Authority and Activities
In addition to the Trading with the Enemy Act and the various national emergencies currently in effect, OFAC derives its authority from a variety of U.S. federal laws regarding embargoes and economic sanctions.
In enforcing economic sanctions, OFAC acts to prevent "prohibited transactions," which are described by OFAC as trade or financial transactions and other dealings in which U.S. persons may not engage unless authorized by OFAC or expressly exempted by statute. OFAC has the authority to grant exemptions to prohibitions on such transactions, either by issuing a general license for certain categories of transactions, or by specific licenses issued on a case-by-case basis. OFAC administers and enforces economic sanctions programs against countries, businesses or groups of individuals, using the blocking of assets and trade restrictions to accomplish foreign policy and national security goals. See United States embargoes for a list of affected countries.
Under the International Emergency Economic Powers Act (IEEPA), the President of the United States is empowered during national emergencies to block the removal of foreign assets under the jurisdiction of the United States. That mandate is then executed by OFAC through issue of regulations that direct financial institutions accordingly.
Between 1994 and 2003, OFAC collected over $8m in violations of the Cuban embargo, against just under $10,000 for terrorism financing violations. It had ten times more agents assigned to tracking financial activities relating to Cuba than to Osama Bin Laden.
As part of its efforts to support the Iraq sanctions, in 2005 OFAC fined Voices in the Wilderness $20,000 for gifting medicine and other humanitarian supplies to Iraqis. In a similar case, OFAC is still attempting to collect (as of 2011) a $10,000 fine, plus interest, against Bert Sacks for bringing medicine to residents of Basra.
In October 2007, a set of Spanish travel agency websites had their domain name access disabled by eNom: the domain names had been on the OFAC blacklist. When queried, the United States Treasury referred to a 2004 press release that claimed the company "had helped Americans evade restrictions on travel to Cuba".
In the case of United States v. Banki, on June 5, 2010, a U.S. citizen was convicted of violating the Iran Trade Embargo for failing to request Iranian currency transfer licenses in advance from OFAC. On August 25, 2010, the Iranian American Bar Association announced that it would file an amicus curiae brief with the United States Court of Appeals for the Second Circuit on United States v. Banki. It has also hired lawyers to request further guidance from OFAC on import of goods from Iran.
Read more about this topic: Office Of Foreign Assets Control
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