Software

"Software company SAP SE admitted it provided millions of dollars in software to Iran in violation of U.S. sanctions, becoming the first company to benefit from a Justice Department program that encourages companies to self-report criminal export violations in exchange for leniency, U.S. authorities said Thursday. Between 2010 and 2017, the German enterprise-software giant sent upgrades and software patches more than 20,000 times to users in Iran, and allowed its cloud businesses to give 2,360 Iranian users access to U.S.-based cloud services, the Justice Department said." (Wall Street Journal, "SAP Admits Iran Sanction Violations To Justice Department,"  4/29/2021). 

According to its Annual Report filed with the SEC for fiscal year 2015: "During our routine internal quarterly review of transactions, we discovered that we sold certain perpetual license software products and maintenance services through a third party reseller in January 2015 to Bank Melli Iran, an entity designated by the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) as an entity owned or controlled by the Government of Iran and blocked pursuant to Executive Order No. 13382. The transaction was consummated with a third party reseller located in Dubai, United Arab Emirates and we received payment of $29,733 for the sale of the software and maintenance services. At the time of fulfillment, the name and location of the end user was supplied to us as Bank Melli Iran located in Dubai, United Arab Emirates. Upon further diligence in our internal quarterly review, we recognized that the customer was blocked and immediately ceased providing all ongoing maintenance services, including access to receive updated versions of the software and support services. We therefore have no further obligations to Bank Melli Iran and do not intend to continue providing them with software or services in the future. We have voluntarily filed appropriate disclosure with OFAC and the U.S. Department of Commerce, Bureau of Industry and Security."

According to its Annual Report filed with the SEC for fiscal year 2019: "In this context, SAP voluntarily self-disclosed potential export controls and economic sanctions violations to the U.S. DOJ and the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC) in September 2017. At the same time, SAP provided notification to the U.S. SEC and responded to an SEC comment letter on export restriction matters in October 2017. SAP has also provided disclosure to the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) based on the same alleged facts. Finally, pursuant to Section 219 of the U.S. Iran Threat Reduction and Syria Human Rights Act of 2012 and Section 13(r) of the U.S. Securities Exchange Act of 1934, SAP has filed the required Iran Notice with the U.S. SEC. The alleged conduct may result in monetary penalties or other sanctions under U.S. sanctions and export control laws."

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According to its Annual Report filed with the SEC for fiscal year 2018: "SAP has taken remedial actions to terminate access to SAP products and services for certain end users and block additional business activities with these end users through SAP or SAP partners. We have implemented further enhancements to our export control compliance program, including new internal controls, and have increased the capacity of the Export Control Compliance team with a particular focus on high-risk countries. SAP has also required additional due diligence, conducted by independent third-parties, for certain SAP partners based in high-risk regions. We are fully committed to compliance with all U.S., EU, and German laws regarding economic sanctions and export controls, including laws restricting the sale, export, and usage of SAP software and services in Iran and in other embargoed countries."

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According to its Annual Report filed with the SEC for fiscal year 2017: "The Company is investigating allegations that certain Company independent partners violated the Company’s contractual terms and sold Company products and services in embargoed countries, including Iran, Syria, Sudan, and Cuba. These third parties presumably did not adhere to the Company’s strict procedures for indirect business activities. To the extent any independent company chooses not to follow the Company’s licensing procedures, the Company is ultimately limited in its ability to stop their activities.  Nonetheless, the Company devotes considerable resources to prevent and mitigate such activities should they occur. We are also investigating allegations regarding direct sales between the Company and certain customers, who may have engaged in unauthorized activities in Iran and other embargoed countries. The Company’s Legal Compliance and Integrity Office is conducting investigations with the assistance of an external law firm."

In 2019, CalSTRS identified Logo Yazim Sanayi Ve Ticar as potentially having ties to Iran. CalSTRS subsequently removed the company after confirming the winddown of their Iranian involvement and reviewing the company’s internal controls. 

According to the Oracle website, "In accordance with United States’ and applicable export control and economic sanctions laws and regulations, all Oracle products and services* are prohibited for export/reexport/transfer (includes in-country transfer) to or access by (includes cloud access) the following:

Any company or national of Cuba, Iran, North Korea, Sudan, Syria, and the Crimea region. Export licensing of commodities or services intended for these countries is presumed denied;"

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According to its Annual Report filed with the SEC in 2013: "We recently identified an order placed in February 2013 for $1,541.05 for one of our database software products by a non-U.S. third party reseller through a non-U.S. third party partner on behalf of an entity that is an overseas branch location (outside of Iran) of a financial institution owned or controlled by the Government of Iran that has been designated pursuant to Executive Order 13224. Our software was included as part of an overall banking software solution being licensed from the non-U.S. reseller to this entity, and the Oracle software constituted a very small component – approximately 2% of the cost – of the overall solution. To our knowledge, no employees of Oracle had any contact with this entity during fiscal 2013. Upon learning of this order and verifying the identity of this entity, we deactivated this entity in our ordering systems and terminated all business activities involving this entity. Oracle does not intend to continue this activity or to knowingly permit any activities with this entity in the future. We have implemented additional measures designed to prevent such activity from recurring. We are unable to calculate the net profits attributable to this activity, but such net profits would be less than the revenues.

