US lifts sanctions on Ofer brothers' firm in Iran sale

The United States is lifting sanctions it slapped on an Israeli holding company accused of selling an oil tanker to Iran, Israel's mortal enemy and the object of tightening US and international sanctions over its disputed nuclear program.

The State Department issued a brief notice Tuesday, saying it is clarifying culpability for the 2010 sale.

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The surprise US move Tuesday followed months of lobbying on behalf of two Israeli brothers who were among that nation's richest men. The billionaire Ofer brothers claimed that the $8.5 million deal, small for their massive conglomerate, was conducted unwittingly with an Iranian shell company. Nonetheless, the company said it was embarrassed.

"This action clears our name," a statement from the Ofer firm said.

The State Department lifted penalties on the "Ofer Brothers Group," a corporate name applied to the brothers' vast holding company. The new notice adds sanctions against two other entities directly involved in the sale of the tanker Raffles Park, and leaves in place sanctions against an Ofer subsidiary based in Singapore. In all cases the State Department said the entities should have known who was actually buying the ship.

The Ofer conglomerate indirectly owns all three entities, but the family business itself is no longer listed as responsible for the sale.

Yuli and Sammy Ofer: Sanction lifting came too late (Photo: Avigail Uzi)

The original sanctions applied in May had banned the Ofer brothers and their Singapore subsidiary from obtaining US export licenses and American bank loans topping $10 million. The sanctions cast a pall on Ofer businesses around the world, in part because of confusion over the corporate name applied by the State Department. The Ofer family says there is no such entity.

The sanctions also caused an outcry in Israel, whose national security policy is heavily organized around Iran's declared intention to extinguish the Jewish state. The sanctions drew calls in Israel for an investigation when media reports suggested that the Ofers' ties with Iran might have been authorized by the Israeli government or linked in some way to Israeli intelligence operations.

Prime Minister Benjamin Netanyahu's office denied that the government had authorized the company's dealings.

The revised State Department notice means no Israeli firm is now held directly responsible for the sale.

The brothers did not live to see the news. Sammy Ofer died in June at 89, Yuli Ofer died last week at 87.

The two Romanian émigrés built a sprawling business empire that included holdings in international shipping, real estate, chemicals and banking. They divided up their assets in recent years, but media have reported their joint worth ranged from $4 billion to $10 billion.

The US sanctions came at an embarrassing time. Netanyahu was in the US, winding up a strained visit to Washington in which he publicly differed with President Barack Obama over Mideast peacemaking. Throughout his visit, Netanyahu repeatedly voiced concerns about the Iranian nuclear program.

The Obama administration slapped sanctions on six other foreign companies at the same time in May, including Venezuela's state-owned oil company, claiming its dealings help fund Iran's nuclear program.

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