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Sara Lee Corp. To Pay $725,000 for Illegally Aiding Israeli Boycott

August 13, 1988 GMT

WASHINGTON (AP) _ Sara Lee Corp. has agreed to pay a $725,000 civil penalty to settle charges that it violated federal laws by aiding the Arab boycott of Israel, the government said Friday.

G. Philip Hughes, assistant secretary of commerce for export enforcement, said an order signed Friday requires the food and clothing manufacturer to pay the penalty within 20 days.

Hughes said it was the second-largest anti-boycott penalty ever collected. On March 22, Safeway Stores Inc. of Oakland, Calif., agreed to pay $995,000 to settle charges stemming from its operation of markets in Kuwait and Saudi Arabia.

Sara Lee agreed to the payment, without admitting or denying guilt, shortly before the scheduled Aug. 1 start of a trial before an administrative law judge.

Following a three-year investigation, the department charged Sara Lee on Nov. 19 with 235 violations carrying a maximum possible penalty of $2.35 million.

The department said Sara Lee, in connection with an attempt to register trademarks in Kuwait, furnished information about the names and nationalities of members of its board of directors and the names and places of incorporation of U.S. and foreign subsidiaries.

Such information is used by Arab League countries to make blacklist decisions in its boycott of Israel, the department said.

An employee answering the telephone at Sara Lee offices in Chicago said company officials would not be available for comment until Monday.