Sunseeker’s teak fine branded little more than ‘slap on the wrist’

Sunseeker has agreed to pay a fine of $200,000, and to implement a compliance plan, among other penalties, says the Department of Justice (DoJ) after admitting to using illegally obtained Burmese teak on yachts imported into the USA. The firm is due to be formally sentenced on 20 August.

According to the DoJ, Sunseeker pleaded guilty to using Burmese Teak on its yachts, specifically, a teak balcony door intended to be incorporated into a yacht, and teak parts incorporated into two yachts priced at approximately $2.98 million and $1.07 million, respectively.

Why the US acted against Sunseeker

“Our ports are not open to illegal goods,” says US attorney Jason Reding Quiñones. “Sunseeker admitted that illegally obtained Burmese teak was used on yachts imported into the United States.

“That matters.

“Trafficking in illegal timber, wildlife, and other protected natural resources harms legitimate businesses, supports corrupt supply chains, and turns the natural world into profit for criminal organisations. This guilty plea, fine, and compliance requirements are a direct step toward accountability.”

EIA says penalty fails to match yacht values

While the London-based Environmental Investigation Agency (EIA) welcomes the guilty pleas entered by the UK luxury yacht manufacturer (Sunseeker International and its US subsidiary Sunseeker USA Sales) for violations of the US Lacey Act, EIA forests campaigns leader Faith Doherty says the fine doesn’t amount to that much.

“Given that the two yachts involved in the US case were priced at approximately $2.98 million and $1.07 million, the $200,000 fine is effectively little more than a financial slap on the wrists – nevertheless, this outcome still sends a clear message that companies cannot ignore the risks associated with sourcing teak from Myanmar.”

The illegal logging of teak in Myanmar has been a known problem since at least 2017. Both the US and the UK have imposed sanctions against Myanmar. The US sanctioned the Myanma Timber Enterprise (MTE), the sole authorised seller of export teak harvested in Myanmar. The US sanctions prohibit all transactions by US persons, or those transiting the US, that involve any property or interest in property associated with the MTE.

Assistant director Doug Ault (US Fish and Wildlife Service Office of Law Enforcement) is clear.

“Timber trafficking is a transnational crime that damages forests and puts legitimate businesses at a disadvantage,” he says.

“We are actively disrupting illegal timber supply chains and holding violators accountable under the Lacey Act. This case is part of our ongoing work to protect natural resources and ensure American markets aren’t a destination for illegal goods.”

How Myanmar teak became a global compliance risk

The Lacey Act prohibits the trade of wildlife and plant products sourced in violation of US or foreign laws.

“Congress amended the Lacey Act in 2008 to prohibit the importation of illegally harvested timber,” says principal deputy assistant attorney general Adam Gustafson. “By enforcing the law, we ensure a level playing field for companies that follow the law.

“Timber trafficking is the third most lucrative form of transnational crime, so enforcing the law keeps money from flowing into criminal enterprises.”

Sunseeker’s response to the investigation

Earlier this week, a spokesperson for Sunseeker told MIN that the company “has engaged fully throughout and continues to cooperate transparently with the relevant authorities. Sunseeker has completed a thorough review, during which Sunseeker has undertaken comprehensive due diligence. The company has implemented a strengthened policy governing the sourcing and trading of all teak to help ensure that materials are sourced responsibly and in compliance with UK, EU and US law.”

The case marks one of the most significant US enforcement actions involving Myanmar teak since the country’s 2021 military coup and demonstrates the continued importance of robust environmental laws such as the US Lacey Act and the former EU Timber Regulation (EUTR) in combatting illegal logging and associated human rights abuses.

Teak trade is not victimless

“The Myanmar teak trade is not a victimless environmental crime,” continues Doherty. “Revenues from this trade have helped sustain a brutal military regime linked to widespread human rights abuses and violence against civilians.

“The US Lacey Act and the EU Timber Regulation have shown that strong due diligence and enforcement laws are essential tools in tackling illegal logging and corporate complicity in high-risk supply chains.”

Sunseeker exposed in 2018

EIA first exposed Sunseeker’s use of Myanmar teak in 2018 through investigations which found teak linked to breaches of European timber laws entering the company’s supply chains.

In 2024, the company pleaded guilty in the UK to criminal offences under the UK Timber Regulation for illegal imports of Myanmar teak and was fined £358,759.64 by Judge Jonathan Fuller KC at Bournemouth Crown Court.

At the time, Fuller said Sunseeker was aware of impending rule changes to timber imports after Brexit which changed its status from ‘trader’ to ‘operator’ and left it in breach of regulations, calling it a ‘systemic failure’. He pointed out that EIA had flagged the risk of illegal teak in Sunseeker’s supply chain to the company as early as 2018.

Could tougher enforcement change industry sourcing?

Myanmar’s teak trade has long been associated with corruption, illegal logging and severe human rights abuses. Since the coup, revenues from the state-controlled timber sector have helped support a military junta responsible for widespread violence and atrocities against civilians.

The Myanmar Timber Enterprise (MTE), the sole legal exporter of teak from Myanmar, is sanctioned by the EU, UK and US.

The latest US prosecution demonstrates that strong legal frameworks can work when authorities are willing to enforce them. EIA is now calling on governments and industry actors to strengthen enforcement against illegal timber imports. That can be done with increased scrutiny of high-risk supply chains linked to sanctioned entities, supporting full implementation of strong due diligence frameworks, and ensuring companies sourcing forest-risk commodities are held accountable for environmental crime and associated human rights harms.

Myanmar teak remains highly prized within the luxury yacht industry due to its durability and appearance. Forest Stewardship Council (FSC) runs a forest certification system and works to mitigate the climate and biodiversity crises by advancing sustainable forest management worldwide.

It says teak is a highly traded commodity across the world and is designated as a high-risk species because of numerous reports about illegal logging and illegal trade. While the trade of Burmese teak is considered illegal in many countries, companies continue to sell and purchase Burmese teak, sometimes hiding its true origin. There are no FSC-certified teak forests in Myanmar.

“We cannot talk about this industry without talking about the sector’s historical dependence on teak from Myanmar,” Kristian Jørgensen, technical advisor at FSC Denmark, told MIN in 2023.

“Yacht decking has shown itself to be the Achilles’ heel of the industry. The use of natural teak is not just justified by the luxurious look of the timber, but by the extreme technical quality of the wood.”