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OFAC Director Says Sanctions Driving Illicit Use of Couriers
printU.S. economic sanctions-the subject of perennial debate among policy wonks-have increasingly targeted specific individuals and organizations tied to terrorism, drugs and weapons proliferation in the last five years. The approach is now paying dividends, according to Adam Szubin, the director of the U.S. Treasury Department's Office of Foreign Assets Control. But while blacklists are working, in part because of better international cooperation, according to Szubin, financial institutions mandated to weed out prohibited transactions have voiced concerns about how the Treasury Department will wield new penalty powers that allow fines five times greater than those handed out last year. Szubin, who...
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When Congress enacted a law last year that increased the potential penalties for violating economic sanctions by five-fold, financial institutions had one question: how would the new penalty powers be used? Sparingly, says OFAC Director Adam Szubin, in the second part of a two-part interview.
The U.S. Treasury Department outlined Monday how it intends to enforce new penalty powers against U.S. financial institutions and other companies that violate economic sanctions.
Online transactions tied to sanctioned countries could lead to monetary fines for individuals, businesses and banks, even when it's unclear that the Web sites involved are blacklisted, say former OFAC officials and consultants.
Betsy Sue Scott, former head of the civil penalties division, says a recent increase of the maximum fines for OFAC violations will better fit the punishment to the crime. Violators previously were only receiving a "slap on the wrist" for serious offenses, she says.
The law, enacted last week, increases civil penalty amounts fivefold but will be used chiefly in the enforcement of "major cases," an OFAC official said Monday.