InfoBytes Blog
OFAC Issues Finding of Violation for Alleged Violations of the Foreign Narcotics Kingpin Sanctions Regulations
On July 27, OFAC issued a Finding of Violation to a bank for allegedly maintaining accounts on behalf of two individuals on OFAC’s SDN list. On June 12, 2013, pursuant to the Foreign Narcotics Kingpin Designation Act, OFAC added the two individuals to the SDN list based on their involvement in money laundering operations. From June 12, 2013 to June 3, 2014, OFAC alleged that, due to a misconfiguration in the bank’s sanctions screening software, it failed to identify and block accounts belonging to them. OFAC asserted that the bank had reason to know it maintained accounts on behalf of the designated individuals as an aggravating factor under its Enforcement Guidelines, but noted that the fact that “no managers or supervisors appeared to have been aware of the conduct that led to the apparent violations” was a mitigating factor. The Finding of Violation also noted that the bank took remedial action to respond to the violations and cooperated with OFAC by signing a tolling agreement, as well as two extensions to the tolling agreement.