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46-556: The Office of Foreign Assets Control ( OFAC ) is a financial intelligence and enforcement agency of the United States Treasury Department . It administers and enforces economic and trade sanctions in support of U.S. national security and foreign policy objectives. Under presidential national emergency powers , OFAC carries out its activities against foreign governments, organizations (including terrorist groups and drug cartels), and individuals deemed

92-686: A 1950 emergency with respect to the Korean War , a 1970 emergency regarding the postal workers strike , and a 1971 emergency in response to the government's deteriorating economic and fiscal conditions. Congress terminated these emergencies with the National Emergencies Act , and then passed the IEEPA to restore the emergency power in a limited, overseeable form. Unlike TWEA, IEEPA was drafted to permit presidential emergency declarations only in response to threats originating outside

138-550: A court order is required. As of October 7, 2015, the SDN List had more than 15,200 entries from 155 countries. Of those, 178 entries were for aircraft and 575 entries were for ships ("vessels"). The remaining 14,467 entries were for designated individuals and organizations. OFAC creates separate entries in the SDN list for each alias of a designee, so the number of entries does not reflect the number of designees. On September 21, 2021,

184-587: A cryptocurrency exchange was included in the sanctions list for first time for helping launder illicit funds having source from ransomware attacks. The amounts laundered are more than $ 160 million between 2018 and 2021. OFAC publishes a list of Sectoral Sanctions Identifications (SSI), which lists persons, companies, and entities in sectors of the Russian economy (especially energy, finance, and armaments), prohibiting certain types of activity with these individuals or entities by US persons, wherever located. This list

230-528: A culture, and of amounts that would not require reporting if in a conventional financial institution. IVTS also can be used for criminal purposes of avoiding oversight. Examples of financial intelligence analysis could include: At the highest level, US domestic FININT, and also some international work, comes under the Under Secretary of the Treasury for Terrorism and Financial Intelligence , heading

276-630: A financial organization. From a legal standpoint, this type of collection can be quite complex. For example, the CIA obtained access to the Society for Worldwide Interbank Financial Telecommunication (SWIFT) data streams through the Terrorist Finance Tracking Program , but this violated Belgian privacy law. Reporting requirements may not affect Informal value transfer systems (IVTS) the use of which may simply be customary in

322-491: A large volume of transactional data, usually provided by banks and other entities as part of regulatory requirements. Alternatively, data mining or data-matching techniques may be employed to identify persons potentially engaged in a particular activity. Many industrialized countries have regulatory reporting requirements for its financial organisations. It may be possible for the FININT organization to obtain access to raw data at

368-508: A record $ 963 million settlement with the French bank BNP Paribas , which was a portion of an $ 8.9 billion penalty imposed in relation to the case as a whole. Appointment as OFAC director is not subject to Senate confirmation. OFAC publishes a list of Specially Designated Nationals (SDNs), which lists people, organizations, and vessels with whom U.S. citizens and permanent residents are prohibited from doing business. This list differs from

414-727: A threat to U.S. national security. Founded in 1950 as the Division of Foreign Assets Control, since 2004 OFAC has operated under the Office of Terrorism and Financial Intelligence within the Treasury Department. It is primarily composed of intelligence targeters and lawyers. While many of OFAC's targets are broadly set by the White House , most individual cases are developed as a result of investigations by OFAC's Office of Global Targeting (OGT). Sometimes described as one of

460-583: Is executed by OFAC by issuing regulations that direct financial institutions accordingly. As part of its efforts to support the Iraq sanctions , in 2005, OFAC fined Voices in the Wilderness $ 20,000 for gifting medicine and other humanitarian supplies to Iraqis. In a similar case, OFAC imposed and attempted to collect a $ 10,000 fine, plus interest, against peace activist Bert Sacks for taking medicine to residents of Basra ; charges against Sacks were dismissed by

506-639: Is maintained following the issuance of EO 13662 Blocking Property of Additional Persons Contributing to the Situation in Ukraine on March 20, 2014, in accordance with 79 FR 16167. On August 13, 2014, the Treasury Department issued guidance for entities under sectoral sanctions. It increased the number of entities on the sectoral sanctions identifications list by adding subsidiaries of entities under sectoral sanctions that hold 50% or greater ownership by an entity under sectoral sanctions either individually or in

