British American Tobacco will pay over $600 million to settle claims that it violated US sanctions on North Korea. The US Justice Department accused the company and its subsidiary of selling tobacco products to North Korea through a corporate cutout in Singapore. The investigations by the US Department of Justice and Treasury Department’s Office of Foreign Assets Control concerned BAT’s business activities relating to North Korea between 2007 and 2017. The United Nations imposed sanctions on North Korea after Pyongyang staged a nuclear test in 2006, with the United States imposing even stronger restrictions on trade with the country.
Assistant Attorney General Matthew Olsen stated that this was the single largest North Korean sanctions penalty in the history of the Department of Justice. The Justice Department put the figure at $629 million, while BAT said it was $635 million. However, the company had already set aside $540 million to cover the settlement, and it claimed that it would have no impact on its financial guidance to investors for 2023.
BAT’s chief executive Jack Bowles stated that the company deeply regretted the misconduct arising from historical business activities that led to these settlements and acknowledged that they fell short of the highest standards that were rightly expected of them. He further said that the company ended all such activities in 2017.
