OFAC Sanctions Against North Korea

In 2017, OFAC imposed new sanctions against North Korea. These sanctions were imposed due to North Korea’s actions in Asia that threatened the security of the United States and is allies. The goal of these new sanctions was to target North Korea’s weapons program, as well as its economy by blocking financial transactions as well as the shipment of goods and services to the country.

One of the key components of these sanctions is the prohibition on conducting business with North Korean entities or individuals designated by OFAC, thereby isolating the country from the global financial system, and impeding its access to crucial resources.

The Executive Order imposing these sanctions includes secondary sanction which authorizes the Secretary of Treasury, in consultation with the Secretary of State, to impose sanctions on anyone who is found conducting any transaction with North Korean entities.

What is Targeted by the Sanctions

The 2017 sanctions against North Korea targets the country’s shipping network, including vessels and aircrafts visiting North Korea from the United States. Financial institutions now must be extremely cautious of conducting or facilitating any transactions on behalf of certain designated individuals and entities.

Furthermore, the Secretary of Treasury can seize any funds in violation of the sanctions that comes within the US, or in the possession of a US person. Financial institutions must decide whether they want to facilitate transactions for North Korea and its supporters or the United States.

The sanctions also target specific sectors of the North Korean economy, such as coal, minerals, seafood, and textiles, which are significant sources of revenue for the country. By limiting North Korea’s ability to export these goods and generate income, the sanctions aim to deprive the government of the financial resources needed to sustain its weapons programs.

Moreover, the OFAC sanctions against North Korea are not limited to economic measures alone. They also encompass measures aimed at disrupting illicit activities conducted by the North Korea to evade sanctions, such as smuggling, cybercrime, and the use of front companies to conceal financial transactions. Through targeted enforcement actions and collaboration with international partners, OFAC seeks to disrupt these illicit networks and prevent North Korea from circumventing sanctions.

What You Need to Know

OFAC sanctions against North Korea represent a key component of international efforts to address the security threat posed by the country’s nuclear weapons program and aggressive behavior. By targeting key sectors of the North Korean economy and disrupting illicit activities, these sanctions aim to pressure the regime to change its behavior and engage in meaningful dialogue towards denuclearization and regional stability.

It is essential to be wary of any North Korean entity or person. Likewise, any potential good or service that could be provided to a North Korean must be screened to ensure that they will not have end-users in North Korea unless specifically permitted by a General license. You should consult with an experienced sanctions lawyer before engaging in any business or transaction relating to North Korean sanctions.