OFAC Continues Iran Designations Despite COVID-19 Outbreak
Despite most of the world being in self-quarantine mode to prevent the spread if COVID-19, the United States Department of the Treasury’s Office of Foreign Assets Control (“OFAC”)–as well as the United States Department of State–have continued their work of targeting Iranian individuals and companies, as well as those acting for or on their behalf or providing support or services to them, under various sanctions programs. Indeed, this past Thursday, OFAC targeted 20 Iran and Iraq-based individuals and companies under E.O. 13224 for alleged links to the Islamic Revolutionary Guards Corps-Quds Force (“IRGC-QF”) and other sanctioned organizations.
In perhaps a sign of the times, Secretary Mnuchin–after citing Treasury’s belief that Iran is employing a web of front companies to fund alleged terrorist groups across across the region, at the purported expense of the Iranian people–noted that the U.S. sanctions authorities maintain authorizations and exemptions for the provision of humanitarian aid to Iran in order to combat COVID-19.
Today’s post, however, is neither intended to criticize nor commend the continued use of sanctions authorities against Iran during this time. Rather, is to intend to begin–what I hope to be a new routine practice at SanctionLaw–cataloging the types of conduct that OFAC deems sanctionable under various sanctions authorities. The reason for doing so stems from the fact that, as more sanctions authorities are added, we are getting more and more questions about what type of conduct can be deemed sanctionable. Turning to the legal authorities alone is not entirely helpful, as the authorities are broadly written and often vague. Reviewing the designation action press releases is helpful, however, in determining the type of conduct that is sanctionable–that is, of course, if you know how to parse their language to separate what identifies sanctionable conduct from that which is merely non-relevant, additional derogatory information.
We’ll start this new practice with Thursday’s designation action referenced above.
| Person | Person | Authority | Alleged Conduct |
| Reconstruction Organization of the Holy Shrines of Iraq (“ROSHI”) | Entity | E.O. 13224, §1(a)(iii)(A)–Owned or Controlled by person blocked under E.O. 13224 | 1. Leadership appointed by IRGC-QF Official. 2. Transferred funds to other IRGC-QF controlled entities 3. IRGC-QF officials have used its funds to supplement IRGC-QF budgets |
| Bahjat al Kawthar Company for Construction and Trading, Ltd. a/k/a Kosar Company | Entity | E.O. 13224, §1(a)(iii)(A)–Owned or Controlled by person blocked under E.O. 13224 | 1. Received transfers of funds from ROSHI and the Central Bank of Iran–both designated under E.O. 13224 for being owned or controlled by the IRGC-QF or providing support to IRGC-QF and Lebanese Hizballah, respectively. |
| Mohammad Jalal Maab | Individual | E.O. 13224, §1(a)(iii)(E)–Being a leader or official of a person blocked under E.O. 13224. | 1. Being the current head of ROSHI, an entity designated under E.O. 13224. |
| Hassan Pelarak | Individual | E.O. 13224, §1(a)(iii)(A)–having acted or purported to act on behalf of a person blocked under E.O. 13224. | 1. IRGC-QF Officer. 2. Co-owner of Kosar Company–an entity designated under E.O. 13224. 3. Selected to serve as Ghassem Soleimani’s special assistant on IRGC-led Committee focused on sanctions evasion activity. 4. Worked with IRGC-QF officials to transfer arms to Yemen. |
| Alireza Fadakar | Individual | E.O. 13224, §1(a)(iii)(A)–having acted or purported to act on behalf of a person blocked under E.O. 13224. | 1. Co-owner of Kosar Company–an entity designated under E.O. 13224. 2. IRGC-QF Commander in Najaf, Iraq. |
| Muhammad al-Ghorayafi | Individual | E.O. 13224, §1(a)(iii)(C)–having providing support or services to a person blocked under E.O. 13224. | 1. Employee of Kosar Company who provides administrative support to Alireza Fadakar. |
| Masoud Shoushtaripousti | Individual | E.O. 13224, §1(a)(iii)(A)–having acted or purported to act on behalf of a person blocked under E.O. 13224. | 1. Co-owner of Kosar Company. 2. Laundered money on behalf of IRGC-QF. |
| Mashallah Bakhtiari | Individual | E.O. 13224, §1(a)(iii)(C)–having providing support or services to a person blocked under E.O. 13224. | 1. Worked with officials at the Baghdad Branch of Melli Bank to deposit funds for the IRGC-QF. |
