Recent articles have been calling into question Thai Prime Minister Yingluck’s decision to appoint a Specially Designated National (SDN), Nalinee Taveesin, as her Office Minister over the National Identity Office. Ms. Taveesin is on the SDN List administered by the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) pursuant to the Zimbabwe Sanctions Regulations, due to her alleged facilitation of a number of financial, real-estate, and gem-related transactions on behalf of Grace Mugabe, Gideon Gono, and a number of other Zimbabwean Specially Designated Nationals (SDNs)”, according to a Treasury press release.

Despite her designation as an SDN, OFAC did concede that Ms. Taveesin has participated in a number of initiatives on corruption and growth challenges in Africa and Southeast Asia, although the agency maintained that she was simultaneously and secretly supporting the practices of the Mugabe regime. Ms. Nalinee has denied these allegations, stating her friendship with the Mugabe couple did not involve any business or financial transactions.

Prime Minister Yingluck has been widely criticized by the Thai media, opposition politicians, Americans and others for appointing Ms. Nalinee to her position. These parties have also called for Ms. Nalinee resign.

Ms. Nalinee is not the only high ranking foreign government official who is on the OFAC SDN List. Rostam Qasemi, Iran’s Oil Minister and the head of the Organization of Petroleum Exporting Countries (OPEC), is also on the OFAC SDN List pursuant to the Non-Proliferation of Weapons of Mass Destruction Sanctions. Moreover, John Harun Mwau, a popular member of the Kenyan Parliment is on the OFAC SDN List pursuant to the Foreign Narcotics Kingpin Designation Act.

The fact that individuals sanctioned by OFAC can still achieve and maintain high positions of authority in their respective countries seems to question the efficacy of those sanctions designations. However, due to my experience in representing blocked parties in reconsideration cases, I can assure you that these sanctions do have an impact and that the three (3) individuals indicated above seem to be the exceptions to the general rule that an OFAC designation will significantly damage a targeted party financially.

For U.S. persons it is important to remember that almost all dealings, directly or indirectly, with blocked parties are prohibited, unless licensed by OFAC. As such, dealing with those government offices or organizations which may lead to direct or indirect transactions with the OFAC SDN may lead to a violation. Thus, not only should U.S. persons proceed with caution when interacting with SDNs, but also with organizations or foreign government agencies which may be headed or controlled by SDNs.

It would be surprising to me that the government’s of these countries, with the exception of Iran, would not be actively lobbying the U.S. government to have their governmental officials removed from the list. If anyone knows if these parties are indeed seeking reconsideration of their OFAC SDN designations it would be interesting to hear about.

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.