
but not listed on the Commerce Control List. 15 CFR 734.3(c).
    \4\ 31 CFR part 560.
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    In so doing, Rahimzadeh committed one violation of Section 764.2(b) 
of the Regulations.

Charge 2 15 CFR 764.2(e)--Acting With Knowledge of a Violation

    Between on or about July 26, 2004, and on or about September 28, 
2004, Rahimzadeh ordered or financed items to be exported from the 
United States with knowledge that a violation of the Regulations was 
occurring, was about to occur or was intended to occur in connection 
with the items. Specifically, between on or about July 26, 2004, and on 
or about September 28, 2004, Rahimzadeh ordered or financed 
approximately 174 rolls of hog hair filter media, part number HH60130 
and valued at approximately $11,687.76, items which are subject to the 
Regulations and designated as EAR99, which Rahimzadeh knew would be 
exported to Iran via the U.A.E. without the required U.S. Government 
authorization. Pursuant to Section 560.204 of the ITR, an export to a 
third country intended for transshipment to Iran is a transaction that 
requires OFAC authorization. Pursuant to Section 746.7 of the 
Regulations, no person may engage in the exportation of an item subject 
to both the Regulations and the ITR without authorization from OFAC. 
Rahimzadeh knew that no OFAC authorization was sought or obtained for 
the transaction described herein.
    Rahimzadeh had knowledge that a violation was occurring, was about 
to occur or was intended to occur in connection with the items because 
he was aware of the U.S. embargo of Iran and had knowledge that 
exporting items through the U.A.E. to Iran was a violation of U.S. law. 
Rahimzadeh stated to a BIS Office of Export Enforcement special agent 
in an interview on or about October 14, 2005, that approximately three 
years earlier he had become aware of sanctions barring the shipment of 
items to Iran and that he understood that knowingly shipping items to 
Iran through a third country was illegal. Rahimzadeh referred to this 
type of activity as ``diverting'' items to Iran. Moreover, on or about 
September 23, 1997, Rahimzadeh had issued a letter to Parto Abgardan 
stating, ``I am trying to find a way to send the components that I 
promised to you. Unfortunately after many unsuccessful attempts, I came 
to a conclusion that the only way to open this channel is what you were 
thinking, and if I understood

[[Page 16736]]

correctly, you are going to have some kind of agent or office in one of 
the Gulf countries. I tell you this that I would have no problem 
getting a container to my place and loading to a steam ship toward 
Dubai. * * * Many shipping companies express that you shouldn't have 
any major problem getting the goods to Tehran from Dubai.''
    In so doing, Rahimzadeh committed one violation of Section 764.2(e) 
of the Regulations.

Charge 3 15 CFR 764.2(b)--Causing, Aiding or Abetting

    Between on or about February 9, 2005, and on or about April 19, 
2005, Rahimzadeh caused, aided, or abetted the doing of an act 
prohibited by the Regulations by facilitating or coordinating the 
export of approximately 185 rolls of hog hair filter media, part number 
HHB60130 and valued at approximately $9,838.30, items which are subject 
to the Regulations and designated as EAR99 items, through the U.A.E. to 
Iran without the required U.S. Government authorization. Pursuant to 
Section 560.204 of the ITR maintained by OFAC, an export to a third 
country intended for transshipment to Iran is a transaction that 
requires OFAC authorization. Pursuant to Section 746.7 of the 
Regulations, no person may engage in the exportation of an item subject 
to both the Regulations and the ITR without authorization from OFAC. No 
OFAC authorization was sought or obtained for the transaction described 
herein.
    Specifically, after exporting certain hog hair filter media to 
Parto Abgardan in Iran, as described in Charges 1-2, Rahimzadeh was 
informed by Parto Abgardan that the items were not exactly the same as 
a sample Rahimzadeh had previously brought to Parto Abgardan before the 
transaction described in Charges 1-2 occurred. Rahimzadeh received from 
Parto Abgardan a piece of the original sample as well as a piece of the 
items described in Charges 1-2. Rahimzadeh then provided both pieces to 
the U.S. distributor, and placed a new order for 185 rolls of hog hair 
filter media, part number HHB60130, with the U.S. distributor. 
Rahimzadeh arranged for the U.S. distributor to supply the items, which 
were destined for Iran, to a freight forwarder for initial shipment to 
the U.A.E., ``c/o Parto Abgardan.'' Parto Abgardan did not have a 
location in the U.A.E., and the address to which Rahimzadeh arranged 
for the items to be exported, ``c/o Parto Abgardan,'' was in fact added 
to the BIS Unverified List of entities involved in transactions in 
which BIS is unable to verify the existence or authenticity of the end-
user or other party to the transaction, published in the Federal 
Register on October 19, 2006. 71 FR 61706 (Oct. 19, 2006).
    In so doing, Rahimzadeh committed one violation of Section 764.2(b) 
of the Regulations.

