Money Laundering, Terrorism & Financial Institutions
Published by Civic Research Institute,

Mon, 9 Jun 2003 10:58:48 EDT
USA PATRIOT Act Monitor News Release: New OFAC Sanctions Rules

The Office of Foreign Assets Control has issued regulations to implement Executive Order 13224, adding a new Part 594 to 31 CFR Chapter V. The Executive Order blocked property and interests in property of foreign persons listed in an Annex to the Order, and prohibited transactions involving property blocked under the Order, including making or receiving any contribution of funds, goods, or services to a person designated in the Order. Written comments are requested, but the comment period will close August 5, 2003. Comments accompanied by a request for confidentiality of the submission will be returned without being considered, and comments will be posted on OFAC's website, Specially designated global terrorists are already designated as SDGTs on the SDN lists on OFAC's website.

Under interim final 31 CFR 594.201(b), any dealing in any security "held within the possession or control of a U.S. person and either registered or inscribed in the name of or known to be held for the benefit of any person whose property or interests in the property are blocked" is prohibited. This prohibition applies to dispositions, transportation, withdrawals, and to an endorsement or guaranty of signatures on any such security. Of particular concern to financial institutions is the following statement in the rule: "This prohibition applies irrespective of the fact that at any time (whether prior to, on, or subsequent to the effective date) the registered or inscribed owner of any such security may have or might appear to have assigned, transferred, or otherwise disposed of the security." This language appears in other sanctions regulations (e.g., regarding the Taliban) and is not likely to be eliminated by commenters' concerns.


< Back to News Releases List