Over a year ago, I wrote a couple of blog postings regarding the growing concerns of the U.S. Government surrounding Venezuela’s ties to the FARC and to Iran. I had noted that, as a result of these concerns, it could be possible that Venezuela could come under increased scrutiny for sanctioning from the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC). As readers of this blog know OFAC has designated several Venezuelans for sanctions, placing those individuals on the OFAC Specially Designated Nationals and Blocked Persons List (SDN List).

On Monday, OFAC Director Adam Szubin gave an interview which confirmed OFAC’s and the U.S. Government’s concern over current activities in Venezuela and the possibility of new sanctions. Szubin also indicated the manner in which those placed on the list can be removed, describing the OFAC SDN administrative reconsideration process set forth in 31 C.F.R. 501.807. Szubin noted that in the last three (3) years over 400 parties had been removed from the OFAC SDN List.

As late as last week the OFAC SDN List contained 258 references to “Venezuela”. This includes designated companies, organizations and persons. According to Szubin, there is a disturbing trend in Venezuela that is leading to the designation of numerous parties under the Foreign Narcotics Kingpin Designation Act (Kingpin Act). This trend has lead to the designations of Venezuela’s current Defense Minister Henry Rangel Silva and the former head of Military Intelligence Hugo Armando Carvajal Barrios.

Szubin stated that Rangel Silva’s designation occurred because of his alleged provision of material assistance to drug trafficking activities of the Revolutionary Armed Forces of Colombia (FARC), another OFAC designated entity. Furthermore, Szubin cited Rangel Silva’s call for greater cooperation between the Government of Venezuela and the FARC as a basis for the designation.

Szubin went on to indicate that members of Specially Designated Global Terrorist organization, Hezbollah, were living in Venezuela. These individuals are Ghazi Nasr Aldin and Fawzi Kan’an. It was also stated that Kan’an owns two travel agencies in Venezuela. Moreover, he noted that two Venezuelan entities, the International Bank for Development Program and Petropars, were designated due to their ties with Iran.

In light of Szubin’s interview it seems that my suspicions from a year ago are confirmed and that OFAC is and has been indeed looking closely at Venezuela as a new hotbed for sanctionable activity. While there hasn’t been any public discussion of a country based sanctions program targeting Venezuela, it could one day come to that as OFAC is clearly concerned about ongoing activities in Venezuela on a variety of fronts. Will the culminations of Venezuela’s ties to designated SDN narco-trafficking organizations, their support for Iran, and their harboring of designated terrorists lead to a full scale OFAC administered sanctions program targeting Venezuela? Only time will tell.

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.