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Financial Services Law Insights and Observations

OFAC sanctions al-Qa’ida-linked financial facilitators

Financial Crimes OFAC Department of Treasury Of Interest to Non-US Persons OFAC Sanctions OFAC Designations SDN List Syria Turkey

Financial Crimes

On July 28, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order 13224 against one Turkey-based al-Qa’ida financial facilitator for providing material assistance to al-Qa’ida and one Syria-based terrorist fundraiser and recruiter for providing material support to Hay’et Tahrir Al-Sham (HTS). According to OFAC, the designations “expose the continued efforts by al-Qa’ida and HTS to use the global formal financial system and highlight the need for continued vigilance against terrorist fundraising and recruitment on the internet.” As a result of the sanctions, all property and interests in property belonging to the sanctioned individuals, and “any entities that are owned, directly or indirectly, 50 percent or more by them, individually, or with other blocked persons,” that are subject to U.S. jurisdiction must be blocked and reported to OFAC. OFAC noted that OFAC regulations “generally prohibit” U.S. persons from participating in transactions with the designated persons unless exempt or otherwise authorized by a general or specific license. Furthermore, OFAC cautioned that “engaging in certain transactions with the individuals designated today entails risk of secondary sanctions,” and warned foreign financial institutions that if they knowingly facilitate significant transactions on behalf of a Specially Designated Global Terrorist, OFAC may prohibit or impose strict conditions on their opening or maintaining of correspondent accounts or payable-through accounts in the U.S.

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