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  • OFAC sanctions Belarusian state-owned enterprises and government officials; amends Belarus Sanctions Regulations

    Financial Crimes

    On March 24, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions against Belarusian state-owned enterprises and government officials. In so doing, OFAC designated three entities and nine individuals, and identified one presidential aircraft as blocked property, pursuant to Executive Order 14038. The announcement noted that the designations build on previously issued sanctions taken against individuals and entities in Belarus in response to efforts by the Lukashenka regime to suppress democracy and support the Russian Federation’s war against Ukraine. “The authoritarian Lukashenka regime relies on state-owned enterprises and key officials to generate substantial revenue that enables oppressive acts against the Belarusian people,” Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian Nelson said in the announcement. Concurrently, the State Department imposed visa restrictions on 14 additional individuals, “including regime officials involved in policies to threaten and intimidate the Belarusian people, for their involvement in undermining democracy under Presidential Proclamation 8015.”

    As a result of the sanctions, all property and interests in property belonging to the sanctioned persons that are in the U.S. or in the possession or control of U.S. persons are blocked and must be reported to OFAC. Additionally, “any entities that are owned, directly or indirectly, individually or in the aggregate, 50 percent or more by one or more blocked persons are also blocked.” U.S. persons are generally prohibited from engaging in any dealings involving the property or interests in property of blocked or designated persons, unless authorized by a general or specific OFAC license, or if otherwise exempt.

    Additionally, OFAC published a final rule in the Federal Register amending and reissuing the Belarus Sanctions Regulations in their entirety in order to implement the August 2021 Belarus-related Executive Order 14038 (discussed above), “Blocking Property of Additional Persons Contributing to the Situation in Belarus,” and incorporate a directive regarding sovereign debt (covered by InfoBytes here and here). The final rule (effective March 27) also updates and adds new definitions, general licenses, and interpretive guidance, among other things.

    Financial Crimes Of Interest to Non-US Persons OFAC OFAC Sanctions OFAC Designations Belarus Russia Ukraine Ukraine Invasion

  • OFAC sanctions persons exploiting Guatemala mining sector

    Financial Crimes

    On November 18, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order 13818 against a Russian national and a Belarusian national, as well as three associated entities, “for their role in exploiting the Guatemalan mining sector.” OFAC noted that the designations demonstrate “the U.S. government’s ongoing commitment to impose tangible and significant consequences on corrupt actors in order to protect the U.S. financial system from abuse,” as well as its commitment “to identifying acts of corruption and promoting accountability for corrupt actors and disrupting their access to the U.S. and international financial system.” As a result of the sanctions, all property and interests in property belonging to the sanctioned persons that are in the U.S. or in the possession or control of U.S. persons are blocked and must be reported to OFAC. Further, “any entities that are owned, directly or indirectly, 50 percent or more by one or more blocked persons are also blocked.” U.S. persons are prohibited from engaging in any dealings involving the property or interests in property of blocked or designated persons, unless exempt or authorized by a general or specific OFAC license.

    Financial Crimes Of Interest to Non-US Persons OFAC Department of Treasury OFAC Sanctions OFAC Designations SDN List Guatemala Russia Belarus

  • OFAC sanctions Russians connected to human rights violations and Belarusian leader engaged in corruption

    Financial Crimes

    On March 15, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to the Russia Magnitsky Act against four individuals and one entity. According to OFAC, the sanctioned individuals and entity were involved in concealing events surrounding the death of renowned Russian whistleblower, Sergei Magnitsky, or were connected to gross violations of human rights against a Russian human rights defender. OFAC also re-designated, pursuant to Executive Order 13405, the head of a corrupt government in Belarus who used his authorities to benefit his inner circle and regime, and newly designated his wife for being a senior level official engaged in public corruption.

