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U.S. government fines companies over Cuba-related travel violations

Three American companies agreed to pay more than a half million dollars in fines

HAVANA – Three U.S.-based companies are paying the U.S. Treasury Department more than a half million dollars for providing "Cuba-related travel services" that violated regulations, authorities announced Thursday.

Washington state-based Expedia agreed to pay $325,406 to avoid potential civil liability. Between April 2011 and October 2014, the Treasury Department said Expedia "dealt in property or interests in property of Cuba or Cuban nationals by assisting 2,221 persons — some of whom were Cuban nationals — with travel or travel-related services for travel within Cuba or between Cuba and locations outside the United States."

The government said the violations occurred because Expedia foreign subsidiaries didn’t understand and were not familiar with U.S. economic sanctions law and its employees overlooked particular risks associated with sanctions.

"With respect to at least one foreign subsidiary, Expedia failed to inform the subsidiary until approximately 15 months after Expedia acquired the subsidiary that it was subject to U.S. jurisdiction and law," the Treasury release said. "Expedia was slow to integrate the subsidiary into the Expedia corporate family, including with respect to compliance with U.S. sanctions, and the subsidiary continued operating independently during the integration period."

After discovering the violations, the Treasury Department added Expedia "implemented significant remedial measures to strengthen its U.S. economic sanctions compliance program throughout the Expedia corporate family, including domestic and foreign direct and indirect subsidiaries."

Florida-based Hotelbeds USA, a company with headquarters in Spain, has agreed to pay $222,705 for providing Cuba-related travel services to 703 non-U.S. persons between December 2011 and June 2014.

In the release, the U.S. Treasury Department alleges the company “knowingly sold hotel accommodations and gave its clients specific instructions to direct their payments for the Cuba-related transactions to an account in Spain, from which Hotelbeds USA was subsequently reimbursed.”

The U.S. government further alleges company employees and supervisors may have known about the violations and they were not voluntarily self-disclosed.

The third company, Cubasphere, agreed to pay $40,320 for Cuba travel-related violations in which they allegedly helped 104 people on four separate trips to and within Cuba between 2013 and 2014.

The company, which the government described as a "relatively small company with few employees" helped travelers with Cuban visas and cover letters from U.S. religious organizations, but the government alleges itineraries did not match and they "focused primarily on sightseeing and tourism activities rather than humanitarian or religious activities."

The government made the company aware of violations, but they continued to "organize, plan and carry out unauthorized Cuba travel-related transactions for more than a year."

Perhaps the most damning accusation against Cubasphere is that the company took steps to urge clients to hide their travel and unauthorized activities in Cuba.

In writing, the company told customers they should minimize their interactions with U.S. government officials upon their return to the United States, have no receip and give false statements if asked about their activities in Cuba, the Treasury Department released said.

Local 10 News reached out to Expedia for comment; the two other companies did not have contact information.


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