The United States Department of the Treasury Office of Foreign Assets Control (OFAC) has designated former Côte d’Ivoire (Ivory Coast) President Laurent Gbagbo and his wife, Simone Gbagbo, as Specially Designated Nationals (SDNs) on allegations that their activities threaten the peace and national reconciliation process in Côte d’Ivoire. In addition to Mr. Gbagbo’s designation, three of his close associates–Desire Tagro, Pascal Affi N’Guessan, and Alcide Ilahiri Djedje– were also designated for carrying out activities on his behalf.

Parties designated under the Ivory Coast sanctions are deemed to constitute a threat to the peace and national reconciliation process in Côte d’Ivoire. In addition those parties acting on behalf of such persons, directly or indirectly may also be designated and isolated from the U.S. financial system. As a result of these designations, U.S. persons are prohibited from conducting financial or commercial transactions with the designated individuals, and any assets of the designees within U.S. jurisdiction are frozen.

According to OFAC, Former President Gbagbo’s has refused to accept the results of the November 28, 2010 run-off election between himself and Alassane Ouattara. This refusal has created a crisis in Côte d’Ivoire. It is the position of the United States Government that as a signatory to the 2005 Pretoria Agreement, Mr. Gbagbo pledged to ensure free, fair, and transparent elections in Côte d’Ivoire with UN participation. This commitment was reaffirmed in the 2007 Ouagadougou Political Agreement. OFAC justifies the designation by stating Mr. Gbagbo’s refusal to relinquish his authority undermines the implementation of these political agreements and threatens the peace and reconciliation process in Côte d’Ivoire.

Furthermore, the Treasury press release states:

“Desire Tagro has acted as Laurent Gbagbo’s chief-of-staff since the November election, and he was designated today for threatening the peace and national reconciliation process in Côte d’Ivoire and for acting for or on behalf of Gbagbo. Pascal Affi N’Guessan, Chairman of the Ivorian Popular Front, a political party founded by Laurent Gbagbo in 1982, has been acting as Gbagbo’s campaign spokesman during the 2010 election season and its aftermath, and Alcide Ilahiri Djedje, previously Côte d’Ivoire’s Permanent Representative to the UN, was selected as Gbagbo’s Minister of Foreign Affairs. N’Guessan and Djedje were designated today for acting for or on behalf of Gbagbo.”

OFAC has designated hundreds of individuals and companies over the last year alone. In addition, there are thousands of designated persons on the SDN List. If you are on the SDN List, then you need to challenge that designation before any more harm comes to your financial well being and your reputation. There are ways to do this, but you need to consult with legal counsel who has done this before and understands both the removal process and how OFAC operates.

Last week I wrote about the New York Times article which slammed The United States Department of the Treasury and the Office of Foreign Assets Control for providing licenses under the Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA) to individuals seeking to trade in agricultural commodities, medicine, and medical devices to Iran. This attack on the TSRA program was something that Undersecretary for Terrorism and Financial Intelligence Stuart Levey could not abide. Therefore, he responded with a letter to the Editor of the New York Times; a letter that was republished on The United States Department of the Treasury’s blog: Treasury Notes.

According to Levey, “…the Treasury Department had no discretion to deny authorizations in the large majority of cases reviewed by the article.” This is because Congress through TSRA allowed for the export of agricultural commodities, medicine, and medical devices. While this is true, Levey’s more poignant point was made when he stated:

“More generally, the article misses the forest for the trees. While reasonable people can debate whether certain items like chewing gum or salad dressing should be within the scope of the exemptions mandated by Congress, no credible observer believes that the export of a modest amount of food, medicine and other humanitarian items undermines our ability to pressure the Iranian regime.”

Well stated by the modern architect of U.S. economic sanctions. Although I don’t always agree with Mr. Levey or with the actions of OFAC, he is right in this regard; permitting such exports to Iran is not effecting the United States’ ability to deal with Iran. Moreover, it is my belief that prohibiting such exports would actually be contradictory to U.S. interests and to the spirit of Iran sanctions. As I mentioned in my blog posting last week a point being missed entirely by the New York Times article is the legacy that sanctions will leave behind. Even if the Islamic Republic fell tomorrow and the sanctions were removed, surely, Iranians will remember suffering under the weight of U.S. economic sanctions for the last 15 some years. How that will play into the stance towards the U.S. of any future government there could be problematic; even more so if OFAC had not been licensing exports of things such as agricultural commodities, medicine and medical devices. To say that electing to authorize exports of such articles is the result of choosing business interests over foreign policy considerations is absurd.

Although surprised that Treasury responded, I’m glad to see that they did. The New York Times article was unfair and misleading. While I applaud Treasury’s actions here, I’m sure myself and others in this field would like to see the blog used for more informative and educational purposes. As many readers of this blog know, blogs can be an important tool for educating and providing guidance on certain issues. It is my hope that Treasury will use their blog for that purpose as well and we see some solid guidance on OFAC issues come from it.

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 or ferrari@ferrari-legal.com.