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552-618: The First Amendment . The Office of Foreign Assets Control (OFAC) under the U.S. Department of Treasury , however, interpreted this exemption narrowly to claim it held the right to prohibit any transactions associated with "informational materials not fully created and in existence at the date of the transaction." In response, the Berman-sponsored Free Trade in Ideas Act—passed by Congress in 1994—revised

598-595: The United Kingdom in retaliation for the impressment of American sailors. Predecessor agencies of the Division of Foreign Assets Control include Foreign Funds Control (FFC), which existed from 1940 to 1947, and the Office of International Finance (1947 to 1950). FFC was established by Executive Order 8389 as a unit of the Office of the Secretary of the Treasury on April 10, 1940. The authority to establish FFC

644-663: The United States which has its source in whole or substantial part outside the United States. The act was signed by President Jimmy Carter on December 28, 1977. In the United States Code , the IEEPA is Title 50, §§1701–1707. The IEEPA authorizes the president to declare the existence of an "unusual and extraordinary threat... to the national security, foreign policy, or economy of the United States" that originates "in whole or substantial part outside

690-472: The "most powerful yet unknown" government agencies, OFAC has the power to levy significant penalties against entities that defy its directives, including imposing fines, freezing assets, and barring parties from operating in the U.S. Involvement of the U.S. Department of the Treasury in economic sanctions against foreign states dates to the War of 1812 , when Secretary Albert Gallatin administered sanctions against

736-489: The 13 that he declared overall) relying primarily or exclusively on IEEPA authority during his 2017–21 term; Trump also used or threatened use of its powers in unconventional and unprecedented manners (including executive actions utilizing powers under the act that prompted legal challenges). On May 30, 2019, the White House announced that Trump would use IEEPA powers to introduce tariffs on Mexican exports in response to

782-817: The Office of Foreign Assets Control. In addition to the Trading with the Enemy Act and the various national emergencies currently in effect, OFAC derives its authority from a variety of U.S. federal laws , particularly the International Emergency Economic Powers Act (IEEPA), regarding embargoes and economic sanctions. In enforcing economic sanctions, OFAC acts to prevent "prohibited transactions", which are described by OFAC as "trade or financial transactions and other dealings in which U.S. persons may not engage unless authorized by OFAC or expressly exempted by statute". OFAC has

828-929: The Office of Terrorism and Financial Analysis, including: International financial activity comes primarily from the Department of the Treasury and the Central Intelligence Agency . See CIA access to the Society for Worldwide Interbank Financial Telecommunication (SWIFT). Following the September 11, 2001 attacks an allegation was made in The Wall Street Journal that tanzanite stones were being used as an untraceable currency and source of income for terrorists. This has not since been firmly established. See possible examples . The custom common in Africa, uncut diamonds tend to be

874-641: The Oregon-based Al Haramain Islamic Foundation in 2004 was unconstitutional. The court said the Fifth Amendment's guarantee of due process required Treasury to give adequate notice of the reasons it puts a group on the terrorist list, as well as a meaningful opportunity to respond. In addition, the court ruled that freezing the group's assets amounts to a seizure under the Fourth Amendment, so that

920-462: The President specifically finds their inclusion necessary. Congress enacted the IEEPA in 1977 to clarify and restrict presidential power during times of declared national emergency under the Trading with the Enemy Act of 1917 ("TWEA"). Under TWEA, starting with Franklin D. Roosevelt in 1933, presidents had the power to declare emergencies without limiting their scope or duration, without citing

966-947: The Southern District of New York granted a preliminary injunction blocking the sanctions in January 2021, through a challenge to the order brought by four dual-national American law professors and the Open Society Justice Initiative . (The Biden administration lifted the ICC sanctions in April 2021.) Also in September 2020, Trump used the IEEPA to order the removal of social media platforms TikTok and WeChat from U.S. app stores as well as prohibit domestic business transactions involving their respective China-based parent companies ByteDance and Tencent ;

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1012-480: The U.S. Treasury. In October 2001, Congress passed the USA PATRIOT Act which, in part, enhanced IEEPA asset blocking provisions under §1702(a)(1)(B) to permit the blocking of assets during the "pendency of an investigation." This statutory change gave the Treasury's Office of Foreign Assets Control the power to block assets without the need to provide evidence of the blocking subject's wrongdoing nor to permit

