On Thursday the United States Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) designated Iran’s intelligence ministry, Iranian Ministry of Intelligence and Security (“MOIS”), under three separate OFAC administered sanctions programs. MOIS was designated pursuant to the Global Terrorism Sanctions Regulations, the Syria Sanctions, and the Iranian Human Rights Sanctions. These designations place MOIS on the OFAC Specially Designated Nationals List (SDN) as [SDGT], [SYRIA], [IRAN-HR]. It is also presumed that an [IRAN] designation could apply since MOIS clearly seems to be a Government of Iran entity for purposes of the Iranian Transactions Regulations (ITR), which was made a blocking program pursuant to Executive Order 13,599. As with all entities and individuals blocked under an OFAC administered sanctions program, U.S. persons are prohibited from engaging in transactions with the designated entity and all assets which that entity own which come under the jurisdiction of the United States will be blocked.

The most interesting aspect of the designation was the fact that OFAC sought a designation of MOIS under the Syria program. Their reason for doing so was due to MOIS’ assistance to the Syrian Government in suppressing the protests that have been ongoing since last year. Moreover, MOIS’ funneling of funds to Hezbollah and Hamas served as the basis for designating MOIS under the global terrorism sanctions imposed by Executive Order 13,224.

Due to the often secret nature of MOIS, it may be difficult for U.S. persons to identify which transactions MOIS may have an interest in. Regardless, compliance officers should remain diligent in their efforts to catch transactions passing through the U.S. financial system which involve MOIS. In the event a U.S. person is subpoenaed to respond to an inadvertent transaction involving MOIS, it may make sense to argue that the secretive nature in which MOIS operates is a relevant factor for mitigation of any enforcement response.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrari-legal.com.