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OFAC issues Belarus-related General License 2E
On April 27, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) issued General License No. 2E (GL 2E) to extend the authorization allowing nine Belarusian entities to enter into transactions otherwise prohibited by Executive Order 13405. GL 2E replaces and supersedes in its entirety General License No. 2D, and authorizes transactions with any entities that are owned 50 percent or more by the nine named entities. All property and interests in property of these entities, if blocked, remain blocked, and U.S. persons must report authorized transactions or any series of transactions exceeding $50,000 to the U.S. Department of State no later than 30 days after execution. The authorization expires on October 30, unless otherwise extended or revoked.
Visit here for additional InfoBytes coverage on Belarus General Licenses.
Treasury issues general license to extend wind-down period for sanctioned Russian aluminum producer
On April 23, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) issued General License 14 (GL 14) to extend the grace period for specified wind-down activities involving a Russian aluminum producer sanctioned earlier this month. As previously covered in InfoBytes here, the April 6 sanctions—issued pursuant to the Countering America’s Adversaries Through Sanctions Act of 2017—allowed U.S. persons until May 7 to wind down operations involving identified blocked persons. According to Treasury’s press release, GL 14’s new October 23 deadline provides Treasury time to consider the aluminum producer’s petition for delisting given the impact the April 6 sanctions have had on U.S. partners and allies. Additionally, Treasury stated that “OFAC will not impose secondary sanctions on non-U.S. persons for engaging in the same activity involving [the aluminum producer] or its subsidiaries that General License 14 authorizes U.S. persons to engage in.”
The same day, OFAC also issued an amended General License 12A to reflect the authorization in GL 14, and released several new FAQs addressing authorizations and limitations under GL 14.
Visit here for additional InfoBytes coverage on Ukraine/Russian sanctions.
OFAC sanctions Russian oligarchs and government officials; releases new general licenses and updated FAQs
On April 6, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced its decision to sanction seven Russian oligarchs along with 12 companies they own or control, 17 senior Russian government officials, and a state-owned Russian weapons trading company and its Russian bank subsidiary, pursuant to the Countering America’s Adversaries Through Sanctions Act of 2017 (CAATSA) and Executive Orders 13661, 13662, and 13582. In a foreign policy statement released the same day, President Trump explained that the identified persons placed on the Specially Designated Nationals (SDNs) and Blocked Persons List engaged in actions that have reportedly contributed to “advancing Russia’s malign activities,” including (i) profiting from “Russia's destabilizing activities”; (ii) election meddling; (iii) undermining U.S. cybersecurity; (iv) engaging in weapons proliferation; (v) continuing to occupy Crimea; (vi) instigating violence in eastern Ukraine; and (vii) providing military equipment and support for the Government of Syria's continued attacks against Syrian citizens. Pursuant to OFAC’s sanctions, all property or interests in property of the designated persons along with any other entity owned 50 percent or more by one or more designated persons that is within U.S. jurisdiction are blocked, and U.S. persons are “generally prohibited” from participating in transactions with these individuals and entities. Additionally, “non-U.S. persons could face sanctions for knowingly facilitating significant transactions for or on behalf of the individuals or entities blocked today.”
The same day, OFAC issued two Ukraine-/Russia-related general licenses to “minimize immediate disruptions to U.S. persons, partners, and allies.” General License 12 authorizes through June 5 certain activities necessary to “wind down” operations, contracts, or agreements in effect prior to April 6 involving specified blocked persons. General License 13 authorizes through May 7 divestiture transactions with certain blocked persons to a non-U.S. person, as well as the facilitation of transfers of debt, equity, or other holdings involving listed blocked persons by a non-U.S. person to another non-U.S. person. OFAC also released eight new FAQs related to this action and published one updated FAQ related to CAATSA.
Visit here for additional InfoBytes coverage on Ukraine/Russian sanctions.