    As previously covered by InfoBytes, President Biden issued E.O 13405, “Blocking Property of Additional Persons Contributing to the Situation in Belarus,” which expanded the scope addressing the national emergency declared in E.O. 13405, “finding that the Belarusian regime’s harmful activities and long-standing abuses aimed at suppressing democracy and the exercise of human rights and fundamental freedoms in Belarus—including illicit and oppressive activities stemming from the August 9, 2020, fraudulent Belarusian presidential election and its aftermath, such as the elimination of political opposition and civil society organizations and the regime’s disruption and endangering of international civil air travel—constitute an unusual and extraordinary threat to the national security and foreign policy of the United States.” As a result of the sanctions, all property and interests in property belonging to the sanctioned entities subject to U.S. jurisdiction are blocked and must be reported to OFAC. Additionally, “any entities that are owned, directly or indirectly, 50 percent or more by one or more blocked persons are also blocked.” OFAC noted that U.S. persons are prohibited from participating in transactions with these persons, which includes “the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any blocked person or the receipt of any contribution or provision of funds, goods or services from any such person.”

    Financial Crimes Department of Treasury OFAC Biden SDN List Of Interest to Non-US Persons Russia Belarus

  • OFAC sanctions Belarusians for supporting Russian invasion of Ukraine

    Financial Crimes

    On February 24, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions against 24 Belarusian individuals and entities due to Belarus’s support for, and facilitation of, Russia’s invasion of Ukraine. The sanctions focus on Belarus’s defense sector and financial institutions, which have close ties to Russia. OFAC stressed that the “Belarusian economy is highly dependent on key Russian financial institutions and their subsidiaries” and that restrictions imposed against the Public Joint Stock Company Sberbank of Russia, VTB Bank Public Joint Stock Company, and State Corporation Bank for Development and Foreign Economic Affairs Vnesheconombank, combined with the new measures taken against Belarusian banks “target nearly one-fifth of the country’s entire financial sector.” Specifically, OFAC designated two significant state-owned banks that directly or indirectly finance or conduct activity on behalf of the Government of Belarus (GoB). “Sanctioning these two GoB-owned banks, in addition to Russia-related restrictions imposed on three other systemically important Belarusian financial institutions, means that a significant portion of the Belarusian financial sector is now subject to U.S. sanctions,” OFAC stated. As a result of the sanctions, all property and interests in property belonging to the sanctioned individuals and entities that are in the U.S. or in the possession or control of U.S. persons, and “any entities that are owned, directly or indirectly, 50 percent or more” by the blocked persons are blocked and must be reported to OFAC. U.S. persons are prohibited from engaging in any dealings involving the property or interests in property of blocked or designated persons, unless exempt or authorized by a general or specific OFAC license. 

    In conjunction with the sanctions, OFAC issued numerous related directives and general licenses that provide for multiple exceptions, along with several new and updated frequently asked questions. A Buckley Special Alert provides additional details related to the evolving nature of the U.S. sanctions response to Russia’s invasion of Ukraine.

    Financial Crimes Of Interest to Non-US Persons Department of Treasury OFAC OFAC Sanctions OFAC Designations Belarus Russia Ukraine Ukraine Invasion SDN List

  • OFAC published FAQs on Belarus, Ukraine-/Russia-related, and Venezuela-related sanctions programs

    Financial Crimes

    On January 7, the U.S. Treasury Department’s Office of Foreign Assets Control published a new FAQ 956 regarding Belarus, Ukraine-/Russia-related, and Venezuela-related sanctions programs, which prohibit U.S. persons from dealing in certain new debts (such as bonds, loans, drafts, loan guarantees, or letters of credit) of certain identified persons in these countries. The FAQ provides additional guidance on how OFAC views modifications to pre-existing loans, contracts, or other agreements to replace LIBOR as the reference rate. According to the FAQ, “[l]oans, contracts, or other agreements that use LIBOR as a reference rate that are modified to replace such benchmark reference rate will not be treated as new debt for OFAC sanctions purposes, so long as no other material terms of the loan, contract, or agreement are modified.”