Charge 4 15 CFR 764.2(e)--Acting With Knowledge of a Violation

    Between on or about February 9, 2005, and on or about April 19, 
2005, Rahimzadeh ordered items to be exported from the United States 
with knowledge that a violation of the Regulations was occurring, was 
about to occur or was intended to occur in connection with the items. 
Specifically, between on or about February 9, 2005, and on or about 
April 19, 2005, Rahimzadeh ordered approximately 185 rolls of hog hair 
filter media, part number HHB60130 and valued at approximately 
$9,838.30, items which are subject to the Regulations and designated as 
EAR99, which Rahimzadeh knew would be exported to Iran via the U.A.E. 
without the required U.S. Government authorization. Pursuant to Section 
560.204 of the ITR, an export to a third country intended for 
transshipment to Iran is a transaction that requires OFAC 
authorization. Pursuant to Section 746.7 of the Regulations, no person 
may engage in the exportation of an item subject to both the 
Regulations and the ITR without authorization from OFAC. Rahimzadeh 
knew that no OFAC authorization was sought or obtained for the 
transaction described herein.
    Rahimzadeh had knowledge that a violation was occurring, was about 
to occur or was intended to occur in connection with the items because 
Rahimzadeh was aware of the U.S. embargo of Iran and had knowledge that 
exporting items through the U.A.E. to Iran was a violation of U.S. law. 
Rahimzadeh stated to a BIS Office of Export Enforcement special agent 
in an interview on or about October 14, 2005, that approximately three 
years earlier he had become aware of sanctions barring the shipment of 
items to Iran and that he understood that knowingly shipping items to 
Iran through a third country was illegal. Rahimzadeh referred to this 
type of activity as ``diverting'' items to Iran. Moreover, on or about 
September 23, 1997, Rahimzadeh had issued a letter to Parto Abgardan 
stating, ``I am trying to find a way to send the components that I 
promised to you. Unfortunately after many unsuccessful attempts, I came 
to a conclusion that the only way to open this channel is what you were 
thinking, and if I understood correctly, you are going to have some 
kind of agent or office in one of the Gulf countries. I tell you this 
that I would have no problem getting a container to my place and 
loading to a steam ship toward Dubai. * * * Many shipping companies 
express that you shouldn't have any major problem getting the goods to 
Tehran from Dubai.''
    In so doing, Rahimzadeh committed one violation of Section 764.2(e) 
of the Regulations.
    Whereas, BIS and Rahimzadeh have entered into a Settlement 
Agreement pursuant to Section 766.18(b) of the Regulations, whereby 
they agreed to settle this matter in accordance with the terms and 
conditions set forth therein; and
    Whereas, I have approved of the terms of such Settlement Agreement; 
it is therefore ordered:
    First, Rahimzadeh shall be assessed a civil penalty in the amount 
of $100,000, the payment of which shall be suspended for a period of 
ten (10) years from the date of this Order, and thereafter shall be 
waived, provided that during the period of suspension, Rahimzadeh has 
committed no violation of the Act, or any regulation, order, or license 
issued thereunder.
    Second, that for a period of ten (10) years from the date of this 
Order, Rahimzadeh, his representatives, assigns or agents (``Denied 
Person'') may not participate, directly or indirectly, in any way in 
any transaction involving any commodity, software or technology 
(hereinafter collectively referred to as ``item'') exported or to be 
exported from the United States that is subject to the Regulations, or 
in any other activity subject to the Regulations, including, but not 
limited to:
    A. Applying for, obtaining, or using any license, License 
Exception, or export control document;
    B. Carrying on negotiations concerning, or ordering, buying, 
receiving, using, selling, delivering, storing, disposing of, 
forwarding, transporting, financing, or otherwise servicing in any way, 
any transaction involving any item exported or to be exported from the 
United States that is subject to the Regulations, or in any other 
activity subject to the Regulations; or
    C. Benefitting in any way from any transaction involving any item 
exported or to be exported from the United States that is subject to 
the Regulations, or in any other activity subject to the Regulations.
    Third, that no person may, directly or indirectly, do any of the 
following:

[[Page 16737]]

    A. Export or reexport to or on behalf of the Denied Person any item 
subject to the Regulations;
    B. Take any action that facilitates the acquisition or attempted 
acquisition by the Denied Person of the ownership, possession, or 
control of any item subject to the Regulations that has been or will be 
exported from the United States, including financing or other support 
activities related to a transaction whereby the Denied Person acquires 
or attempts to acquire such ownership, possession or control;
    C. Take any action to acquire from or to facilitate the acquisition 
or attempted acquisition from the Denied Person of any item subject to 
the Regulations that has been exported from the United States;
    D. Obtain from the Denied Person in the United States any item 
subject to the Regulations with knowledge or reason to know that the 
item will be, or is intended to be, exported from the United States; or
    E. Engage in any transaction to service any item subject to the 
Regulations that has been or will be exported from the United States 
and which is owned, possessed or controlled by the Denied Person, or 
service any item, of whatever origin, that is owned, possessed or 
controlled by the Denied Person if such service involves the use of any 
item subject to the Regulations that has been or will be exported from 
the United States. For purposes of this paragraph, servicing means 
installation, maintenance, repair, modification or testing.
    Fourth, that, after notice and opportunity for comment as provided 
in Section 766.23 of the Regulations, any person, firm, corporation, or 
business organization related to Rahimzadeh by affiliation, ownership, 
control, or position of responsibility in the conduct of trade or 
related services may also be made subject to the provisions of this 
Order.
    Fifth, that the Charging Letter, the Settlement Agreement, and this 
Order shall be made available to the public.
    Sixth, that this Order shall be served on the Denied Person and on 
BIS, and shall be published in the Federal Register.
    This Order, which constitutes the final agency action in this 
matter, is effective immediately.

    Issued this 25th day of March 2010.
David W. Mills,
Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 2010-7437 Filed 4-1-10; 8:45 am]
BILLING CODE 3510-DT-M