US: Ofer Holdings failed to conduct due diligence

The State Department insists that Ofer Holdings is responsible for the sale of an oil tanker to Iran, and rejects claims of a "misunderstanding."

The US State Department insists that Ofer Holdings Group is responsible for the sale of an oil tanker to Iran, and rejects the company's claims of a "misunderstanding".

In response to a question at a press briefing yesterday, State Department acting deputy spokesman Mark Toner said, "I’m limited to how much detail I can get about these sanctionable acts, but again, we did considerable due diligence in checking out these claims. And what we found is that Ofer Holdings Group is the parent of a company called Tanker Pacific, and that’s the company that actually sold this tanker to the Iranians. And the company and its subsidiary, frankly, has failed to do proper due diligence and to prevent this transaction. So they’re responsible - I guess my point is that they’d be responsible for the conduct of their subsidiary."

Ofer Holdings claims that the affair is a misunderstanding, and that they sold the tanker Raffles Park to a Dubai company, not to Republic Iran Shipping Lines (IRISL) as claimed by the State Department. The State Department has imposed sanctions on Ofer Holdings and six other companies under an amendment to the Iran Sanctions Act.

In Israel, MK Sheli Yacimovitch (Labor) said, "The sale of a tanker to Iran crosses the dangerous border and testifies the growing greed that trumps the country's security and the importance of diplomatic, commercial and security relations with the US."

She added, "The company's response that it has donated tens of millions of shekels to various organizations, including the IDF, is unpreedented cynicism, which shows that charity (which in any case mostly comes at the expense of investors in companies they control) is merely intended to create a wall of immunity against criticism and an open ticket to scandalous moral and business conduct."

Movement for Quality Government in Israel has asked Attorney General Yehuda Weinstein to open an investigation into the case. "This is a serious and troublesome case in which some of Israel's strongest and most prominent businessmen, allegedly evaded sanctions imposed on Iran, and through companies they control, helped the nuclear industry of a hostile country that has openly declared its wish to destroy the State of Israel."

Published by Globes [online], Israel business news - - on May 26, 2011

© Copyright of Globes Publisher Itonut (1983) Ltd. 2011

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