Former South Metro Denver Chamber of Commerce Chairman Rick Jory got caught in a frustrating quagmire with the U.S. Treasury Department, which earlier this year collected a $126,000 fine from Highlands Ranch-based Sandhill Scientific Inc. for illegally exporting goods to Iran and for not immediately turning over documentation.

Jory, the CEO of the Highlands Ranch medical-equipment manufacturer since 1994, describes a transaction that took place without his knowledge in 2007, and says he had no idea what the federal government was even investigating at first.

The incident, detailed in government documents just released under a Freedom of Information Act request, concerns a $6,700 sale of disposable catheters that went through Dubai, United Arab Emirates, on its way to Iran.

Nothing was shipped directly from Sandhill to Iran, one of four countries considered to be a “state sponsor of terrorism” by the U.S. government, which bars transactions without consent from the Office of Foreign Assets Control.

When the investigation began in April 2008, the employee who handled Sandhill’s international accounts at the time of the incident was no longer employed by the company, leaving Jory in a bind.

“At that time we did not have (the employee’s) emails or access to (the employee’s) computer,” said Jory, who agreed to a settlement in April of this year. “I was sitting here blind, trying to comply with the government’s informational request, but they weren’t being specific about what they were looking for.”

According to Jory, after numerous communications with OFAC, once he was finally informed of precisely what they were seeking, he was able to retrieve the information within minutes and he presented the information to them.

“If I was trying to do something devious, I would be the first person to say, ‘Oh, I got caught, and I have to pay a penalty,’ ” Jory said. “In this case, I was blindsided and I felt that (OFAC) was trying to set me up by not telling me what they were looking for in the first place. Once I saw the invoice and the records, I totally admit we had shipped something that ended up in Iran.”

After that admission occurred, it was about a year before OFAC served Jory with papers. In those papers, OFAC accused him of being “directly involved in the willful and reckless conduct that led to the apparent violation,” of “concealing its activities by removing identifying information associated with Iran from its shipment” and “not cooperating with OFAC’s investigation.”

“The problem in all this,” Jory said, “is they acted like I was stonewalling or withholding information, and No. 1, that’s not me, No. 2, there’s just no reason to do that. Had (OFAC) come out up front and said, ‘Hey, Mr. Jory, we have records that state on such and such date you shipped such and such to a guy in Dubai,’ I could have gotten him that information in a matter of minutes, but they never did that.”

Jory’s biggest complaint in the settlement was the “character attacks,” but he said he did not fight OFAC on it because, according to his attorney, he was not going to get a better deal than what was offered.