Last week the Office of Foreign Assets Control (“OFAC”) released its monthly summary of penalties imposed by the agency.

In one case the agency levied a fine of $31,336 and in another the fine was $2800. One of those two cases involved violation of the Cuban Assets Control Regulations and the other involved violation of the Weapons of Mass Destruction Control Regulations. Guess which one got the bigger fine.

If you guessed the Cuba case, you win the cigar (Honduran, of course). Acme Furniture got the $31,336 fine for shipping furniture from China to Cuba. Hecny Transportation got the smaller fine for dealing with goods produced by a foreign person designated under the WMD Control Regulations.

Three of the other cases reported by OFAC involved a perennial favorite of the OFAC enforcement staff: people who buy Cuban cigars over the Internet. One particularly dangerous cigar purchaser was fined $2304, only a few dollars less than it cost Hecny to deal with a designated purveyor of WMD. To paraphrase Kipling, a bomb is only a bomb, but a good cigar is a smoke!

A while back we reported on a fine that OFAC imposed on the Alliance of Baptists, a church group which obtained a license for its member churches to travel in Cuba. Some of the member churches had apparently engaged in tourist activities such as visiting museums and other tourist attractions. Licenses for missionary activity in Cuba require that the missionaries devote their entire time in Cuba to a religious program and forbid groups from engaging in any tourist activities while in Cuba.

According to this article from Associated Baptist Press, OFAC withdrew the penalty on May 17, finding that none of the trips in question involved any improper tourist activities. This finding was allegedly premised on a submission that the group made to OFAC which can be found here. That submission, however, seems to be a fairly direct confession that the groups did, in fact, devote time to tourism, making OFAC’s actions here a bit hard to understand without assuming that the decision was based more on politics than policy.

The problem for the Alliance of Baptists started when it submitted to OFAC in June 2005 an itinerary for a March 2005 trip to Cuba. After analyzing that itinerary, OFAC suspended the Alliance’s travel license and stated the following in the Notice of License Suspension:

The itinerary included approximately four hours of religious activities each day, on average. The rest of the time was filled with walking and driving tours, sightseeing and beach time in Varadero, and visits to farms, museums and craft markets.

The Alliance response to OFAC’s subsequent decision to fine the Alliance $34,000 included a number of affidavits from people who were on the trips to Cuba using the Alliance license. In each instance, the affidavits admitted tourist activity occurred but tried to put a religious gloss on those activities.

An affidavit from a member of the Baptist Church of the Covenant in Birmingham, Alabama, admitted that its group took a driving tour of Havana, claiming to be to sick to engage in the religious activities that had been scheduled for the group. The affidavit of the pastor of the First Baptist Church of Washington, D.C., admitted that the group toured Old Havana but claimed that this was part of its “partnership” with a Cuban church. A member of another church admitted in his affidavit that his group, among other things, engaged in a nature hike in a national park, took a tour of the city of Santa Clara, attended the ceremonial closing of a harbor, and spent a morning touring Old Havana. These were all claimed to be religious activities because they were done together with members of Cuban churches.

Regular readers know that I think that OFAC has better things to do than to pore over the itineraries of Baptists in Cuba to make sure that they don’t have any fun while there. But, 31 C.F.R. 555.516 explicitly requires that licensed religious travelers be engaged “in a full-time program of religious activities” while in Cuba. Normal tourist activities can’t be turned into religious activities simply by enlisting a Cuban church member as a tour guide. Without some clarification from OFAC, it certainly looks like its about-face on its proposed penalty had little to do with the merits of the case.

Michael Moore probably didn’t get a Christmas card from the Bushes this year — or any year for that matter. But he did recently get a nice letter from OFAC telling him we was under investigation.

It seems that Moore made a trip to Cuba in March 2007 while filming his new film “Sicko” and it seems that he didn’t have a license. So why didn’t OFAC simply fire off a charging letter and tell Moore to open up his checkbook? Because, as the OFAC letter states,

OFAC has information indicating that you claimed to qualify under the provision for general license [sic] for full-time journalists

That evidence is probably an April 15 New York Post article where a producer for the film told the Post reporter that the film crew traveled to Cuba pursuant to a “”general license that allows for journalistic endeavors there.”

The OFAC letter demands that, if Moore is claiming the general license for journalists, Moore should:

provide evidence [he is] regularly employed as a journalist by a news-reporting organization.

The general license for journalists to travel to Cuba is set forth in 31 C.F.R. § 515.563 and it covers travel to Cuba by individuals “regularly employed as a journalist by a news-reporting organization.”

Now Moore’s occupation and employment are not exactly state secrets and should be well known even to folks chained to their desks in the Cuba section at OFAC. He’s a documentary film-maker. Documentary film-makers are journalists. He’s employed by his production company Dog Eat Dog which makes documentaries. Companies that make documentaries are news-reporting organizations plain and simple.

This is the first instance I am aware of where OFAC has challenged the bona fides of a documentary film-maker who has traveled to Cuba on the general license to make a documentary film. Charlize Theron traveled to Cuba, apparently on a general license, to make her documentary on Cuban hip-hop and she hasn’t been asked to cough up her journalistic credentials. Perhaps that was because her documentary criticized Castro’s pervasive censorship of the arts in Cuba.

Moore may be controversial. People might not agree with what he says and think he’s a big fat liar. But that doesn’t mean that he isn’t a journalist or that his documentary film company isn’t a news-gathering organization.

During an investigation of Col. William Steele for alleged improprieties in his oversight of the prison in Baghdad where high value detainees are kept, an interesting tidbit was revealed. Witnesses testified that Col. Steele provided Saddam Hussein with Cuban cigars. Hair dye too, but it’s the Cohibas that are causing the ruckus.

Army Brig. Gen. Kevin McBride of the 43rd Military Police Brigade of Rhode Island, who oversaw Iraq’s detention facilities while Steele was running Camp Cropper, said purchases of cigars for Saddam had been approved before either he or Steele assumed their commands.

OFAC mavens, of course, will understand that the folks over at OFAC are going to bust a gut over this. They are probably drafting a charging letter right now and trying to decide which military officials will be the happy recipients. Or maybe not.

The problem, you see, is that it’s not just illegal to import Cuban cigars. It’s illegal to buy them anywhere in the world even if you have no plans to bring them back to the United States. The “Cuban Cigar Update” posted on the OFAC website is succinct on this point:

The question is often asked whether United States citizens or permanent resident aliens of the United States may legally purchase Cuban origin goods, including tobacco and alcohol products, in a third country for personal use outside the United States. The answer is no.

Remember this the next time you’re in Europe and someone tries to slip you a Cohiba Cigar or a shot of Havana Club Rum.

(Via Export Boy.)