On Friday, the United States Department of the Treasury Office of Foreign Assets Control (OFAC) placed two new entities to the list of Specially Designated Nationals and Blocked Persons (SDN List) pursuant to the Zimbabwe sanctions. The U.S. sanctions program against Zimbabwe targets those individuals and entities engaged in the undermining of democratic processes in Zimbabwe. Often times these sanctions target those individuals in the diamond trading industry operating in the Marange diamond fields.

These new sanctions target Marange Resources Limited and Mbada Diamonds Limited, two privately held companies. Marange Resources is involved in the mining and sale of diamonds from the Marange diamond fields. Mbada Diamonds is a joint venture between the Zimbabwean government’s mining arm, the Zimbabwe Mining Development Corporation, and two South African companies, Grandwell Holdings and Core Mining. Mbada Diamonds is also involved in the mining of Marange diamonds. The Zimbabwe Mining Development Corporation was already designated and placed on the SDN List sometime ago. Now it seems likely that some of the other entities they are involved with the Zimbabwe Mining Development Corporation in mining the Marange diamond fields could be target by U.S. economic sanctions; particularly Grandwell Holdings and Core Mining.

Once placed on the OFAC SDN List, it takes quite a bit of time and investigation to have that designation removed. While there is an administrative process for removing these designations, access to U.S. federal courts for review of OFAC’s decisions is often limited for SDNs, because generally speaking they are foreign nationals with no nexus to the U.S. to assert standing in a U.S. court. As such, those seeking a reconsideration of their designation often have to ask the very same agency and investigators to change their mind; this is obviously a difficult task. Although, the OFAC SDN removal process is difficult it is not impossible and OFAC does fairly frequently reconsider decisions and delist SDNs. However, in order to pursue such a remedy, the targeted party should move quickly and undergo the process through the appropriate channels.

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.