AmEx Mistakenly Issued Card to German With Ties to Nuclear-Weapons Black Market, Treasury Says

By Dylan Tokar 

An American Express Co. subsidiary mistakenly issued a prepaid card to a German engineer with alleged ties to a black market in nuclear-weapons technology, the Treasury said Thursday.

The subsidiary, American Express Travel Related Services Co., provided the card to Gerhard Wisser, whom U.S. authorities have accused of playing a role in a group run by Abdul Qadeer Khan, sometimes referred to as the father Pakistan's nuclear program. AmEx wasn't fined for the violation.

The subsidiary issued Mr. Wisser the prepaid card and processed 41 transactions totaling $35,246.82 in violation of U.S. sanctions, the Treasury's Office of Foreign Assets Control said.

The alleged violations were the result of human error as well as defects in AmEx's sanctions-screening system, the agency said. The company voluntarily disclosed the violation to authorities, OFAC said.

A representative for AmEx, which is based in New York, declined to comment on OFAC's findings.

Mr. Wisser was placed under U.S. sanctions in 2009 along with a number of other individuals and entities that U.S. authorities said were involved in a nuclear-weapons network run by Dr. Khan.

In 2015, Mr. Wisser applied for the card at a non-U.S. bank. An AmEx compliance screening system initially declined the bank's application request, but additional approval attempts caused the system to time out and the application was automatically approved, OFAC said.

Still, the application was flagged for review, but the AmEx compliance analyst who handled it determined incorrectly that Mr. Wisser wasn't a sanctioned individual, the agency said.

In determining its enforcement action, the Treasury concluded that there was no willful or reckless behavior on AmEx's part, that the company had cooperated with OFAC's investigation and that it had taken steps to prevent any further violations.

The case highlighted the importance of ensuring that automated compliance controls not be overridden without appropriate review, OFAC said.

Write to Dylan Tokar at [e-mail]

(END) Dow Jones Newswires

April 30, 2020 18:29 ET (22:29 GMT)

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