The US Office of Foreign Assets Control (OFAC) has settled with Houston-based freight forwarder Fracht FWO Inc. for USD1.6 million for the charter of a B747-300M operated by Venezuela's Emtrasur Cargo (Caracas Simón Bolivar) in 2022. The ill-fated transport of automotive parts from Mexico to Argentina led to the seizure of the aircraft and its eventual scrapping by the United States government in 2024.

The government said that the company's violations of US sanctions against Venezuela and Iran were "egregious", though not wilful. Fracht "demonstrated reckless disregard for US sanctions requirements by foregoing its internal compliance processes and executing a contract using a blocked aircraft from Venezuela without conducting due diligence and failing to respond appropriately to significant red flags," the OFAC said.

The investigation showed that at least two vice presidents of Fracht knew that the USD935,000 payment would make its way to Emtrasur Cargo, a subsidiary of Conviasa, although they apparently had no knowledge that the aircraft was also involved in sanctions on Iran's Mahan Air.

The settlement allows the freight to be forwarded to avoid potential civil liability and is lower than the maximum permissible fine of USD2.1 million.

Fracht was contracted by a "major manufacturer" to arrange an urgent shipment of parts from Mexico to Argentina in May 2022. It then chartered Emtrasur Cargo's only aircraft, B747-300M YV3531 (msn 23413), for an initial fee of USD885,000 to a broker that helped arrange the charter, of which USD825,000 went to the Venezuelan airline. Later, Fracht paid an additional USD110,000 directly to Emtrasur as a delay fee caused by the necessary reconfiguration of the payload in Mexico.

While the executives were aware that the aircraft was operated by Emtrasur and that the company was a subsidiary of Conviasa, OFAC found that the forwarder never conducted a sanctions check or due diligence.

The aircraft was previously operated by Mahan Air, which is designated by the US as an affiliate of the Islamic Revolutionary Guards Corps-Quds Force, and at the time of the charter it was crewed by Iranian nationals. OFAC also alleged that "following the aircraft’s transfer to Emtrasur, Mahan Air continued to coordinate its use, providing operations training and maintenance services." None of that was known to Fracht, however.

The B747 was seized after arrival in Argentina and became the subject of a lengthy legal and political dispute that started under the previous administration of President Alberto Fernández, which had good relationships with Venezuela, and ended under the current administration of pro-US President Javier Milei. The Iranian crew, detained in Argentina for months, recently sued the Argentinian and US governments in a Tehran court.