Ebara to Pay a Fine of 6.3 Million USD

28.09.2004

The U.S. subsidiary of the Ebara Corporation (Japan) has agreed to pay a $6.3 million criminal fine and $121,000 civil fine for illegally shipping of pumps to Iran and trying to shield the deal from regulators.

According to the U.S. Commerce Department, the Company founder Everett Hylton, who resigned as chief executive a year ago, pleaded guilty to a separate charge of conspiracy to make false statements to investigators. He agreed to pay a $10,000 criminal fine and a $99,000 civil fine.

It's illegal for U.S. companies to sell industrial products to Iran, a nation designated as a state sponsor of terrorism by the State Department.

Ebara has delivered four high-technology pumps valued at $750,000 to Iran, but according to the Justice Department the probe prevented three more valued at $1.2 million from being shipped. An investigation found the cryogenic transfer pumps were resold through two French companies, Cryostar and Technip, for use in a petrochemical plant in Iran through a complex scheme arranged by Ebara. An investigation into the French companies' role in the case is continuing and could lead to U.S. economic sanctions against them, The Washington Times reported.

The pumps have applications for both liquid natural gas and cooling nuclear power plants, and Commerce Department officials had feared they could be used for nuclear projects. "It does not look like they could be used in that manner, but similar pumps could be used in that manner," Julie Myers, Commerce Department assistant secretary for export enforcement, said. "There is concern that if similar pumps (can be used), you could export the know-how." But Ebara president Martin Perlmutter disagreed, saying the pumps "have absolutely no application in nuclear power plants."

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