Every transaction that a U.S. financial institution engages in is subject to OFAC regulations. If a bank knows or has reason to know that a target is party to a transaction, the bank's processing of the transaction would be unlawful.
OFAC ReportingIf a transaction is blocked or prohibited, a bank must report it to the OFAC within 10 business days. The blocked assets (as of June 30) must also be reported annually by September 30. Once any assets are blocked, they must be placed in a separate, blocked account.
All individuals, banks, financial services companies and other obligated institutions operating under United States jurisdiction must comply with OFAC sanctions.
Specially Designated Nationals And Blocked Persons List (SDN) Human Readable Lists. Collectively, such individuals and companies are called "Specially Designated Nationals" or "SDNs." Their assets are blocked and U.S. persons are generally prohibited from dealing with them.
The OFAC guidelines, effective from 3 September 2009, allow persons in the US to send remittances to close relatives in Cuba. Western Union currently has 3,000 agent locations authorized to send Western Union money transfers from the US to Cuba, and more than 100 agent locations in Cuba.
Currently, sanctioned countries include the Balkans, Belarus, Burma, Cote D'Ivoire (Ivory Coast), Cuba, Democratic Republic of Congo, Iran, Iraq, Liberia, North Korea, Sudan, Syria, and Zimbabwe. The list of sanctioned countries is updated periodically and is available here.
The Bureau of Industry and Security (BIS) implements U.S. Government certain sanctions against Cuba, Iran, North Korea, and Syria pursuant to the Export Administration Regulations (EAR), either unilaterally or to implement United Nations Security Council Resolutions.
OFAC blocks property with the intent to deprive targeted countries and Specially Designated Nationals of the funds and materials used to further their aims which threaten to harm the national security or foreign policy of the United States.
Contact us by Telephone
| ?Toll Free Hotline Number | 1-800-540-6322? |
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| ?Local Hotline Number | ?1-202-622-2490 |
| ?OFAC Licensing Division (Direct Number) | ?1-202-622-2480 |
A blocking statute is a law of one jurisdiction intended to hinder application there of a law made by a foreign jurisdiction. A blocking statute shields companies in its jurisdiction against sanctions by prohibiting them from respecting the sanctions, and not recognising foreign court rulings enforcing them.
OFAC Attorney: A person engaging in any transaction that is subject to U.S. economic sanctions must keep full and accurate records of each such transaction for a period of five years from the date of the transaction.
To determine whether or not a transaction will be rejected or blocked, pay close attention to who has an interest in the transaction. If an OFAC SDN has an interest in the transaction then the funds will be blocked and it will be an uphill battle to have them unblocked.
OFAC requires the retention of all reports and blocked or rejected transaction records for five years.
All companies and individuals in the United States must comply with trade sanctions and regulations determined by the OFAC. If your company is in an international industry, finance, or insurance, an OFAC check is a great addition to your background check.
Credit bureaus and agencies in particular have adopted new measures to ensure compliance with OFAC regulations. Before issuing a credit report, they use screening software to determine if a credit applicant is on OFAC's Specially Designated Nationals (SDN) list or one of OFAC's other sanctions lists.
You can look up a person's or company's name in an OFAC search on the U.S. Treasury's website. All documents are public and easy to access. They are updated when necessary and there are records of post information. There will be a check on the person's or company's name against the Specially Designated National list.
The BSA/OFAC Officer is responsible for developing, implementing, administering, and monitoring all aspects of the Credit Union's BSA/AML/OFAC Compliance Program. The individual is expected to be knowledgeable in all aspects of BSA/AML/OFAC.
Transactions that are Subject to OFAC
- Deposit (checking & savings) accounts.
- Loans.
- Credit Cards.
- Wire transfers.
- ACH transfers.
- Lines of credit.
- Trust accounts.
- Loan payments.
