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Ubiquiti Networks

Ubiquiti Networks

Industry: 
Technology, Manufacturing
Symbol: 
NASDAQ: UBNT
States: 
CA
Country: 
USA
Contact Information: 
Sources: 

"Ubiquiti Networks Inc., a maker of wireless hardware and video surveillance equipment, agreed to pay a $504,225 penalty to settle apparent U.S. sanctions violations for allowing its hardware to be sold in Iran, according to a company filing. The case illustrates how small companies can run afoul of compliance rules as they seek to expand in new markets. Ubiquiti “demonstrated reckless disregard for U.S. sanction” law, and allowed its wireless equipment to be exported into Iran through distributors located in the United Arab Emirates and Greece, according to a release from the U.S. Office of Foreign Assets Control. The firm had no compliance program at the time, according to the release. And even after Ubiquiti learned that the transactions broke U.S. law, the company allowed them to continue for another year, until February 2011, OFAC said. The company said, in a filing released Thursday, that until early 2010 it didn’t prohibit its distributors from selling its products to Iran. After it learned of the potential violations, the company said that it failed to immediately ‘amend all its distribution agreements and to implement more robust compliance controls.’ Ubiquiti first made the issue of possible violations public in 2011, as it prepared for its initial public offering. As part of its IPO prospectus, the company said it hadn’t been sufficiently familiar with export control laws because of its small size and the ‘inexperience of our management team in these matters,’ Reuters reported. As of June 2013, the company had just 111 employees stretched across four countries, according to filiings. The company recorded $320.8 million in revenue for its fiscal year 2013 that ended June. Ubiquiti declined requests for interview through a spokeswoman. In a statement, the spokeswoman said: ‘Since 2011, we have put measures in place designed to prevent this type of issue from happening again.’” (Wall Street Journal, “Ubiquiti Networks Settles Over U.S. Sanctions Violations,” 3/6/14)

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“Wireless equipment maker Ubiquiti Networks Inc broke a two-month drought in the U.S. IPO market on Thursday pricing shares in its initial public offering at the low end of the expected range… Ubiquiti, whose shares will trade on Nasdaq under the stock symbol UBNT.O, makes wireless networking and video surveillance equipment. It said in its prospectus that certain of its products were sold to Iran, Cuba, Syria, the Sudan and North Korea and that some of its encryption components were sold without the appropriate export authorization… A review of Ubiquiti's sales to Iran by the Department of Commerce's Office of Export Enforcement earlier this year resulted in a warning letter, but no criminal or administrative prosecution or other penalties -- but Ubiquiti remains under review by the Department of the Treasury's Office of Foreign Assets Control.” (Reuters, "Ubiquiti breaks US IPO drought amid Iran controversy," 10/13/2011)

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"UBNT believes its products have been sold into Iran by third parties." (Seeking Alpha, "IPO Preview: Ubiquiti Networks," 10/7/2011)