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  • FinCEN issues advisory on Iranian efforts to evade U.S. sanctions

    Financial Crimes

    On October 11, the Financial Crimes Enforcement Network (FinCEN) issued an advisory for financial institutions on ways to help better detect and report the Iranian regime's efforts to evade U.S. sanctions through potentially illicit transactions. The advisory outlines deceptive practices used by the Iranian regime to evade sanctions, including front companies, fraudulent documents, transactions involving exchange houses, falsified shipping documents, and the use of virtual currencies, and warns financial institutions that FinCEN expects Iran to expand use of these practices following the November 5 return of sanctions previously suspended as part of the Joint Comprehensive Plan of Action. (See previous InfoBytes coverage here on Executive Order 13846, issued last August reimposing sanctions against Iran.) The advisory also includes a series of red flags to help banks identify possible deceptive activity, and provides information for filing suspicious activity reports. FinCEN advises foreign financial institutions to consult the advisory to “better understand the obligations of their U.S. correspondents, to avoid exposure to U.S. sanctions, and to address the Anti-Money Laundering/Combating the Financing of Terrorism risks that Iranian activity poses to the international financial system.”

    See here for continuing InfoBytes coverage of actions related to Iran.

    Financial Crimes FinCEN Iran Anti-Money Laundering Combating the Financing of Terrorism Sanctions Executive Order

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  • President Trump issues Executive Order delegating sanctions implementation authority; OFAC issues new CAATSA - Russia-related FAQ

    Financial Crimes

    On September 20, President Trump announced the issuance of Executive Order 13849 (E.O. 13849), “Authorizing the Implementation of Certain Sanctions Set Forth in the Countering America’s Adversaries Through Sanctions Act (CAATSA),” pursuant to national emergencies previously declared in Executive Orders 13660, 13694, and 13757. E.O. 13849 grants authority to the Secretary of the Treasury to take certain actions to implement the sanctions against identified persons, including the promulgation of regulations. Among other things, E.O. 13849 prohibits: (i) any U.S. financial institution from making loans or extending credits to sanctioned persons “totaling more than $10,000,000 in any 12-month period, unless the person is engaged in activities to relieve human suffering and the loans or credits are provided for such activities”; (ii) any foreign exchange transactions, subject to U.S. jurisdiction, in which the sanctioned person has any interest; and (iii) transfers of credit or payments between, by, or through financial institutions for the benefit of a sanctioned person subject to U.S. jurisdiction. E.O. 13849 further describes the actions that can be taken to implement the sanctions.

    In response to E.O. 13849, the U.S. Treasury Department’s Office of Foreign Assets Control published a new CAATSA - Russia-related FAQ providing additional clarifying information.

    Find continuing InfoBytes covered on CAATSA-related sanctions here.

    Financial Crimes Department of Treasury OFAC CAATSA Russia Executive Order

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  • President Trump issues Executive Order authorizing sanctions in the event of foreign interference in U.S. elections

    Financial Crimes

    On September 12, President Trump announced the issuance of Executive Order 13848 (E.O.), which authorizes sanctions against foreign persons found to have engaged in, assisted, or otherwise supported foreign interference in U.S. elections. Should an intelligence assessment determine such activity has occurred, Section 2 of the E.O. requires that transactions in property and interests of such interfering persons that are in the U.S. or under control of a U.S. person be blocked, and Section 3 of the E.O. directs the Secretaries of State and Treasury—in consultation with the heads of other appropriate agencies—to recommend to the President additional sanctions against “the largest business entities licensed or domiciled in a country whose government authorized, directed, sponsored, or supported election interference, including at least one entity from each of the following sectors: financial services, defense, energy, technology, and transportation.” Such additional sanctions may include, with respect to the targeted entities, (i) blocking all transactions related to property and interests subject to U.S. jurisdiction; (ii) prohibitions on U.S. financial institutions making loans or extending credit to identified entities; (iii) prohibitions on transfers of credit or payments between, by, or through financial institutions for the benefit of such an entity; and (iv) prohibitions on U.S. persons investing in equity or debt of such entities.