1058-523: The United States. Beginning with Jimmy Carter in response to the Iran Hostage Crisis , presidents have invoked IEEPA to safeguard U.S. national security interests by freezing or "blocking" assets of belligerent foreign governments, or certain foreign nationals abroad. In 1988, Congress passed amendments to the TWEA and IEEPA, authored by Rep. Howard Berman ( D – CA ), aimed at protecting

1104-438: The United States." It further authorizes the president, after such a declaration, to block transactions and freeze assets to deal with the threat. In the event of an actual attack on the United States, the president can also confiscate property connected with a country, group, or person that aided in the attack. IEEPA falls under the provisions of the National Emergencies Act (NEA) , which means that an emergency declared under

1150-448: The act must be renewed annually to remain in effect. The authority given to the President under the IEEPA does not grant them the ability to regulate or prohibit communication that "does not involve a transfer of anything of value"; imports or exports of information or any informational materials; and transactions incidental to travel. Donations intended to relieve human suffering, such as food, clothing or medicine are also excluded unless

1196-478: The aggregate, either directly or indirectly. Further, US persons cannot use a third party intermediary and must exercise caution during "transactions with a non-blocked entity in which one or more blocked persons has a significant ownership interest that is less than 50% or which one or more blocked persons may control by means other than a majority ownership interest." On December 22, 2015, the Treasury Department explicitly listed all entities and their subsidiaries on

1242-489: The app and, as also suggested by ByteDance in court documents pertaining to its lawsuit to overturn the order, a ticket reservation prank waged by some users of the video platform that depressed attendance for a campaign rally he held in Tulsa, Oklahoma that June. The executive order was blocked by federal courts in two separate cases on grounds that the sanctions likely violated IEEPA's informational materials exemption (under

1288-429: The authority to grant exemptions to prohibitions on such transactions, either by issuing a general license for certain categories of transactions, or by specific licenses issued on a case-by-case basis. Under the International Emergency Economic Powers Act (IEEPA), the U.S. President is empowered during national emergencies to block the removal of foreign assets under the jurisdiction of the United States. That mandate

1334-429: The blocking subject a chance to effectively respond to the allegations in court. Executing these blocking actions led to a series of legal cases challenging federal authority to indefinitely prevent charitable organizations from accessing their assets held in the United States. President Donald Trump used the IEEPA extensively, sanctioning more than 3,700 entities and invoking 11 national emergency declarations (out of

1380-519: The court in December 2012. In October 2007, a set of Spanish travel agency websites had their domain name access disabled by eNom : the domain names had been on the OFAC blacklist. When queried, the U.S. Treasury referred to a 2004 press release that claimed the company "had helped Americans evade restrictions on travel to Cuba". In the case of United States v. Banki , on June 5, 2010, a U.S. citizen

1426-522: The court's investigation into allegations of war crimes committed by the U.S. and Israel in Afghanistan and the Palestinian territories , respectively. Critics considered the order an effort to intimidate ICC civil servants from proceeding with its investigation and accused the administration of targeting the two prosecutors, both of African origin, based on their race. The U.S. District Court for

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1472-455: The de facto standard currency of the illicit small arms trade. Diamonds may be easily counted with a uniform valuation per carat to people in places of the world where there are no automated teller machines. An entire briefcase filled with uncut diamonds without the serial numbers found on refined precious metals can be used to make large illicit value transfers. The practice coexists with human trafficking, narcotics, weapons dealing, terrorism, and

1518-490: The entry of the People's Republic of China into the Korean War ; President Harry S. Truman declared a national emergency and tasked the Division with blocking all Chinese and North Korean assets subject to U.S. jurisdiction. The Division also administered regulations and orders issued under the amended Trading with the Enemy Act. On October 15, 1962, by a Treasury Department order, the Division of Foreign Assets Control became

1564-542: The evasion of economic sanctions and embargoes. However, the Internal Revenue Service has since instituted new anti-money laundering regulations to control the gem trade. Another intriguing possibility is that a terrorist might buy stocks which are likely to appreciate in the event of a terrorist attack, such as defense industry stocks, or sell short stocks which are likely to depreciate, such as airlines. This possibility led to many investigations of

1610-474: The financial markets subsequent to the September 11, 2001 attacks . International Emergency Economic Powers Act The International Emergency Economic Powers Act ( IEEPA ), Title II of Pub. L.   95–223 , 91  Stat.   1626 , enacted October 28, 1977 , is a United States federal law authorizing the president to regulate international commerce after declaring a national emergency in response to any unusual and extraordinary threat to