We also identified a transaction for $5,516.52 between Oracle and the United Arab Emirates office of an insurance company owned or controlled by the Government of Iran. In March 2013, this entity renewed its support contract for our database and middleware software products that this entity had licensed through various non-U.S. third party partners and resellers prior to the date such entity was formally designated as owned or controlled by the Government of Iran. No employees of Oracle provided any customer support services to this entity during fiscal 2013. Upon learning of this support renewal, we terminated the support contract, deactivated this entity in our ordering systems and terminated all business activities involving this entity. Oracle does not intend to continue this activity or to knowingly permit any activities with this entity in the future. We have implemented additional measures designed to prevent such activity from recurring. We are unable to calculate the net profits attributable to this activity, but such net profits would be less than the revenues.

We have made voluntary disclosure of these matters to the Office of Foreign Assets Control (“OFAC”) of the U.S. Department of Treasury and intend to cooperate fully with OFAC."

According to its Annual report filed with the SEC in 2013: "In 2008, an order was placed by a third-party U.K. reseller of Mimecast Services Limited (“MSL”), our U.K. operating company, for ongoing email archiving services to Persia International Bank (“PIB”), which is based in London, United Kingdom. On July 27, 2010, PIB was named as a designated person on the EU Council Regulation against Iran. In March 2015, we determined that the provision of services after July 26, 2010 by MSL to PIB may have constituted an indirect breach by us of EU Council Regulation 267/2012. We terminated the PIB account with the U.K. reseller in April 2015 and also determined that no payments had been received by us from our channel partner related to this account since April 2014 and that the total revenue recognized by us over the life of the account was less than £12,500. On October 25, 2007, PIB had previously been included on the U.S. List of Specially Designated Nationals and Blocked Persons under Executive Order 13382. The designation was amended on August 16, 2010 to add a designation under the Iranian Financial Sanctions Regulations. In January 2016, the EU lifted the sanctions on PIB and its shareholder banks, Bank Mellat and Bank Tejarat. However, based on our review to date, because of the U.K. nexus to the activities, we believe this sale did not constitute a violation of U.S. trade sanctions administered by OFAC. However, we may experience reputational harm as a result of the transaction by our U.K. operating company. We have since implemented additional export control compliance management oversight and have undertaken remedial measures and additional screenings to reduce the risk of similar events occurring in the future."

According to its Annual Report filed with the SEC in 2017: "During our first quarter of fiscal year 2016, we determined that a representative of the Paris branch of Bank Melli purchased a year-long subscription to Adobe Export PDF, a software service we provide. On January 16, 2016, Bank Melli was removed from the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) Specially Designated National List; however, it remains an entity whose property and interests in property must be blocked by U.S. persons pursuant to Executive Order 13599. Upon further investigation and verification of the identity of the entity, we promptly deactivated the account."

MESPAS products are listed on the website of the sanctioned Iranian company Marine Information Technology Development Company (“MITD”).

In 2016 AdaptiveMobile reconfirmed its position to UANI.

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"AdaptiveMobile Security Ltd. ended its contracts with an Iranian phone company following the disclosure that the closely held firm supplied and serviced technology for monitoring and storing text messages. AdaptiveMobile, based in Dublin, stopped doing business with MTN Irancell, Iran's second-largest mobile provider, as of May 24, according to United Against Nuclear Iran, a New York- based advocacy organization that pressures companies to cut business ties to Iran. The group cited an e-mail from AdaptiveMobile. Iranian authorities use surveillance technologies to round up and interrogate political activists, according to accounts provided by victims and human rights groups. AdaptiveMobile sold technology for monitoring and storing text messages to Irancell in 2008, Bloomberg News reported last October. The company was still servicing the commercial gear. Police have access to the system, two former MTN Irancell managers said. 'We applaud AdaptiveMobile for ending its business in Iran,' said Kristen Silverberg, president of United Against Nuclear Iran, in a statement. 'AdaptiveMobile has made the responsible decision, and we encourage other telecommunications companies to follow suit.'" (Bloomberg, "AdaptiveMobile Drops Iran Contracts On Gear For Text Monitoring," 6/7/12)