| Al Khamael Maritime Services (“AKMS”) | Entity | E.O. 13224, §1(a)(iii)(A)–Owned or Controlled by person blocked under E.O. 13224 | OFAC’s Press Release is not clear as to what the sanctionable conduct is, other than to say that the IRGC-QF has a financial interest in AKMS which operates out of Umm Qasr port. OFAC does allege the IRGC-QF’s leveraging of Iraqi militia groups’ contacts in the Iraqi government to evade inspection protocol and charge fees at the port, however, OFAC does not allege what involvement AKMS has in such activity, nor does it otherwise identify how the IRGC-QF has a financial interest in AKMS. |
| Hasan Saburinezhad (aka “Engineer Morteza”) | Individual | E.O. 13224, §1(a)(iii)(A)–having acted or purported to act on behalf of a person blocked under E.O. 13224. | 1. Representative of AKMS, where he allegedly facilitates entry into Iraqi ports to facilitate the entry of Iranian shipments into those ports for the benefit of IRGC-QF. 2. Involved in in IRGC-QF’s financial and economic activities through smuggling through the Iraq-Syria border. 3. Involved in the IRGC-QF’s smuggling of goods from Iran into Iraq. 4. Managing Director and member of the Board of Directors of Mada’in Novin Traders, an Iran and Iraq based company associated with multiple IRGC-QF officials, including Vali Golizadeh. |
| Mada’in Novin Traders | Entity | E.O. 13224, §1(a)(iii)(A)–being owned or controlled by, or having acted or purported to act on behalf of a person blocked under E.O. 13224. | 1. Entity associated with multiple IRGC-QF officials, including Vali Golizadeh |
| Vali Golizadeh | Individual | E.O. 13224, §1(a)(iii)(E)–Being a leader or official of a person blocked under E.O. 13224. | 1. Being an official of Mada’in Novin Traders. |
| Mohammad Saeed Odhafa al Behadili | Individual | E.O. 13224, §1(a)(iii)(A)– having acted or purported to act on behalf of a person blocked under E.O. 13224. | 1. Being the Managing Director of AKMS. |
| Ali Hussein Falih Al-Mansoori (aka “Seyed Rezvan”) | Individual | E.O. 13224, §1(a)(iii)(E)–Being a leader or official of a person blocked under E.O. 13224. | 1. Being Deputy Managing Director and head of the board of directors of AKMS. 2. Working with IRGC-QF officials on business issues related to AKMS. |
| Sayyed Reza Musavifar | Individual | E.O. 13224, §1(a)(iii)(C)–having providing support or services to a person blocked under E.O. 13224. | 1. Responsible for accounts and finances of AKMS, and has worked with IRGC-QF to transfer funds to Lebanese Hizballah and Kata’ib Hizballah. 2. In 2014, transferred the equivalent of millions of dollars in foreign currency to IRGC-QF officials. |
| Middle East Saman Chemical Company | Entity | E.O. 13224, §1(a)(iii)(A)–being owned or controlled by a person blocked under E.O. 13224. | 1. One of the owners is Sayyed Reza Musavifar (see above). |
| Ali Farhan Asadi | Individual | E.O. 13224, §1(a)(iii)(C)–having providing support or services to a person blocked under E.O. 13224. | OFAC press release states designation is for providing support or services to AKMS, but does not identify the sanctionable conduct underlying that determination. |
| Sayyed Yaser Musavir | Individual | E.O. 13224, §1(a)(iii)(A)– having acted or purported to act on behalf of a person blocked under E.O. 13224. | 1. Since 2014, has extensively been deployed to Iraq in support of the IRGC-QF, and has allegedly coordinated operations between IRGC-QF and Iraqi militia groups. 2. In 2019, Musavir allegedly coordinated with IRGC-QF officials to sell petroleum products to Syria. 3. Allegedly coordinated propaganda efforts with Asa’ib Ahl al Haq on behalf of IRGC-QF officials. |
| Mehdi Ghasemzadeh | Individual | E.O. 13224, §1(a)(iii)(A)– having acted or purported to act on behalf of a person blocked under E.O. 13224. | 1. Being an IRGC-QF Official. |
| Shaykh ‘Adnan al-Hamidawi | Individual | E.O. 13224, §1(a)(iii)(A)– having acted or purported to act on behalf of a person blocked under E.O. 13224. | 1. Special Operations Commander of Kata’ib Hizballah who allegedly, in 2019, planned to intimidate Iraqi politicians who did not support removal of U.S. forces from Iraq. |
Hopefully, this table, and those that we hope to create in the future, will help compliance professionals undertake more precise risk assessments as to what constitutes sanctionable behavior under a particular sanctions authority, and will help the parties that have been designated more readily address or remediate the conduct that led to the designation.
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@falawpc.com.
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1 Comments
Excellent job.
As rightly mentioned such info graph is a good guide for compliance departments , and I will share it either . This is also useful to be incorporated in the Compliance Applications.
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