THE OFFICE OF FOREIGN ASSETS CONTROL

Within the United States Department of Treasury, the Office of Foreign Assets Control (OFAC)
administers and enforces, based on American foreign policy and national security goals, economic and
trade sanctions. Targeted entities include certain foreign nations and regimes, international drug
traffickers, terrorists, those engaged in the spread of weapons of mass destruction, and others that
threaten the national security, foreign policy, or economy of the United States.

Sanctions

Much of OFAC’s mission is accomplished through sanctions. To date, the United States has sanctioned several foreign nations, including Iran, North Korea, Russia, Ukraine, Cuba, Syria, Venezuela, terrorist organizations, and drug trafficking operations.

Specially Designated Nationals (SDN)

OFAC periodically publishes a list of individuals and businesses owned or controlled by, or representing, sanctioned countries. It also lists groups, such as terrorist organizations and drug traffickers, that are not affiliated with a specific country. Those present on the SDN list have had their assets blocked and Americans generally are not allowed to deal with them.

Enforcement Actions

OFAC not only imposes sanctions nations or entities, or publishes an SDN list. It also takes enforcement actions against those who violate sanctions or have prohibited interactions with specially designated
nationals.

Bitpay, Inc.

OFAC and Bitpay, Inc. reached settlement after OFAC determined that Bitpay, Inc. negligently allowed persons from sanctioned entities to use its automated payment services. The company provided over $125,000 in economic benefits to persons in sanctioned jurisdictions, including Ukraine, Cuba, North Korea, Iran, Sudan, and Syria. These illegal transactions were found to harm the integrity of OFAC’s sanction programs.

PT Bukit Muria Jaya

OFAC fined PT Bukit Muria Jaya (BMJ) over $1,000,000. BMJ, which manufactures paper products in Indonesia, apparently had 28 violations of North Korea’s sanctions. The company used American banks to process payments related to exports of cigarette paper to North Korea.

Union de Banques Arabes et Françaises

This French bank, abbreviated as UBAF, helps entities finance trade between Europe and the Middle East, Africa, and Asia. Apparently, UBAF violates Syrian-related sanctions 127 times, primarily by illegally letting funds for its endeavors flow through the American financial system. For this, UBAF settled with OFAC for $8.5 million.

BitGo, Inc.

This technology company, based in California, offers digital wallet management services. Allegedly, BitGo allow 183 transactions that involved persons from the sanctioned nations of Ukraine, Cuba, Iran, Sudan, or Syria. For these alleged transgressions, the company settle with OFAC for nearly $100,000.

Don’t Go it Alone

Like many federal agencies or offices, OFAC has tremendous authority to impose fines for alleged transgressions. Unfortunately, due to OFAC’s broad and sweeping powers, many innocent businesses may accidently run afoul of the myriad laws and regulations surrounding foreign nations. This is
especially true in today’s international commerce, where business is conducted with individuals and nations worldwide.

Unfortunately, if you are involved in international commerce, it’s not always easy to determine if a specific individual you’re doing business with is associated with a sanctioned entity. You may accidentally and unknowingly enter into a global transaction with such an individual, and OFAC may track you down.

So, if you get caught in OFAC’s enormous enforcement web, contact our federal defense attorneys today. Don’t to it alone with OFAC, let us put our enormous federal settlement and litigation experience to work for you.