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"Stockholm-based Ericsson AB, Creativity Software Ltd. of the U.K. and Dublin-based AdaptiveMobile Security Ltd. marketed or provided gear over the past two years that Iran's law enforcement or state security agencies would have access to, according to more than 100 documents and interviews with more than two dozen technicians and managers who worked on the systems... AdaptiveMobile, backed by the investment arm of Intel Corp. (INTC), proposed a system in partnership with Ericsson for Iran’s largest mobile provider in 2010 that would filter, block and store cell phone text messages, according to two people familiar with the discussions. An Ericsson spokesman confirmed the proposal... AdaptiveMobile says its technologies are for fighting spam, viruses and 'inappropriate content,' not designed or sold for law enforcement. It says it plans to cease doing business in Iran when its contract is up in late 2012, because continuing in Iran’s current political climate could damage its reputation... Ericsson, which bid on the system, was told by MCI, the country’s largest wireless operator, to partner with AdaptiveMobile for monitoring and filtering technology, according to Ericsson spokesman Fredrik Hallstan. Ericsson didn’t win the contract, he says... The 3.9 million-euro ($5.5 million) system AdaptiveMobile proposed could handle more than 10,000 messages per second and archive them for a period of 180 days, according to a company proposal. The archive would contain 54 terabytes of storage, according to the document. That’s big enough for all the data gathered by the Hubble Space Telescope over 20 years... In 2008, AdaptiveMobile sold Irancell technology to filter, block and store text messages. Text message monitoring was required by security forces, who use the technology for their own purposes, according to two former Irancell managers... An Adaptive document detailed the system requirements. It would analyze all messages in English, Persian or Arabic for keywords or phrases; store them; and flag those caught by filters for review... Two former Adaptive employees say there were discussions within the company about law enforcement requests as the project came together... While Adaptive’s executives confirm the Irancell deal and an upgrade to the system to handle more messages, they say it was intended only for commercial purposes. They deny any involvement with Iran security or police... 'We are sure our product is not being used in this way,' says AdaptiveMobile CEO Brian Collins... Asked if AdaptiveMobile’s systems could scour for political content on activists, Chief Operating Officer Gareth Maclachlan said, 'Technically, yes, it is possible.' He says he doubted they would be practical for that purpose... As recently as 2010, AdaptiveMobile attempted to sell a similar product to MCI, the one on which it partnered with Ericsson. Collins and Maclachlan say they were not familiar with details of the proposal... Intel Capital, the investment arm of the world’s largest chipmaker, has invested 6 million euros in AdaptiveMobile, which was founded in 2003. Kristof Sehmke, an Intel Capital spokesman, said in a statement that his company strives to comply with all legal requirements... According to data compiled by Bloomberg, Ericsson signed at least 27 contracts worth $5.25 million with the U.S. government from the start of 2009 to the end of 2010. The data showed no U.S. government business with AdaptiveMobile or Creativity Software." (Bloomberg, "Iranian Police Seizing Dissidents Get Aid of Western Companies" 10/30/2011)

"Creativity Software declare themselves “proud” to supply surveillance technology to Iran in unrepentant response to Privacy International’s letter" (2/8/2018)

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"A British company, Creativity Software, announced in August 2009 that it had won a contract to supply the technology, which it said would allow MTN Irancell to offer its customers special rates at home. 'Creativity Software has worked in partnership with Huawei, where they will provide first and second level support to the operator,' the company said at the time. An official with Creativity Software did not respond to requests for comment. In a statement last year, the company said its sale was legal and 'any connection implied between the provision of commercial location-based services deployed by MTN Irancell in Iran and any possible human rights abuses is ... erroneous.'" (Reuters, "Special Report: How foreign firms tried to sell spy gear to Iran," 12/4/2012)

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"In the House of Lords today, David Alton asked why the sale of such software to Iran is allowed; what the government makes of democracy activists who say it has been used against them; and asked for an accounting of sales to Iran of such gear by Creativity Software Ltd., a British technology company which has had links to Foreign Secretary William Hague... He asked if the government intends 'to permit Creativity Software to continue providing British-made intercept software and equipment to Irancell.'... Creativity Software this year sold a system that enables Iranian law enforcement and security forces to monitor cell phone locations, Bloomberg News reported on Oct. 31 citing three people familiar with the transaction... For that article, Creativity Software confirmed that it counts mobile-phone operator MTN Irancell Telecommunications Services Co. as a client but declined to discuss sales of any location-tracking gear for law enforcement purposes, saying it would breach contract confidentiality. The company didn’t immediately respond to a phone call seeking comment today... Separately, Alton said Hague should answer questions over his link to Creativity Software, based in Kingston upon Thames... Before being named foreign secretary, Hague received money from Bruce Macfarlane and Alan Morgan, the managing partner and chairman of MMC Ventures Ltd., to pay for a researcher, according to filings with the House of Commons. MMC Ventures has a stake in Creativity Software... 'MMC Ventures is a minority investor in Creativity Software and as such it would be completely inappropriate for us to comment on the day-to-day running of the company, including the individual contracts that they have, not least for reasons of confidentiality,' the company said in an e-mailed statement."(Bloomberg, "U.K. Urged to Ban Sale to Iran of Software Used to Crush Dissent," 11/8/2011)