1656-655: The list maintained pursuant to Section 314(a) of the Patriot Act . In August 2009, a federal court ruling in KindHearts v. Treasury found that Treasury's seizure of KindHearts assets without notice or means of appeal is a violation of the Fourth and Fifth Amendments. On September 23, 2011, the Ninth Circuit Court of Appeals upheld a lower court's ruling that procedures used by Treasury to shut down

1702-688: The national security threat of illegal immigration from Mexico into the United States. As part of an ongoing trade war with China , on August 24, 2019, Trump tweeted that he "hereby ordered" U.S. companies to start looking at alternatives to China on the basis of claimed powers under IEEPA. Trump, however, did not formally declare an emergency as required by IEEPA. In September 2020, the Trump administration sanctioned and imposed visa restrictions on two International Criminal Court (ICC) officials, prosecutor Fatou Bensouda and Jurisdiction Complementarity and Cooperation Division Director Phakiso Mochochoko , over

1748-460: The newly established Office of International Finance (OIF). In 1948, OIF activities relating to blocked foreign funds were transferred to the Office of Alien Property, an agency within the Department of Justice . The Division of Foreign Assets Control, OFAC's immediate predecessor, was established in the Office of International Finance by a Treasury Department order in December 1950, following

1794-505: The non-exhaustive list of exempted materials was illustrative in nature, inferring that unlisted materials not yet invented or in wide use at the time of its passage would be prohibited from being subject to sanctions or other regulation under both acts. Following the September 11, 2001 terrorist attacks , President George W. Bush issued Executive Order 13224 under the IEEPA to block the assets of terrorist organizations. The President delegated blocking authority to federal agencies led by

1840-495: The original amendment's First Amendment exemptions to include newer and forthcoming mediums (including intangible items such as television broadcasts and methods of personal communication), further clarifying that the President's emergency sanction powers under the IEEPA and TWEA cannot be used with regard to any information or informational materials, regardless of their format or medium, or whether they are intended for personal or commercial use. The updated language also clarified that

1886-545: The relevant statutes, and without congressional oversight. The Supreme Court in Youngstown Sheet & Tube Co. v. Sawyer limited what a president could do in such an emergency, but did not limit the emergency declaration power itself. A 1973 Senate investigation found (in Senate Report 93-549 ) that four declared emergencies remained in effect: the 1933 banking crisis with respect to the hoarding of gold,

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1932-540: The restrictions would have become applicable to TikTok unless it was sold to an American company within 45 days of the executive order's issuance. Observers (including Trump administration critics and many TikTok users) raised First Amendment concerns with the executive order and suggested that, while national security concerns were cited to justify them, the sanctions were prompted by the administration's hostile relations toward China in general and retaliation against TikTok in particular for certain anti-Trump content hosted by

1978-471: The rights of American citizens to receive information, regardless of the country of origin of such materials used, by exempting varied methods of communication from regulation. The revisions to both acts, known collectively as the "Berman Amendment," restrict the President's authority to regulate or prohibit the importation or exportation of various forms of print, audio and video materials, artwork and other images, and other informational materials protected under

2024-584: The sectoral sanctions identifications list using a human readable search. As of August 8, 2020, OFAC was administering the following sanctions programs: Table note: The numbers of individuals, companies, vessels, and aircraft are taken from the SDN List . However, any single entry on that list may be a target of multiple sanctions programs, so summing lines of the table will inflate the true sum due to duplication. date 13464 13350 13460 13469 Financial intelligence FININT involves scrutinizing

2070-712: Was convicted of violating the Iran Trade Embargo for failing to request Iranian currency transfer licenses in advance from OFAC. On August 25, 2010, the Iranian American Bar Association announced that it would file an amicus curiae brief with the Court of Appeals for the Second Circuit on United States v. Banki . It has also hired lawyers to request further guidance from OFAC on import of goods from Iran. In 2014, OFAC reached

2116-623: Was derived from the Trading with the Enemy Act 1917 . Among other operations, FFC administered wartime import controls over enemy assets and restrictions on trade with enemy states. It also participated in administering the Proclaimed List of Certain Blocked Nationals , or the "Black List", and took censuses of foreign-owned assets in the US and American-owned assets abroad. FFC was abolished in 1947, with its functions transferred to

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