CubaHeadlines

U.S. Slaps Over $600,000 Fine on Company for Shipments to Cuba

Thursday, July 3, 2025 by Robert Castillo

U.S. Slaps Over $600,000 Fine on Company for Shipments to Cuba
Facade of the U.S. Department of the Treasury building - Image by © Facebook/The U.S. Department of the Treasury

The United States government has levied a fine of $608,825 against Key Holding, LLC, a global logistics company based in Delaware, for breaching embargo sanctions by facilitating 36 cargo shipments to Cuba between January 2022 and July 2023. According to an official statement from the Office of Foreign Assets Control (OFAC), the violation occurred through its Colombian subsidiary, Key Logistics Colombia S.A.S., which was acquired by the U.S. parent company in December 2021.

During this timeframe, the subsidiary managed shipments valued at over $3 million from suppliers in Colombia, Spain, China, and Panama, directed to various consignees in Cuba. Out of the 36 shipments, 33 contained food items, which, if properly processed, could have been exempted but were not authorized by OFAC. The remaining three shipments included machinery components for oil wells, towels, and electric forage shredders, some of which were managed through Comercial Cupet S.A., a state-owned Cuban entity specializing in energy sector imports.

Key Holding claimed it was unaware of these transactions until January 2024 while preparing to sell the company to another U.S. firm. Both the parent company and its subsidiary lacked a sanctions compliance program, a critical oversight that allowed these operations to proceed unchecked. OFAC acknowledged the company's cooperation in the investigation, its self-disclosure, and the adoption of corrective actions, including the implementation of internal controls, mandatory sanctions training, and automated shipment monitoring tools.

However, OFAC also identified aggravating factors, such as the lack of due diligence, the negative impact on U.S. sanctions policy on Cuba, and the fact that staff in Colombia were indeed aware of the shipment destinations. This case serves as a stark warning to other companies: even businesses operating outside the U.S. can violate regulations if they are under U.S. control.

The U.S. Department of the Treasury emphasizes the importance of scrutinizing contracts, destinations, certificates of origin, and shipping documents, particularly when integrating foreign subsidiaries.

Understanding U.S. Sanctions and Compliance

What led to the fine imposed on Key Holding, LLC?

Key Holding, LLC was fined for facilitating 36 cargo shipments to Cuba in violation of U.S. embargo sanctions, through its Colombian subsidiary.

Why were the food shipments not exempted?

Although the shipments contained food items that could have been exempted under certain conditions, they were not authorized by OFAC due to improper processing.

What corrective actions did Key Holding implement?

Key Holding adopted several corrective measures, including implementing internal controls, mandating sanctions training, and utilizing automated shipment monitoring tools.

© CubaHeadlines 2025