    Financial Crimes OFAC Department of Treasury Sanctions Executive Order Trump

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  • OFAC adds North Koreans to Specially Designated Nationals List

    Financial Crimes

    On September 6, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) made additions to the Specially Designated Nationals List pursuant to Executive Order (E.O.) 13722. OFAC’s additions to the designations identify one individual and one entity found to have “engaged in significant activities undermining cybersecurity through the use of computer networks or systems against targets outside of North Korea” on behalf of the Government of North Korea. OFAC cites to the individual’s participation in a 2016 cyber-enabled fraudulent transfer of $81 million, a 2017 ransomware attack, and the 2014 cyber-attack against a U.S. entertainment company. As a result, all assets belonging to the identified individual and entity subject to U.S. jurisdiction are blocked and must be reported to OFAC, and U.S. persons are generally prohibited from engaging in transactions with them.

    See here for previous InfoBytes coverage on North Korean sanctions.

    Financial Crimes OFAC Department of Treasury International North Korea Sanctions Executive Order

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  • Trump issues Executive Order removing ALJs from competitive service

    Federal Issues

    On July 10, President Trump issued an Executive Order (EO) excepting Administrative Law Judges (ALJs) from the federal government’s competitive hiring service. The EO is in response to the recent Supreme Court decision in Lucia v. SEC, which held that ALJs are “inferior officers” subject to the Appointments Clause of the Constitution. (Previously covered by InfoBytes here.) The EO allows federal agencies to hire ALJs without going through the Office of Personnel Management (OPM) competitive selection process, which will give agencies the ability to select candidates who meet the agency’s specific needs— providing greater “flexibility and responsibility for ALJ appointments,” according to the White House announcement. The announcement emphasizes that the EO “reduces the legal uncertainty” over new ALJ appointments under the Appointments Clause in order to safeguard agencies’ enforcement of federal laws.

    Federal Issues ALJ U.S. Supreme Court SEC Trump Executive Order

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  • President Trump issues new Executive Order prohibiting the purchase of debt from the Venezuelan government

    Financial Crimes

    On May 21, President Trump issued an Executive Order (E.O.) prohibiting U.S. companies or individuals from buying debt or accounts receivable from the Venezuelan government “in light of the recent activities of the Maduro regime, including endemic economic mismanagement and public corruption at the expense of the Venezuelan people and their prosperity.” The sanctions specifically prohibit transactions related to the following: (i) “the purchase of debt owed to the Venezualan government, including accounts receivable;” (ii) debt pledged as collateral after May 21, including accounts receivable; and (iii) “the sale, transfer, assignment, or pledging as collateral by the Government of Venezuela of any equity interest in any entity in which the Government of Venezuela has a 50 percent or greater ownership interest.”

    The E.O., issued in conjunction with E.O. 13692, follows two prior E.O.s, which also targeted the Maduro regime—E.O. 13827, which prohibits U.S. persons from engaging in transactions that involve digital currency issued by, for, or on behalf of the Venezuelan government, and E.O. 13808, which prohibits transactions related to new debt, bonds, and dividend payments in conjunction with the Venezuelan government and the state-owned oil company. (See previous InfoBytes coverage here and here.). The E.O. took effect on May 21 at 12:30 p.m. EDT.

    See here for continuing InfoBytes coverage of actions related to Venezuela.

    Financial Crimes OFAC Department of Treasury Executive Order Trump Venezuela Sanctions International Cryptocurrency

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  • OFAC issues Belarus-related General License 2E

    Financial Crimes

    On April 27, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) issued General License No. 2E (GL 2E) to extend the authorization allowing nine Belarusian entities to enter into transactions otherwise prohibited by Executive Order 13405. GL 2E replaces and supersedes in its entirety General License No. 2D, and authorizes transactions with any entities that are owned 50 percent or more by the nine named entities. All property and interests in property of these entities, if blocked, remain blocked, and U.S. persons must report authorized transactions or any series of transactions exceeding $50,000 to the U.S. Department of State no later than 30 days after execution. The authorization expires on October 30, unless otherwise extended or revoked.

    Visit here for additional InfoBytes coverage on Belarus General Licenses.

