One-two punch against Expedia

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On June 18, a Florida family sued trivago, a German travel services company, for “unlawful trafficking” in a hotel they owned before the Cuban revolution.
The family of Antonio Mata y Alvarez says trivago, which is spelled with a lowercase t, benefited from the Hotel San Carlos in Cienfuegos and “scores of properties like it.”
The company provided “booking services for those properties online” and received “compensation in the form of commissions, fees, and other remuneration for those services.”
The lawsuit states:

The Matas now sue to recover for defendant’s unlawful trafficking in their property and for just compensation for themselves and a class of similarly situated persons.

On May 20, the Mata heirs filed a similar lawsuit against Cuban tourism companies. See “Class-action lawsuit targets Cuban tourism.”
trivago is a subsidiary of Expedia, Inc., based in Bellvue, Washington. On June 13, the Treasury Department announced that it had settled with Expedia over potential violations of the Cuban Assets Control Regulations.
Expedia paid $325,406 rather than face a penalty of more than a half-million dollars. The Treasury Department’s Office of Foreign Asset Control stated:

Specifically, between on or about April 22, 2011 and on or about October 16, 2014, 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.

A quick aside: The timing strikes me as suspicious. Why did Treasury wait almost five years to go after Expedia?
I wonder if there is any coordination between OFAC investigators and the private lawyers who carry out civil lawsuits such as this one against trivago. Do government investigators somehow collude with lawyers who are pursuing property-related claims?
The Trump administration’s campaign against Cuba opened the door for the property claims. Did politics also lead to OFAC’s case against Expedia?
The Treasury Department’s announcement about Expedia doesn’t answer that question. It states:

The apparent violations occurred because certain Expedia foreign subsidiaries lacked an understanding of and familiarity with U.S. economic sanctions laws and Expedia employees overlooked particular aspects of Expedia’s business that presented risks of noncompliance with sanctions. Specifically, electronically booked travel resulted from failures or gaps in Expedia’s technical implementations and other measures to avoid such apparent violations. 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. 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.
OFAC determined that Expedia voluntarily self-disclosed the apparent violations to OFAC, and that the apparent violations occurred prior to agency notice. Under the Cuba Penalty Schedule, 68 Fed. Reg. 4429 (Jan. 29, 2003), the base penalty for the apparent violations is $556,250.
The settlement amount reflects OFAC’s consideration of the following facts and circumstances, pursuant to the General Factors under OFAC’s Economic Sanctions Enforcement Guidelines, 31 C.F.R. part 501, app. A. OFAC considered the following to be aggravating factors:

  1. Expedia failed to exercise a minimal degree of caution or care in avoiding the conduct that led to the apparent violations. Moreover, based on the number of apparent violations, the length of time over which the apparent violations occurred, and the number of Expedia entities involved in the apparent violations, the apparent violations appear to have resulted from a pattern or practice of conduct.
  2. The apparent violations harmed the sanctions program objectives of the CACR, based on the number of apparent violations and the length of time over which the apparent violations occurred.
  3. Expedia is a sophisticated international travel service provider, providing global travel services to customers located worldwide.

OFAC considered the following to be mitigating factors:

  1. Expedia has not received a penalty notice or Finding of Violation from OFAC in the five years preceding the earliest transaction giving rise to the apparent violations.
  2. After discovering the apparent violations, 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.
  3. Expedia cooperated with OFAC’s investigation by submitting data analytics associated with the apparent violations, responding to OFAC’s requests for additional information, and entering to multiple tolling agreements.
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