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"Stockholm-based Ericsson AB, Creativity Software Ltd., of the U.K. and Dublin-based AdaptiveMobile Security Ltd. marketed or provided gear over the past two years that Iran's law enforcement or state security agencies would have access to, according to more than 100 documents and interviews with more than two dozen technicians and managers who worked on the systems... Ericsson and Creativity Software offered technology expressly for law enforcement use -- including a location- monitoring product proposed by Ericsson in early 2009 and one sold this year by Creativity, according to the interviews... Early this year, Creativity Software sold a system that enables Iranian law enforcement and security forces to monitor cell phone locations, according to three people familiar with the transaction. With it, police can track a target’s movements every 15 seconds and plot the locations on a map, according to a 19-page company product specification document. Creativity Software confirms that Irancell is a client, but declined to discuss sales of any location-tracking gear for law enforcement purposes, saying it would breach contract confidentiality... Creativity Software, based southwest of London in Kingston upon Thames, announced a deal in August 2009 to sell Irancell commercial customer location services... Early this year, it sold the mobile phone provider a second system that allows law enforcement to locate and track targets, according to three people familiar with the transaction... The system can record a person’s location every 15 seconds -- eight times more frequently than a similar system the company sold in Yemen, according to company documents. A tool called 'geofences' triggers an alarm when two targets come in close proximity to each other. The system also stores the data and can generate reports of a person’s movements. A former Creativity Software manager said the Iran system was far more sophisticated than any other systems the company had sold in the Middle East... Creativity Software held initial conversations with MCI early this year to provide a nearly identical system, according to two former Creativity managers, though the status of those talks is unclear... Employees at Creativity Software were concerned about selling the technology to Iran, says Venu Gokaram, who worked as a test manager for the company until early this year... Creativity Software, which is privately-held and partly funded by London-based venture capital firm MMC Ventures, announced last November that it had made four sales in six months in the Middle East for law enforcement purposes without identifying the mobile operator clients... Saul Olivares, market development director at Creativity Software, declined to discuss sales of law enforcement technology, but in an e-mail he pointed to its practical benefits, such as locating individuals during disasters, for ambulance crews and in other emergencies... Jon Coker, investment director at MMC Ventures and a board member at Creativity Software, declined to comment... According to data compiled by Bloomberg, Ericsson signed at least 27 contracts worth $5.25 million with the U.S. government from the start of 2009 to the end of 2010. The data showed no U.S. government business with AdaptiveMobile or Creativity Software." (Bloomberg, "Iranian Police Seizing Dissidents Get Aid of Western Companies," 10/31/2011)

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"The same month the Chinese embassy posted the article, Creativity Software, a British company that specializes in 'location-based services,' announced it had won a contract to supply a system to MTN Irancell. 'Creativity Software has worked in partnership with Huawei, where they will provide first and second level support to the operator,' the company said... The announcement said the system would enable "Home Zone Billing"—which encourages people to use their cellphones at home (and give up their land lines) by offering low rates—as well as other consumer and business applications that track user locations. In a description of the service, Creativity Software says its technology also enables mobile-phone operators to 'comply with lawful-intercept government legislation,' which gives police access to communications and location information... A former telecommunications engineer at MTN Irancell said the company grew more interested in location-based services during the antigovernment protests. He said a team from the government's telecom-monitoring center routinely visited the operator to verify the government had access to people's location data. The engineer said location tracking has expanded greatly since the system first was installed... An official with Creativity Software confirmed that MTN Irancell is a customer and said the company couldn't comment because of 'contractual confidentiality.'" (The Wall Street Journal, "Chinese Tech Giant Aids Iran," 10/27/2011)

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“Creativity Software sold the [‘protester-tracking’] product to the [Iranian] regime despite concerns that it has been used to round up activists communicating with their mobile phones.” This “protester-tracking” product “can be used to pinpoint a person’s location and track their movements.” (The Daily Telegraph, “British firm with links to William Hague sells ‘protester-tracking’ product to Iran,” 7/11/2011).

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In a press release published on its website, Creativity announced it had been selected by Irancell to provide 'end-to-end' LBS solutions and be the second largest operator in Iran with LBS infrastucture. (Creativity Software website)