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Financial Services Law Insights and Observations

OFAC settles with digital platform on sanctioned transactions

Financial Crimes Of Interest to Non-US Persons OFAC Department of Treasury OFAC Sanctions OFAC Designations Enforcement Iran Cuba Venezuela

Financial Crimes

On March 31, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced a $72,230 settlement with a global digital trading platform to resolve allegations that it processed transactions for customers who self-identified as being located in Iran or Cuba, or were employees of the Government of Venezuela (GoV). OFAC’s web notice stated that between March 2017 and May 2022, the company, or certain of its non-U.S. affiliates, allegedly maintained accounts for customers who submitted information showing their locations were in a sanctioned jurisdiction. OFAC further maintained that the company violated the Venezuela Sanctions Regulations by processing transactions on behalf of two customers who self-identified as employees of the GoV. OFAC claimed, among other things, that the company implemented inadequate compliance processes to identify, analyze, and address risks.

In its web notice, OFAC stated that it determined that “the violations were voluntarily self-disclosed and were non-egregious.” OFAC also considered various mitigating factors, including that the company has not received a penalty notice from OFAC in the preceding five years. Additionally, the company undertook numerous remedial measures upon learning of the alleged violations, cooperated with OFAC throughout the investigation, and agreed to toll the statute of limitations, the notice said.

The company issued the following response: “We appreciate that OFAC recognized our full cooperation and remediation of the issues involved in this matter. These were self-identified and self-reported matters that reflect the rigor of our compliance review processes.”

Orrick represented the company in this matter.