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Financial Services Law Insights and Observations

OFAC issues sanctions, GL, and FAQ on countering narcotics

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

Financial Crimes

On December 14, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order 14059 against an individual for being involved in activities or transactions that materially contributed to, or pose a significant risk of materially contributing to, the international proliferation of illicit drugs or their means of production. According to OFAC, the designated individual is the leader of a Dominican Republic-based criminal organization engaged in various illicit activities, and his organization controls several drug trafficking routes into the U.S. As a result of the sanctions, all property and interests in property belonging to the sanctioned persons subject to U.S. jurisdiction are blocked and must be reported to OFAC. Additionally, “any entities that are owned, directly or indirectly, 50 percent or more by one or more blocked persons are also blocked.” U.S. persons are also generally prohibited from engaging in any dealings involving the property or interests in property of blocked or designated persons.

The same day, OFAC issued Counter Terrorism General License (GL) 21A, Authorizing Limited Safety and Environmental Transactions Involving Certain Vessel. GL 21 authorizes all activities otherwise prohibited by the Global Terrorism Sanctions Regulations (GTSR), 31 CFR part 594, that are ordinarily incident and necessary to the limited safety and environmental activities described in paragraph (a) of GL 21A involving certain blocked persons and vessels through January 14, 2023. Additionally, OFAC announced it is amending a Counter Terrorism Frequently Asked Question 1097, which clarifies GL 21A.