“Compliance Insight” is published quarterly for individuals & companies who must adhere to OFAC & BIS sanctions. With the ever evolving world of regulatory compliance, this newsletter is written to provide brief updates on what you need to know. Not sure if OFAC or BIS applies to your business? Then this newsletter is definitely for you.
OFAC: What You Should Know
By Lori Moore, Director of Compliance, ATTUS Technologies
All U.S. based businesses must comply with OFAC’s requirements against doing business with targeted foreign countries, terrorists, international narcotics traffickers and those engaged in activities related to the proliferation of weapons of mass destruction.
The various OFAC-administered sanctions programs prohibit a broad range of activities, which differ according to the objectives of U.S. foreign policy and security goals. OFAC imposes two types of sanctions - country-based and list-based.
Country-based sanctions limit or prohibit business interaction with targeted countries. Some restrictions prohibit almost all business activity with the sanctioned country. Other country-based restrictions only limit business transactions involving specially designated parties that act on behalf of a targeted country or region, however conducting business with a non-targeted party located in a designated country or region is not prohibited.
List-based sanctions impose restrictions against engaging in business or financial transactions with specially designated individuals or parties, called Specially Designated Nationals (SDN). Persons on this list are considered to pose a threat to the U.S. due to their activity with drug trafficking, terrorism, the proliferation of weapons of mass destruction or other types of illegal activities.
As stated, OFAC sanctions regulations prohibit any U.S. business from doing business with sanctioned or blocked persons or entities otherwise known as SDNs. The only way businesses can ensure that they do not engage in a transaction with a party on the SDN list is to frequently check the names of persons or entities it does business with against the constantly changing OFAC SDN List.
The SDN list is updated as new individuals and entities are identified. In theory, the list could change daily in any given time period. Checking the latest edition of the SDN list as well as OFAC’s website at http://www.ustreas.gov/offices/enforcement/ofac/ for updated information and current restrictions that affect the countries and parties with which you plan to do business is central to remain OFAC compliant.
Next Issue's Feature: BIS COMPLIANCE
OFAC Specially Designated Nationals Update
5/11/11
· Anti-Terrorism Designations
5/5/11
· Libya Identifications
· Non-proliferation Designations Removals
· Non-proliferation Designation Updates
4/28/11
· Kingpin Act Designations & Kingpin Act Designation Updates
· Anti-Narcotics Designation Removals
· Sudan Designation Removals
4/20/11
· Foreign Narcotics Kingpin Designation Act Update
4/19/11
· North Korea Designation
4/8/11
· Libyan Sanctions Designations
4/4/11
· Libyan Sanctions Designation Removal
OFAC In The News
5/9/11 Release of 2010 Terrorist Asset Report
4/29/11 Blocking Property of Certain Persons with Respect to Human Rights Abuses in Syria
4/28/11 Treasury Designates Iranian Narcotics Trafficker with Ties to Afghan Drug Trade
4/26/11 Libya Oil/Gas General License & Statement of Licensing Policy
4/26/11 Release of OFAC Civil Penalties Information
4/20/11 Treasury Designates Five Leaders of the Kongra-Gel as SDN Traffickers
4/19/11 Executive Order 13570: Prohibiting Certain Transactions With Respect to North Korea
4/14/11 SDN Data Files include Expanded City/St/Province/Postal Code Field
4/12/11 Guidance Regarding Sudanese Sanctions Applying to the New State Formed in Southern Sudan
4/8/11 Release of OFAC Civil Penalties Information
4/8/11 Blocking Property & Prohibiting Certain Transactions Related to Libya
BIS Denied Persons List Updates
4/26/11
76 F.R. 22865
ORION AIR, S.L.
CANADA REAL DE MERINAS 7 EDIFICIO 5, 3'A EISSENHOWER BUSINESS CENTER
28042 MADRID, ES
ORION AIR, S.L.
AD. DE LAS CORTES VALENCIANAS NO 37 ESC.A PUERTA 45
46015 VALENCIA, ES
SYRIAN PEARL AIRLINES
DAMASCUS INTERNATIONAL AIRPORT
DAMASCUS, SY
4/6/11
76 F.R. 19033
CREDIT INTERNATIONAL TRADING CO LTD (11TH INSTITUTE)
NO 9A DONGTUCHENG ROAD, HEPING STREET,
CHAOYANG DISTRICT, BEIJING, CHINA 100039
CREDIT INTERNATIONAL TRADING CO LTD (11TH INSTITUTE)
NO. 2 ZHONG GUAN CUN NAN STREET,
HAIDIAN DISTRICT, BEIJING, CHINA 100039
4/5/11
76 F.R. 18716
MANOJ BHAYANA
65 W. MANILA AVENUE
PITTSBURGH, PA 15220
BIS In The News
4/18/11 Implementation of Additional Changes From the Annual Review of the Entity List; Removal of Person Based on Removal Request FR 21628
QUESTION:
Are there any reporting obligations if you perform a delta review of a prior transaction that passed the screening process the first time, but produced a match when the amended list was used?
ANSWER:
Transactions that are conducted prior to a party being designated and added to the SDN list would not be in violation. Engaging in business that is prohibited with a party on the SDN list would be a violation as of the date that the party was designated and the SDN list updated. Therefore, if you encounter a positive match on an account or transaction that was previously screened and a potential match was not flagged, your first step would be to verify when the applicable sanction went into effect. If you determine that a transaction(s) in violation of a sanction program had been conducted, even unknowingly, you should immediately contact OFAC. The severity of the consequences is much less when violations are voluntarily disclosed. Additionally, OFAC will instruct you as to whether the transaction should be rejected or blocked. In either case, you will be required to submit a Report of Blocked or Rejected Funds.
If you perform a delta review as updates are released, your risk of violations is much lower. Any window of time between when the SDN list is updated and when you compare your existing customer base to the updated list does pose greater risk.
ATTENTION READERS
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