    Financial Crimes OFAC Department of Treasury Department of State International Belarus Executive Order

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  • OFAC expands Venezuelan and Iranian sanctions

    Financial Crimes

    On January 5, the Treasury Department’s Office of Foreign Assets Control (OFAC) imposed additional sanctions against four current or former officials of the Venezuelan government. The designations, issued pursuant to Executive Order 13692, identify officials who are “associated with corruption and repression in Venezuela” and have “forsaken the professional republican mission of the military institution, which . . . is to be ‘with no political orientation … and in no case at the service of any person or political partisanship.’” All assets belonging to the identified individuals subject to U.S. jurisdiction are frozen, and U.S. persons are generally prohibited from dealing with them. See here for previous InfoBytes coverage of Venezuelan sanctions.

    Separately on January 4, OFAC designated five Iranian entities, pursuant to Executive Order 13382 (E.O. 13382), for their ties to Iran’s ballistic missile program. The five entities identified in the designation are either owned or controlled by an Iranian group that is “responsible for the development and production of Iran's solid-propellant ballistic missiles, is listed in the Annex to E.O. 13382 and is currently sanctioned by the U.S., UN, and EU.” In addition to freezing assets subject to U.S. jurisdiction and prohibiting U.S. persons from engaging in transactions with the entities, “foreign financial institutions that knowingly facilitate significant transactions for, or persons that provide material or certain other support to, the entities designated today risk exposure to sanctions that could sever their access to the U.S. financial system or block their property and interests in property under U.S. jurisdiction.” See here for previous InfoBytes coverage of Iranian sanctions.

    Financial Crimes Department of Treasury OFAC Sanctions International Executive Order Venezuela Iran

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  • U.S. Government Revokes Certain Sanctions on Sudan Following Review Period of Sudanese Policies and Actions

    Financial Crimes

    On October 6, the U.S. Government announced, effective October 12, the revocation of certain economic sanctions against Sudan and the Government of Sudan (GOS) as a recognition of sustained positive actions in connection with efforts to cease hostilities, improve humanitarian access, promote regional stability, and address the threat of terrorism. As previously covered in InfoBytes, the announcement follows a joint review conducted by the Secretary of State, the Secretary of the Treasury, the Director of National Intelligence, and the Administrator of the U.S. Agency for International Development that began in January 2017 as required by Executive Order 13761 and amended by Executive Order 13804. The Secretary of State issued a contemporaneous report concluding that, despite GOS’ demonstrated improvement in the areas that led to the issuance of Executive Order 13761, there remain a range of concerns. As such, while the comprehensive sanctions program has been lifted, certain sanctions and trade restrictions remain in place. Specifically:

    • the national emergency, established in Executive Order 13067 with respect to Sudan, remains in effect;
    • U.S. sanctions related to the conflict in Darfur, pursuant to Executive Order 13400, remain in place;
    • The U.S. Government maintains the authority to designate Sudanese persons according to other relevant sanctions authorities; and
    • Sudan remains on the list of state sponsors of terrorism, which will continue to impose restrictions on certain dealings involving Sudan, including U.S. foreign assistance and restrictions on defense exports and sales.

    Following revocation of the sanctions, U.S. persons will no longer be banned from engaging in most transactions previously prohibited by the Sudanese Sanctions Regulations (31 C.F.R. Part 538).

    The U.S. Treasury Department’s Office of Foreign Assets Control also released updated FAQs to answer questions related to the revocation, along with a new general license that authorizes certain transactions.

    Financial Crimes Sanctions OFAC Department of Treasury Department of State Executive Order

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  • White House Releases Proclamation Announcing National Cybersecurity Awareness Month

    Privacy, Cyber Risk & Data Security

    On September 30, President Trump issued a Proclamation announcing October 2017 as National Cybersecurity Awareness Month. As part of the initiative, the Department of Homeland Security (DHS) issued tools and resources for both consumers and organizations to manage cybersecurity risk. As previously covered in InfoBytes, the President issued an Executive Order earlier this year entitled “Strengthening the Cybersecurity of Federal Networks and Critical Infrastructure” that requires agencies to submit risk management reports to DHS and develop recommendations for cybersecurity improvements affecting all critical infrastructure, including the financial services industry.

    Privacy/Cyber Risk & Data Security Federal Issues Risk Management Trump Department of Homeland Security Executive Order

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