Airbnb in talks with OFAC regarding potential sanctions violations

“Since July 2019, we conducted an internal review and have been holding related discussions with OFAC regarding certain user activity on our platform that may have been inconsistent with our policies and the requirements of U.S. sanctions laws,” Airbnb said in an initial public filing (IPO) document filed with the Securities and Exchange Commission on Monday.

The scope of that internal review covered user activity in certain countries and territories that were or are the target of U.S. sanctions laws; certain other issues concerning potential noncompliance with OFAC’s sanctions program focusing on Airbnb’s business in Cuba; and its compliance with restrictions on transactions with specially designated nationals, Airbnb said in the IPO document.

“In July 2020, OFAC issued to us a cautionary letter and no administrative penalty with respect to certain aspects of that review concerning the Crimea region of Ukraine,” Airbnb said. In October 2020, OFAC further issued to Airbnb “cautionary letters and a no action letter, and no administrative penalties, with respect to the disclosed matters involving specially designated nationals,” according to the company filing.

“OFAC’s review of our voluntary self-disclosure regarding Cuba is ongoing and we remain in close contact with OFAC,” Airbnb said. “Depending upon OFAC’s assessment of the Cuba review, we could be subject to potentially significant monetary civil penalties and litigation, and our brand and reputation could be materially adversely affected.”

Airbnb noted it maintains policies and procedures to implement the “high level of internal controls” required “to track and verify transactions and otherwise to comply with these regulations.” The company said it also periodically assesses and updates these controls “to the extent we identify compliance gaps.”

Airbnb said in the IPO document it has also reported to the Office of Financial Sanctions Implementation of Her Majesty’s Treasury in the United Kingdom on dealings with persons subject to EU/UK sanctions.