Today the United States Department of the Treasury Office of Foreign Assets Control (OFAC) designated a number of individuals under the Foreign Narcotics Kingpin Designation Act (Kingpin Act) and its corresponding regulations. According to OFAC, these designations are linked to purported Lebanese narcotics trafficker Ayman Joumaa, as well as nine individuals and 19 entities connected to his drug trafficking and money laundering organization.

OFAC believes that Joumaa and his organization operate in Lebanon, West Africa, Panama and Colombia, and launder proceeds from their illicit activities – as much as $200 million per month – through various channels, including bulk cash smuggling operations and Lebanese exchange houses. As readers of this blog will know, due to these designations U.S. persons are prohibited from conducting financial or commercial transactions with these individuals and entities and any assets the designees may have under U.S. jurisdiction are frozen.

The parties designated today include three Lebanon-based money exchanges allegedly used by Ayman Joumaa and his organization to launder illicit proceeds: the Hassan Ayash Exchange Company, the Ellissa Exchange Company, and New Line Exchange Trust Co. OFAC also targeted Hassan Ayash, Hassan Mahmoud Ayache, Jamal Mohamad Kharoubi, Ali Mohammed Kharroubi, Ismael Mohammed Youssef, and Ziad Mohamad Youssef for their roles in these money exchanges.

Akram Saied Joumaa, the CEO and general manager of Caesar’s Park Hotel, was also designated today. OFAC alleges that the organization use Caesar’s Park Hotel as a location to broker drug trafficking and money laundering activities.

Also designated were Lebanon-based company Phenicia Shipping Offshore SARL, Panama-based companies Goldi Electronics S.A. and Zona Libre International Market S.A., and Colombia-based companies Almacen Junior, Almacen Junior No. 2 and Commercial Planeta. These designations were all made due to the entities being owned or controlled by members of the Ayman Joumaa organization.

These designations were the result of a Drug Enforcement Administration investigation of the Joumaa organization, and highlight OFAC’s ongoing efforts to apply financial measures against significant foreign narcotics traffickers worldwide. In addition to other penalties, criminal penalties for corporate officers found to have violated the Kingpin Act may include up to 30 years in prison and fines up to $5 million.

OFAC SDN List removals are an administrative matter and require the designated party to establish that either their placement on the SDN List was made in error or that the circumstances which initially led to the designation have changed. These matters can be addressed effectively by counsel who has experience in dealing with OFAC and with SDN List removals in particular.

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.