Cook Composites and Polymers Co. has agreed to pay a $6,000
fine to settle charges that it violated Commerce Department regulations
aimed at countering the Arab boycott of Israel.
The department's Bureau of Industry and Security had charged that, in response
to a request from a customer in Bahrain, Cook had furnished information
stating that the goods being shipped were not of Israeli origin and did
not contain Israeli materials.
The bureau also charged that Cook had failed to report its receipt of the
Cook, of North Kansas City, neither admitted nor denied the allegations,
but agreed to pay the $6,000 civil penalty.
The anti-boycott provisions bar U.S. companies from providing information
about their business relationships with Israel. They also require that
receipt of boycott requests be reported to the Bureau of Industry and Security,
formerly known as the Bureau of Export Administration.
Cook's chief executive, Charles Bennett, was in Paris this week and unavailable
for comment. A spokeswoman for the company, Rita Durocher, said the fine
marked the first time Cook has had a run-in with a federal agency.
"If you go back and look at our record, we've been flawless with other
government agencies," she said.
Cook makes polyester gels and other coating resins. It operates plants
throughout North America.
The settlement with the Commerce Department came after the Bush administration
in November warned U.S. companies not to heed calls to boycott Israeli
goods and services. The warning followed a call by the 22-member Arab League
to reactivate its decades-long boycott of Israel.
In a statement released at the time by the department, Commerce Undersecretary
for Industry and Security Kenneth Juster reminded American companies that
the "U.S. government is strongly opposed to restrictive trade practices
or boycotts targeted against Israel."
Knowing violators of the anti-boycott provisions face fines of up to $50,000,
or five times the value of the exports at issue, and possible imprisonment.
Offenders can also be denied export privileges.
The Bureau of Industry and Security says it has imposed more than $26 million
in fines for violations of the provisions.
More than a decade ago, the Commerce Department sent compliance officers
to Kansas City to check out tips that Marion Merrell Dow Inc. and Marley
Cooling Tower Co. may have cooperated with the Arab boycott. Nothing came
of the investigation, and no penalties were imposed.
In Cook's case, the Bureau of Industry and Security charged that Cook failed
to report a letter of credit it received on Dec. 1, 1997, from ABN AMRO
Bank in Manama, Bahrain. The letter asked it to confirm that the goods
being shipped "are not of Israeli origin nor do they contain any Israeli"material.
The bureau also charged that on Jan. 20, 1998, Cook, through its freight
forwarder, provided a U.S. bank with a copy of a commercial invoice confirming
that the goods were not of Israeli origin and did not contain Israeli material.
Cook, with 558 employees overall and 120 employees locally, is one of North
Kansas City's biggest employers. The company bills itself as the No. 1
producer of gel coats in the world and, together with affiliated companies,
the No. 2 producer of resins.
Since 1990, Cook has had a joint venture relationship with the chemicals
division of TotalFinaElf, a multibillion-dollar petrochemicals giant based
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