OFAC Publishes Final Rule with Increased IEEPA Penalties

June 11, 2008

The Treasury Department's Office of Foreign Assets Control ("OFAC") has issued a  final rule amending its regulations to reflect amendments made to the penalty provisions of the International Emergency Economic Powers Act ("IEEPA") made by the International Emergency Economic Powers Enhancement Act of 2007.  The amendments reflected in this final rule affect 17 parts within Chapter 31 of the Code of Federal Regulations ("CFR") which OFAC administers.  The final rule modifies the regulatory language regarding the civil penalties for violations of the sanctions to indicate that the applicable penalties may be found at 50 U.S.C. 1705. 

These amendments represent technical changes to the regulations in light of the substantial increase in civil penalty authority which resulted from the  International Emergency Economic Powers Enhancement Act of 2007, Pub L. 110-96, which was signed into law by President Bush on October 16, 2007.  As  previously reported on this website, inter alia, the Act amended section 206 of IEEPA (50 U.S.C. 1705) by increasing the maximum civil penalty for IEEPA violations to an amount not to exceed the greater of $250,000 or an amount twice the amount of the transaction that is the basis for the violation.  The Act also amended IEEPA's provisions relating to the imposition of criminal penalties.

OFAC has indicated that it will publish substantive revisions to the enforcement guidelines which it currently uses to administer its enforcement and civil penalty programs.  It has been reported that those revisions remain in progress and OFAC anticipates publishing them in the near future.

Additional updates on the revised enforcement guidelines will be posted on this website as they become available.