Exxon Mobil Corp. must pay a $2 million fine for showing "reckless disregard" for US sanctions on Russian Federation while Secretary of State Rex Tillerson was the oil giant's CEO, the Treasury Department said Thursday.
Exxon violated USA sanctions on Russia during May 2014 when it signed eight documents relating to oil and gas projects in Russia with Igor Sechin, the president of Russian state-oil firm Rosneft, Treasury said in an enforcement notice posted to its website.
The violations occurred in May of that year when the now Secretary of State Rex Tillerson was CEO of ExxonMobil, according to a filing by the Treasury's Office of Foreign Assets Control (OFAC).
The Treasury said Exxon displayed "reckless disregard" for the sanction order, and senior company officials knew of Sechin's sanctioned status when they completed the business deal in 2014.
Exxon Mobil, at the time of the alleged violation, was headed by Rex Tillerson, who is now the USA secretary of state. "OFAC's action is fundamentally unfair".
In a statement, Exxon countered that it had done nothing wrong and complained that the fine was "fundamentally unfair".
No White House or Treasury statements asserted "an exception or carve-out for the professional conduct of designated or blocked persons, nor did any materials suggest that USA persons could continue to conduct or engage in business with such individuals", OFAC said.
The sanctions, signed by former President Barack Obama in an executive order, came as Russian troops had been deployed in the Ukrainian region of Crimea, further escalating the situation between the two countries.
The documents, which Treasury said Exxon Mobil failed to "voluntarily self-disclose", were related to oil and gas projects in Russian Federation.
Tillerson, whom Putin personally awarded Russia's Order of Friendship in 2013, reportedly argued at the time that he was not in favor of sanctions because he believed them to be ineffective, which is definitely the case if you choose to ignore them.
Sechin signed the documents on behalf of Rosneft, Jeffers said. A few days later, Tillerson was unambiguous about Exxon's opposition to the sanctions during his company's annual meeting.
Tillerson left ExxonMobil to become secretary of state after 10 years at the helm of the global energy power.
With rising tensions between Russian Federation and Ukraine in 2014, western powers, including the US, imposed economic and technological sanctions against Moscow.
The State Department declined to comment, referring questions to Exxon.