OFAC Amends Sanctions Programs to Reflect New IEEPA Penalty Provisions
The Office of Foreign Assets Control has issued a final rule1, effective June 10, 2008, amending the penalty provisions of 17 sanctions programs to reflect amendments made by Public Law 110-962 to the penalty provisions of the International Emergency Economic Powers Act (IEEPA).
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(P.L. 110-96 amended Section 206 of the IEEPA (50 USC 1705) in order to increase penalties against violators of sanctions law and revise the description of wrongful acts.)
Increased Civil Penalties, Revised Wrongful Acts Description
For each of the 17 IEEPA-based sanctions programs in 31 CFR (see list below), the final rule modifies the regulatory language on maximum civil penalties for violations to indicate that the applicable penalties may be found under Section 206 of the IEEPA (50 USC 1705.)
In addition, a note to the amended regulations for each of the 17 Parts of 31 CFR indicates that the revised maximum civil penalty is the greater of $250,000 or twice the amount of the transaction that is the basis of the violation with respect to which the penalty is imposed. (The prior civil penalty was up to $50,000 per violation.)
Revised description of wrongful acts. Civil penalties may be imposed on any person who violates, attempts to violate, conspires to violate, or causes a violation of any license, order, regulation, or prohibition issued under the IEEPA.
Increased Criminal Penalties, Revised Wrongful Acts Description
The final rule also amends the criminal penalty maximums under each of the 17 Parts so that upon criminal conviction, a person will be fined not more than $1,000,000; or if a natural person, may be imprisoned for not more than 20 years, or both. (The prior criminal penalty was up to $50,000 and 20 years imprisonment.)
Revised description of wrongful acts. Criminal penalties may be imposed upon a person who willfully commits, willfully attempts to commit, or willfully conspires to commit, or aids or abets in the commission of a violation of any license, order, regulation, or prohibition.
OFAC Plans to Post Revised Enforcement Guidelines to Web Site
OFAC plans to revise its enforcement guidelines shortly. The revised guidelines will be available on its Web site at http://www.treas.gov/offices/enforcement/ofac/index.html.
17 Sanctions Programs Amended by Final Rule
The final rule amends 31 CFR Parts 535, 536, 537, 538, 539, 540, 541, 542, 545, 560, 585, 586, 587, 588, 593, 594, and 595 to reflect the revised description of unlawful acts and the revised penalties prescribed by P.L. 110-96. These Parts correspond to the following sanctions regulations:
(1) Iranian Assets Control Regulations;
(2) Narcotics Trafficking Sanctions Regulations;
(3) Burmese Sanctions Regulations;
(4) Sudanese Sanctions Regulations;
(5) Weapons of Mass Destruction Trade Control Regulations;
(6) Highly Enriched Uranium (HEU) Agreement Assets Control Regulations;
(7) Zimbabwe Sanctions Regulations;
(8) Syrian Sanctions Regulations;
(9) Taliban (Afghanistan) Sanctions Regulations;
(10) Iranian Transactions Regulations;
(11) Federal Republic of Yugoslavia (Serbia and Montenegro) and Bosnian Serb-Controlled Areas of the Republic of Bosnia and Herzegovinia Sanctions Regulations;
(12) Federal Republic of Yugoslavia (Serbia and Montenegro) Kosovo Sanctions Regulations;
(13) Federal Republic of Yugoslavia (Serbia and Montenegro) Milosevic Sanctions Regulations;
(14) Western Balkans Stabilization Regulations;
(15) Former Liberian Regime of Charles Taylor Sanctions Regulations;
(16) Global Terrorism Sanctions Regulations; and
(17) Terrorism Sanctions Regulations.
1OFAC states that it did not issue a proposed rule as it is merely amending the penalty provisions of certain sanctions to conform with the statutory changes under P.L. 110-96.
2"The International Emergency Economic Powers Enhancement Act" signed into law in October 2007.
(See ITT's Online Archives or 10/23/07 news, 07102325, for BP summary of the President signing P.L. 110-96.
See ITT's Online Archives or 08/15/08 news, 06081515, for BP summary of the Bureau of Industry and Security amending its regulations to reflect the new civil penalties under IEEPA.)
OFAC contact - Assistant Director, Civil Penalties (202) 622-6140
OFAC final rule (FR Pub 06/10/08) available at http://edocket.access.gpo.gov/2008/pdf/E8-12385.pdf
OFAC press release available at http://www.treas.gov/offices/enforcement/ofac/actions/20080610.shtml
OFAC interim policy concerning IEEPA's implementation (posted 11/28/07) available at http://www.treas.gov/offices/enforcement/ofac/actions/20071128.shtml