Practices 
 

OFAC

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The Department of Treasury’s Office of Foreign Asset Controls (“OFAC”) administers financial and economic sanctions against specific countries in response to some form of wrong-doing. OFAC sanctions are targeted broadly against 1) foreign governments and political entities, 2) individuals and groups ranging from terrorists and drug cartels to banks and other financial institutes that support those types of activities, 3) entities such as charities linked to terrorism, and 4) certain activities such as those that would lead to nuclear proliferation or to trading in “blood diamonds.”   A U.S. person or company cannot do business in a manner that violates the OFAC sanctions by engaging in activities with those companies, governments or individuals that OFAC has prohibited.

 As of September 2011, there is a complete embargo, which means a ban on imports and exports (with some exceptions), on Cuba, Iran and most of Sudan. There are also partial or less comprehensive sanctions on other countries, for example Libya, North Korea, and Syria, in place. In addition, through the Foreign Assets Control Regulations, OFAC places specific sanctions on the property of certain people from specific countries, including from Cote D’Ivoire, the Balkans, Belarus, the Congo, Iraq, Somalia, Burma (Myanmar), Liberia, Lebanon, and Zimbabwe. 

 OFAC publishes a list of individuals and companies owned or controlled by, or acting for or on behalf of, targeted countries. It also lists individuals, groups, and entities, such as terrorists and narcotics traffickers designated under programs that are not country-specific. Collectively, such individuals and companies are called "Specially Designated Nationals" or "SDNs." Their assets are blocked and U.S. persons are prohibited from dealing with them. Both the sanctions programs and the SDN List are constantly changing and companies that do business internationally, particularly in political ‘hot spots’ are well advised to constantly monitor OFAC developments. 

OFAC’s sanctions apply to all U.S. citizens and permanent residents wherever they are located in the world. It also applies to any person who is physically in the United States regardless of his citizenship. U.S. companies and all branches of U.S. organizations throughout the world remain subject to OFAC. Likewise, U.S. branches or offices (physically located in the U.S.) of foreign corporations are subject to OFAC. When dealing with Cuba, the reach of OFAC is even longer. Not only are corporations or companies actually located in the U.S. subject to the embargo but also included are foreign organized subsidiaries of U.S. corporations. In addition, many of the OFAC sanctions programs also prohibit “facilitating” i.e. assisting, a prohibited transaction.

Attorneys at Barnes, Richardson are well versed in sanction law and can provide guidance on how to tailor transactions, including financial transactions, so they remain complaint with the OFAC law. Barnes, Richardson attorneys assist companies in all areas of OFAC compliance, including building and auditing robust OFAC compliance programs, preparing and submitting voluntary disclosures to OFAC, and engaging in other representations before that agency. 

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