Note: Draft letter copy. Original letter was sent during the 113th Congress.

Original letter is held by the Treasury Department

David S. Cohen
Under Secretary for Terrorism and Financial Intelligence
Department of the Treasury
1500 Pennsylvania Avenue, NW
Washington, D.C. 20220

Dear Secretary Cohen:

I am writing to seek your assistance in reviewing evidence that Ukrainian steelmaker

Interpipe Group has violated the Iran Threat Reduction and Syria Human Rights Act of
2011. A body of evidence has come into my possession – which I have attached here --
details exports from Interpipe to Iranian entities. I am concerned that Interpipe, which
operates in the U.S. as North American Interpipe, Inc. of Houston, Texas, may have
contravened U.S. sanctions on Iran.

I would call your attention specifically to the business dealings of an obscure company
called Ferrotec Steel LLP. According to the enclosed evidence, Ferrotec is based in
Tehran.

As the Act makes clear, the Interpipe Group is beholden to U.S. sanctions due to its
U.S. subsidiary. The law is straightforward: “All U.S. persons must comply with OFAC
regulations, including all U.S. citizens and permanent resident aliens regardless of
where they are located, all persons and entities within the United States, all U.S.
incorporated entities and their foreign branches.”

As you know, the U.S. Congress has worked to ensure the U.S. Treasury has the
means to support U.S. national security and foreign policy goals, such as the sanctions
provided under the Iran Threat Reduction and Syria Human Rights Act of 2011. Having
said this, I am appreciative of your careful and timely review of the matter raised here.

Document Summary

Documentary Evidence

i. ‘Contract 235-11, June 16th, 2011’ – signed on June 16, 2011, the contract is
between LLC Interpipe Ukraine and Interpipe M.E. FZE, Dubai. In the contract,
Interpipe Ukraine is the seller and Interpipe M.E. the buyer. According to clause
2.2., the total value of the contract is €8,000,000. The contract indicates that the
value of the specific goods would be contained in the appendices to the contract.

Consignors of the goods under the contract were listed as: LLC Interpipe
Ukraine, OJSC Interpipe NTRP (Interpipe Nizhnedneprovsky Tube Rolling Plant,
 also known as Interpipe NTZ) and, curiously, ‘PJSC Lugtsentrokuz N.A.S.
Monyatovskogo’ (more commonly referred to as: ‘S. S. Monyatovskiy
Lugtsentrokuz” PJSC1 ). Registered at 91005, Lugansk, St Fronzc2 107, k.14,3
the owners of Lugtsentrokuz N.A.S. Monyatovskogo are unknown.

The reasoning for Interpipe to use this obscure seemingly unrelated third
company is unknown. One possible explanation could be that Interpipe wished
to distance itself from certain shipments. According to the English language
version of the Lugcentrokuz N.A.S. Monyatovsky website it has exported
products to, amongst others, North Korea and Cuba.4 Meanwhile, the Russian
and Ukrainian language versions of the website add Iran to this list.5

ii. ‘Contract 235-11 - Additional agreement’ – this prolongs contract 235-11 until
November 30th, 2012 while leaving everything else unchanged.

iii. ‘Contract 235-11 - Appendix 2 - October 3rd, 2011’, this is the second appendix
out of the original contract No. 235-11. It specifies the consignment of 500
‘Rough tyres’, for rail usage. Each of the 500 units in the delivery is priced at
€411.00, bringing a total cost, for products delivered to Bandar Abbas, of
€205,000.00. It specifies a sale to be made between October and November
2011.

The consignee is given as Ferrotec Steel LLP; 92, Negin Chokhak Trade Tower
#1535; Kolahduz Ave Tehrane-Iran; Zip Code 1939613149.

iv. ‘Contract 235-11 - Appendix 3 - March 12th, 2012’ – the document is the third
appendix to Contract 235-11. It specifies a sale to be made in May-June of 2012
and again names Ferrotec Steel as the consignee. The seller is Interpipe M.E.
and the consignment consists of 200 monoblock wheels with dimensions of
957mm x 190mm. Each of these wheels weighs 401kg and is valued at €530.00.
The consignment was for 200 wheels, giving a total price of €106,000.00.

1 A companyprofile can be found at: Orbis - LUGTSENTROKUZ IM S S MONYATOVSKOGO ZAO for a

company profile.

2 “Frunze” from the company website.

3 Page 3 of the contract. The company website provides the following address and telephone number for
the company in Ukraine: 91005, Lugansk, st. Frunze 107, housing 14.
Reception: Phone/fax +38 (0642) 58 42 18
Sales department: Phone/fax + 38 (0642) 50 13 37 ; Phone/fax +38 (0642) 50 13 82

4 http://lck.com.ua/en/history.html

5 http://lck.com.ua/ru/istoriya.html ; http://lck.com.ua/uk/istoriya.html
 This price appears to be artificially low considering that it includes freight to
Bandar Abbas and the total weight of the products in the consignment was
80,200kg which together with its volume would incur substantial shipping costs.

v. Ministry of Taxation and Revenue of Ukraine letter - August 2014 - The

authenticity of contract 234-11 and Appendix 3 has been verified by the
Ukrainian Ministry of Taxation and Revenue. In a letter dated August 20th, 2014,
and signed by O.V. Mirza, Acting First Deputy Head of Customs, it stated
(translated Ukrainian to English):
“The Dnipropetrovsk Customs Office of the Ministry confirms the
processing through customs on 23 June 2012 of the export of goods
“[wheels]” under contract dated 16 June 2011 (supplement #3 of 12 March
2012) between the seller TOV Interpipe Ukraine and buyer Interpipe ME
FZE, recipient of shipment Ferrotec Steel LLP, Iran. Electronic copies of
the customs declaration are available from PIK Inspector 2006 and EAIC
of the State Customs Service.”

vi. ‘Commission Agreement 653090049 - Dec 26th, 2008’ – the fifth document is a
commission agreement in Russian, numbered 653090049, between OJSC
Interpipe Nizhnedneprovsky Tube Rolling Plant (Interpipe NTRP) and Interpipe
Ukraine.6 This stipulates that Interpipe Ukraine will act as a sales agent for the
former. Clause 3.4.a of the agreement states “In the event that goods provided
by principal for sale are sold by Agent…at a price higher that the commission
indicated in the corresponding appendix to the present contract, the difference in
its entirety is to be transferred to the account of Principal”. The document also
contains the banking details of both parties involved, listing multiple different
banks including some in the US (see Section C below).

vii. ‘Appendix 712 of March 12th 2012 to Commission Agreement 65090049’7 –

written in Ukrainian, this details the products shipped under Appendix 3 and
names which entity is responsible for the products at the various stages of their
transport until they pass into the hands of Ferrotec Steel LLP. It also firmly ties
the Commission Agreement to Contract 235-11. NB. Appendix 712 also appears
at the end of the Commission Agreement document.

6 AnEnglish translation is also available; see: Commission Agreement 653090049 - Dec 26th,
2008_ENG

7 See also the English translation: Appendix 712 of 12.03.12 to Commission Agreement 65090049’