Once a violation of sanctions laws takes place, OFAC has a designated process for enforcing violations.
OFAC will be reviewing apparent violations on a periodic basis in the context of each institution’s overall OFAC compliance program and specific OFAC compliance record.
Reviews include such factors as:
1) The opinion of a bank’s primary federal regulator;
2) The institution’s history of OFAC compliance;
3) The circumstances surrounding any apparent violation, including any patterns or weaknesses in an institution’s compliance program and whether those weaknesses indicate negligence or fundamental flaws;
4) Whether violations were voluntarily disclosed;
5) Enforcement information provided by the institution to OFAC;
6) The number of transactions or accounts that the institution handled improperly during the period under review and its responses to OFAC administrative subpoenas;
7) The number of transactions successfully blocked or rejected by the bank during the period; and
8) The actions taken by the bank to correct any violations and to ensure that similar violations do not recur.
After evaluating the information, OFAC will contact the bank to convey a preliminary assessment. OFAC’s staff will then discuss the results of its review. This review may include any patterns or compliance weaknesses and will indicate what administrative action OFAC intends to take for each transaction or set of related transactions that appear to constitute violations.
In the event that OFAC notifies a violator of its intent to pursue a civil penalty, existing civil penalty procedures under OFAC regulations will be followed, including the opportunity for informal settlement.
If you have any questions regarding OFAC violations and enforcement, reach out to an experienced Sanctions lawyer to learn more.