I’m a little late on this, as I have been on travel most of this week. However, The United States Department of the Treasury Office of Foreign Assets Control (“OFAC”) has released new enforcement guidelines which are full of great information for those finding themselves trying to make sense of various OFAC issues. My original plan was to do a series of blog postings on the major points of these guidelines. However, a good friend of mine over at Akin Gump Strauss Hauer & Feld, LLP, sent me a link to a news letter alert that they had put out on these guidelines. Therefore, I recommend everyone to read their take on the guidelines. That news letter alert can be found here.

The major points of clarification to take away from the guidelines relate to voluntary self disclosures, risk-based compliance, statute of limitation waivers and tolling agreements, compliance with foreign laws, sanctions history, Trading with the Enemy Act Maximum Penalties, and record keeping violation penalties.

The most interesting of these to me is that of the consideration of sanctions history. I’m primarily interested in seeing how it plays on in regards to individuals as opposed to entities. What the guidelines state is that OFAC will take into consideration a subject’s entire sanctions history, as opposed to the subject’s sanctions violations history, when determining an enforcement response to an apparent violation. OFAC also stated that it will consider a subject compliance history for the five years preceding the transaction giving rise to the apparent violation, so that a “first violation” is generally considered that which occurred in the preceding five years and not any that may have occurred previously.

I can understand viewing the compliance history for an entity, as they obviously should have some sort of program in place to avoid sanctions violations. However, can a compliance argument be made for an individual? Are they automatically deemed to be in compliance? Wouldn’t this also scare individuals off from voluntarily self-reporting past violations that might of gone unnoticed, in the event they are facing what OFAC deems as a first time violation? Please leave thoughts and comments in the comments section or email them to me.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC litigation. If you have any questions please contact him at 202-280-6370 at 202-351-6161 or ferrari@ferrari-legal.com.