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Iran trade sanctions get personal in Apple stores

Updated: 3 pm ET  

An Apple store employee refused to sell an iPad to an Iranian American customer, citing company policy that aims to comply with U.S. sanctions on trade with Iran, WSBTV in Atlanta reported this week. The customer left empty-handed, in tears, and complained of discrimination to the reporter.

The case is more complicated than that, legal experts say. The incident and others like it highlight a dilemma created by the U.S. trade embargo against Iran — and other sanctioned countries, including Cuba, Syria and North Korea — which makes even the humblest sales associate responsible for enforcing the embargo’s provisions. 


Those employees — as well as the store and the company — could be hit with civil and criminal penalties if they sell products to customers who they have reason to believe will export them to Iran in violation of the embargo, legal experts say. But if the same clerk refuses service on the basis of the customer’s language or ethnic background, they may run afoul of civil rights laws.

"If I walked in and told them I want to buy this and send it to a friend in Iran or Cuba, they can’t sell it to me," said Clif Burns, an export control attorney at Bryan Cave, a law firm in Washington, D.C. "If they had that information, they were absolutely within their rights" to refuse the sale.

"The tricky question is if you hear someone speaking Farsi (also called Persian) … then the issue is: Should you be more alert to the possibility that they might export the item to Iran? And by being more alert in that situation are you in violation of civil rights statutes? It’s not any easy question."

Under U.S. sanctions against Iran — dating to 1987 and expanded several times since — exports to the Islamic republic are illegal, with exceptions for items in a few limited categories, such as books, movies, agricultural goods, medicine and medical supplies. These sanctions are enforced by the U.S. Treasury Department's Office of Foreign Assets Control and the U.S. Commerce Department’s Bureau of Industry and Security. Sanctions are not intended to affect the sale of goods used in the United States.

"There is absolutely no U.S. policy or law that would prohibit Apple or any other company from selling its products in the United States to anyone intending to use the product in the United States, including Iranians and Persian-speakers," said Pooja Jhunjhunwala, a spokesperson for the U.S. State Department.

Click here for an overview of the sanctions from the Treasury Department

But the government does not spell out how an individual working in a retail store should judge whether a customer intends to send or carry a product to a country under sanctions, and technically the onus could fall on store clerks. And Burns says anyone in the chain who touches a transaction that violates of the sanctions can be held liable if they knew or should have known that the item was being shipped to a sanctioned country.

"The standard applies to the retail clerk, shipping manager, corporate headquarters," said Burns.

Individuals can be fined up to $250,000 and up to five years in prison for export sanctions violations. Corporations can be hit with a $1 million criminal penalty, he said. "In theory there’s no intent (to commit a crime) requirement. They will look at whether you knew or should have known."

In reality, there are only a few reported cases of retailers denying individual sales on this basis, all involving Iranian Americans and Apple stores.

Apple: Silence
Apple did not initially respond to requests for comment.

After this report published, Apple spokesman Steve Dowling contacted with the following statement:

"Our retail stores are proud to serve customers from around the world, of every ethnicity. Our store teams are multilingual and diversity is an important part of our culture. We don't discriminate against anyone."

In the case of Sahar Sabet, from the WSBTV report, who was refused purchase of an iPad at an Apple store in Alpharetta, Ga., some of the facts are unclear. She said the clerk refused to sell her an iPad after hearing her speak Farsi with her uncle. The iPad was intended as a gift for her cousin in Iran, according to the report, but it was unclear how or if the clerk was aware of that.

Calls to Sabet were not returned. A call to the Apple store at North Pointe Mall in Alpharetta was referred to corporate headquarters.

A second Iranian American interviewed in the report also said he was barred from purchasing something at an Apple store in the Atlanta area when he was helping an Iranian student buy an iPhone. Zack Jafarzadeh said he and the friend were speaking Farsi when the sales rep denied their purchase. "We never talked about him going back to Iran or anything like that," Jafarzadeh said, according to the report.

The Council on American Islamic Relations, a non-profit rights group, says it was in discussions with Apple to revise its policy even before this week's news story, because of a complaint from an Iranian American who was refused a purchase in an Apple store in northern California in March.

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In that case, a sales associate refused to sell him anything — even things he was buying for his own use — after he mentioned that he intended to send an iPod Nano to Iran as a gift for a relative, Rachel Roberts, civil rights coordinator for CAIR, told

"He claims that when he asked the associate how he could get the items he needed, she told him to go to a different Apple store if he wanted service and to not reveal that he is Iranian," Roberts said — adding that he found that answer to be degrading and inconsistent. Ultimately the store made an informal apology and sold him items for his personal use, Roberts said.

"The concern … is how store employees balance their obligations under embargo law and civil rights laws," said Zahra Billoo, an attorney for CAIR in San Francisco, adding that the U.S. government should clarify how retail stores should comply. The other concern, she said, is "how employees are being trained to implement this."

Apple's policy regarding sanctions, published on its website, is closely tailored to the language of the U.S. trade law itself.

The National Iranian American Council, a nonprofit organization, said the Apple stores were "overzealously enforcing the sanctions." "In singling out Persian-speakers for interrogation about how they intend to use Apple products, these Apple employees are clearly engaging in racial profiling," the group said in a statement.

But the group provided a fact sheet on sanctions and conceded that "it also appears to be the case that many Iranian Americans do not understand the implications of how U.S. sanctions on Iran affect them."

The very notion that sales clerks could have to make decisions on purchases under the sanctions raised red flags for some observers.

"The responsibility for enforcement should fall on border patrol, law enforcement, the U.S. post office, customs -- government agencies," said Nahal Iravani-Sani, president of the Iranian American Bar Association. As it is, the law "promotes dishonesty and invites profiling. When you come down to it, it's absurd."

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