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  • OFAC reaches settlement with Saudi Arabian bank to resolve Sudanese and Syrian sanctions violations

    Financial Crimes

    On December 28, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced a $653,347 settlement with a Saudi Arabian bank to resolve 13 apparent violations of the Sudanese Sanctions Regulations, or section 2(b) of Executive Order (E.O.) 13582, which prohibits certain transactions with respect to Syria. According to OFAC’s web notice, between 2011 and 2014, the bank processed—directly or indirectly—13 U.S. dollar (USD) transactions totaling more than $5.9 million “to or through the United States in circumstances where a benefit of [the bank’s] service was received by Sudanese or Syrian counterparties, or that involved goods originating in or transiting through Sudan or Syria.” OFAC noted that the apparent violations began after the bank had implemented more robust compliance measures, “including those relating to sanctions screening and OFAC sanctions compliance.”

    In arriving at the settlement amount, OFAC considered various aggravating factors, including that the bank “conferred substantial economic benefit to U.S.-sanctioned parties,” causing “significant harm to the integrity of U.S. sanctions programs and their associated policy objectives.”

    OFAC also considered various mitigating factors, including that the bank (i) did not willfully intend to violate U.S. sanctions law or recklessly disregard its sanctions obligations; (ii) cooperated with the investigation and signed a tolling agreement; and (iii) has undertaken remedial measures and has enhanced its compliance controls and internal policies, including by requiring the screening of all payments against international sanctions lists and prohibiting the opening of USD accounts for any Sudanese customers or financial institutions.

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

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  • OFAC Settles with International Insurance Group over Charges of Violating Sanctions Programs

    Financial Crimes

    On June 26, the Treasury’s Office of Foreign Asset Control (OFAC) reached a settlement with an international financial services and insurance company based in New York for alleged violations of OFAC sanctions programs. OFAC claimed that the company “issued policies and insurance certificates, and/or processed claims and other insurance-related transactions that conferred economic benefit to sanctioned countries or persons and undermined the policy objectives of several U.S. economic sanctions programs.” Specifically, OFAC maintained the company violated the following sanctions programs: (i) Iranian Transactions and Sanctions Regulations, 31 C.F.R. Part 560 (ITSR); (ii) Weapons of Mass Destruction Proliferators Sanctions Regulations, 31 C.F.R. Part 544 (WMDPSR); (iii) Sudanese Sanctions Regulations, 31 C.F.R. Part 538 (SSR); and (iv) Cuban Assets Control Regulations, 31 C.F.R. Part 515 (CACR). The settlement requires the company to pay $148,698 to settle the claims, which the company voluntarily self-disclosed to OFAC.

    For others to avoid these issues, OFAC suggested that “the best and most reliable approach for insuring global risks without violating U.S. sanctions law is to insert in global insurance policies an explicit exclusion for risks that would violate U.S. sanctions laws.”

    Financial Crimes Federal Issues OFAC Insurance Sanctions Risk Management Cuba Iran Sudan

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