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Financial Services Law Insights and Observations

OFAC sanctions individual and entity connected to international terrorism

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

Financial Crimes

On September 29, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions in coordinated efforts with the Government of Qatar, pursuant to Executive Order 13224, as amended, against seven individuals and one entity connected to a major Hizballah financial network based in the Arabian Peninsula. According to OFAC, three of the individuals are designated as Specially Designated Global Terrorists (SDGTs) “for having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, Hizballah.” Four additional individuals have been designated as SDGTs “for having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of,” one of the three individuals designated as SDGTs above. One entity is also being designated “for being owned, controlled, or directed by, directly or indirectly,” one of the individuals designated as SDGTs. As a result, all property and interests in property belonging to the designated persons subject to U.S. jurisdiction are blocked, and any “entities that are owned, directly or indirectly 50 percent or more by them, individually, or with other blocked persons, that are in the United States or in the possession or control of U.S. persons must be blocked.” OFAC warned that the agency “can prohibit or impose strict conditions on the opening or maintaining in the United States of a correspondent account or a payable-through account by a foreign financial institution that either knowingly conducts or facilitates any significant transactions on behalf of a SGDT, or that, among other things, knowingly facilitates a significant transaction for Hizballah or certain persons designated for their connection to Hizballah.” OFAC’s announcement further noted that that “[e]ngaging in certain transactions with the individuals and entity designated today entails risk of secondary sanctions pursuant to E.O. 13224, as amended.”

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