OFAC sanctions Iranian nationals for malicious cyberattacks
On March 23, the Treasury Department’s Office of Foreign Assets Control (OFAC), in coordination with the DOJ, imposed additional sanctions on an Iranian entity and 10 Iranian nationals, pursuant to Executive Order 13694, for conducting malicious cyberattacks against hundreds of U.S. and third-country universities for private financial gain. Nine of the identified individuals are connected to the Mabna Institute and are accused of misappropriating “economic resources or personal identifiers” to aid Iran’s Islamic Revolutionary Guard Corps. Pursuant to these sanctions, all property or interests in property of the designated persons within U.S. jurisdiction are blocked, and U.S. persons are “generally prohibited” from participating in transactions with these individuals and entities. Additionally, as reported in a DOJ press release, the nine Iranians have also been indicted for engaging in malicious cyber-enabled activities. A tenth Iranian national was sanctioned for engaging in cyber-related actions targeting a U.S. media company.
Visit here for additional InfoBytes coverage on Iranian sanctions.
Treasury adjusts for inflation maximum civil monetary penalties assessed under OFAC sanction regulations
On March 19, the U.S. Treasury Department published a final rule in the Federal Register that adjusts for inflation the maximum amount of civil monetary penalties that may be assessed by the Treasury’s Terrorism Risk Insurance Program, Office of Foreign Assets Control, and Financial Crimes Enforcement Network for violations of laws administered by those agencies. The rule became effective immediately.
OFAC expands Russian sanctions in connection with election interference and cyber attacks
On March 15, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced its decision to sanction an additional five entities and 19 individuals, pursuant to Countering America’s Adversaries Through Sanctions Act of 2017 (CAATSA) and Executive Order 13694 (E.O. 13694). The CAATSA sanctions target “cyber actors” who carried out cyber attacks on behalf of the Russian government, while E.O. 13694 designations target entities and individuals who interfered with the 2016 U.S. election. Pursuant to OFAC’s sanctions, all property or interests in property of the designated persons within U.S. jurisdiction are blocked, and U.S. persons are “generally prohibited” from participating in transactions with these individuals and entities. As part of the announcement, Treasury Secretary Steven Mnuchin stated that “Treasury intends to impose additional CAATSA sanctions, informed by our intelligence community, to hold Russian government officials and oligarchs accountable for their destabilizing activities by severing their access to the U.S. financial system.”
The same day, OFAC amended General License No. 1, “Authorizing Certain Transactions with the Federal Security Service” and reissued it as “Cyber General License No. 1A” (GL 1A). OFAC also published four updated FAQs relating to the agency’s sanctions and GL 1A and CAATSA.
Visit here for additional InfoBytes coverage on Russian sanctions.
President Trump issues Executive Order prohibiting Venezuelan cryptocurrency transactions; OFAC sanctions additional Venezuelan officials
On March 19, President Trump issued Executive Order 13827 (E.O.) prohibiting transactions within the U.S. that involve any digital currency issued by, for, or on behalf of the Venezuelan government since January 9, and authorizing the U.S. Treasury Department to “employ all powers” necessary to carry out the E.O.’s provisions. President Trump issued the E.O. in conjunction with E.O. 13692 and E.O. 13808 and because of recent steps taken by Venezuelan President Maduro to “circumvent U.S. sanctions” by issuing a digital currency that the Venezuelan legislature “denounced as unlawful.” The E.O. took effect on March 19 at 12:15 p.m. EDT.
On the same day, the Treasury’s Office of Foreign Assets Control (OFAC) announced additional sanctions pursuant to E.O. 13692 against four current or former Venezuelan government officials as part of “ongoing efforts to highlight the economic mismanagement and endemic corruption that have been the defining features of the Maduro regime.” Pursuant to OFAC’s sanctions, all assets belonging to the designated persons within U.S. jurisdiction are blocked, and U.S. persons are “generally prohibited” from participating in transactions with these individuals. OFAC also published answers to several related FAQs concerning President Trump’s E.O., as well as new FAQs related to virtual currency.
