Airbnb Payments, Inc. settles potential OFAC liability
OFAC has published an enforcement release announcing that Airbnb Payments, Inc., a registered money services business incorporated in 2013 under the laws of the State of Delaware and headquartered in San Francisco, California, and a wholly owned subsidiary of Airbnb, Inc., has agreed to remit $91,172.29 to settle its potential civil liability for apparent violations of sanctions against Cuba administered by the Office of Foreign Assets Control (OFAC). This activity included payments related to guests traveling for reasons outside of OFAC’s authorized categories as well as a failure to keep certain required records associated with Cuba-related transactions. The settlement amount reflects OFAC’s determination that Airbnb Payments’ apparent violations were voluntarily self-disclosed and were non-egregious.
Pursuant to communications with OFAC, Airbnb Payments conducted a forensic review based on an approved and statistically significant sampling of “Stays” (i.e., traveler lodging provided by Airbnb, Inc. “Hosts”) and “Experiences” (i.e., traveler activities provided by Airbnb, Inc. Hosts) transactions involving Cuba. By extrapolating the results of that sampling review to the total transactions processed by Airbnb Payments between September 28, 2015 and March 1, 2020, it was determined that Airbnb Payments processed payments related to 3,464 extrapolated Stays transactions in Cuba by Airbnb, Inc. “Guests” traveling for reasons outside of OFAC’s 12 authorized categories. The extrapolated average transaction amount processed for each such Stay was $139.52. Airbnb Payments also processed payments related to 3,076 extrapolated Experiences transactions where Airbnb Payments failed to keep records in accordance with the OFAC’s regulations. The extrapolated average transaction amount processed for each such Experience was $78.40. Airbnb Payments also processed payments related to 44 confirmed transactions involving non-U.S. persons engaging in Cuba travel transactions on Airbnb, Inc.’s platform prior to OFAC issuing a specific license to Airbnb, Inc. to engage in such conduct. The average transaction amount processed for those transactions was $111.09. As a result, Airbnb Payments processed payments on behalf of customers on Airbnb, Inc.’s platform in apparent violation of the Cuban Assets Control Regulations (CACR), 31 C.F.R. § 515.201 and § 515.572(b) (the “Apparent Violations”).
The statutory maximum civil monetary penalty applicable in this matter is $600,601,408. However, OFAC determined that Airbnb Payments voluntarily self-disclosed the Apparent Violations and the Apparent Violations constitute a non-egregious case. Accordingly, under OFAC’s Economic Sanctions Enforcement Guidelines (“Enforcement Guidelines”), the base civil monetary penalty amount applicable in this matter equals the sum of one-half of the transaction value for each apparent violation, which is $364,689.
The settlement amount of $91,172.29 reflects OFAC’s consideration of the General Factors under the Enforcement Guidelines that mitigated the penalty.