Visit here for additional InfoBytes coverage on Venezuelan sanctions.
OFAC reissues North Korean Sanctions Regulations
On March 1, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) published a final rule in the Federal Register to amend and reissue the North Korea Sanctions Regulations in their entirety. The final rule implements Executive Orders 13687, 13722, and 13810, references the North Korea Sanctions and Policy Enhancement Act of 2016 and the Countering America’s Adversaries Through Sanctions Act of 2017, and provides the Treasury Secretary, “in consultation with the Secretary of State, additional tools to disrupt North Korea’s ability to fund its weapons of mass destruction and ballistic missile programs.” All property and interests in property of the Government of North Korea and the Workers’ Party of Korea are blocked, transactions by U.S. persons involving the sanctioned entities are generally prohibited, and “all transactions within the United States, including all financial transactions that transit the U.S. financial system, must comply with OFAC regulations.” Among other things, the final rule (i) incorporates several general licenses previously only available on OFAC’s North Korea Sanctions page; (ii) adds several new general licenses; (iii) adds and expands provisions to provide the public with a more comprehensive set of regulations; (iv) updates certain regulatory provisions; and (v) makes other technical and conforming changes. The final rule takes effect March 5, 2018. Also released the same day were updates to OFAC’s North Korea-related FAQs.
See here for previous InfoBytes coverage on North Korean sanctions.
OCC announces enforcement action against Washington-based bank citing BSA/AML compliance deficiencies
On February 28, the OCC issued a consent order against a Washington-based bank for deficiencies related to its Bank Secrecy Act/Anti-Money Laundering (BSA/AML) compliance program. The consent order requires the bank to, among other things, (i) maintain a Compliance Committee responsible for ensuring the bank adheres to the consent order’s provisions; (ii) appoint a BSA officer who will ensure compliance with the requirements of the BSA and the Office of Foreign Assets Control’s rules and regulations; (iii) implement an enhanced BSA/AML Risk Assessment Program, including the adoption of written policies to ensure the timely review of BSA/AML suspicious activity alerts and the implementation of an automated suspicious activity monitoring system; (iv) conduct a risk-based “Look-Back” to determine whether suspicious activity was timely identified and reported by the bank; (v) develop policies and procedures for enhanced customer due diligence to monitor information for risk; (vi) implement an independent BSA/AML audit program; and (vii) create a comprehensive training program for appropriate bank personnel. The bank did not admit to any wrongdoing in the consent order.
OFAC sanctions target North Korea’s shipping and trading industry
On February 23, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) imposed additional sanctions targeting the North Korean shipping and trading industry. The sanctions include the designation of 27 entities, 28 vessels, and one individual consistent with the Countering America’s Adversaries Through Sanctions Act of 2017. Treasury Secretary Steven T. Mnuchin stated, “Treasury is aggressively targeting all illicit avenues used by North Korea to evade sanctions, including taking decisive action to block the vessels, shipping companies, and entities across the globe that work on North Korea’s behalf. This will significantly hinder the Kim regime’s capacity to conduct evasive maritime activities that facilitate illicit coal and fuel transports, and erode its abilities to ship goods through international waters.” All property or interests in property held by the sanctioned individual and entities within U.S. jurisdiction must be blocked, and transactions between the designated persons and Americans are also prohibited.
Separately, OCAC issued a global shipping advisory in conjunction with the U.S. Department of State and the U.S. Coast Guard to, among other things, (i) outline methods employed by North Korea to facilitate illicit transactions to evade sanctions; (ii) list due diligence steps companies should employ to monitor illicit North Korean activity and mitigate the risk of potentially engaging in prohibited activity or transactions; and (iii) provide an overview of penalties associated with violating U.S. or UN sanctions.
See here for previous InfoBytes coverage on North Korean sanctions.