    Financial Crimes OFAC LIBOR Department of Treasury OFAC Sanctions Belarus Ukraine Russia Of Interest to Non-US Persons

  • OFAC expands Belarusian human rights sanctions; restrict regime’s access to international capital markets

    Financial Crimes

    On December 2, OFAC impos[ed] restrictions on dealings in new issuances of Belarusian sovereign debt in the primary and secondary markets by issuing new Belarus-related Directive 1 under E.O. 14038, which “prohibits transactions in, provision of financing for, or other dealings by U.S. persons or within the United States in new debt with a maturity of greater than 90 days issued on or after December 2, 2021 by the Ministry of Finance of the Republic of Belarus or the Development Bank of the Republic of Belarus.” OFAC provided Guidance on Directive 1’s scope and implications through new Frequently Asked Questions 940941942943944945946947948 and updated FAQ 918. Additionally, OFAC issued Belarus General License 5, which authorizes limited transactions and activities necessary for the wind down of transactions involving certain identified entities. OFAC stated that these new restrictions reflect the close coordination between the U.S. and its partners and allies to restrict the Lukashenka regime’s access to international capital markets.

    The same day, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order (E.O.) 13405 against 20 individuals and 12 entities for allegedly enabling the “Lukashenka regime’s blatant disregard for international norms and the wellbeing of its own citizens.” Additionally, OFAC identified three aircraft as blocked property pursuant to E.O.s 14038 and 13405. The action was taken in coordination with the EU, the UK, and Canada.

    Financial Crimes Of Interest to Non-US Persons OFAC OFAC Sanctions OFAC Designations Department of Treasury Belarus

  • Biden’s executive order addresses Belarus

    Financial Crimes

    On August 9, President Biden issued an Executive Order (E.O.) on “Blocking Property of Additional Persons Contributing to the Situation in Belarus.” According to the E.O., expanding the scope will address the national emergency declared in E.O. 13405, “finding that the Belarusian regime’s harmful activities and long-standing abuses aimed at suppressing democracy and the exercise of human rights and fundamental freedoms in Belarus—including illicit and oppressive activities stemming from the August 9, 2020, fraudulent Belarusian presidential election and its aftermath, such as the elimination of political opposition and civil society organizations and the regime’s disruption and endangering of international civil air travel—constitute an unusual and extraordinary threat to the national security and foreign policy of the United States.” The E.O blocks property and interests in property that are in the U.S. or in the possession or control of certain persons who meet one or more of the criteria set forth in the order, including those who are determined, among other things: (i) “to be a political subdivision, agency, or instrumentality of the Government of Belarus”; (ii) “to be or have been a leader or official of the Government of Belarus”; and (iii) “to operate or have operated in the defense and related materiel sector, security sector, energy sector, potassium chloride (potash) sector, tobacco products sector, construction sector, or transportation sector of the economy of Belarus, or any other sector of the Belarus economy as may be determined by the Secretary of the Treasury, in consultation with the Secretary of State.” The Treasury Secretary, in consultation with the Secretary of State, is authorized to take actions, including promulgating rules and regulations, to carry out the purposes of the E.O.

    The same day, OFAC issued Belarus General License (GL) 4, related FAQs 916, 917 and 918, and added names to OFAC’s SDN list. Specifically, GL 4 authorizes the Wind Down of Transactions Involving Belaruskali OAO through December 8.

     

     

    Financial Crimes Belarus Of Interest to Non-US Persons Sanctions Department of Treasury OFAC Designations FAQs

  • OFAC sanctions persons connected to human rights abuses

    Financial Crimes

    On June 21, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order 13405 against 16 individuals and five entities for allegedly facilitating and perpetrating “the Lukashenka regime’s continued assault against peaceful protesters, journalists, members of the opposition, and civil society.” One of the individuals is also being sanctioned for “having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services in support of,” the designated Lukashenka regime. As a result of the sanctions, all property and interests in property belonging to the sanctioned persons, and “any entities that are owned, directly or indirectly, 50 percent or more” by the blocked persons that are subject to U.S. jurisdiction are blocked. OFAC notes that its regulations generally prohibit U.S. persons from participating in transactions with the designated persons, which include “the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any blocked person or the receipt of any contribution or provision of funds, goods or services from any such person.”

    The same day, OFAC also issued Belarus General License (GL) 3 and related FAQs 912 and 913. Specifically, GL 3 authorizes limited transactions and activities involving the State Security Committee of the Republic of Belarus that are necessary and ordinarily incident to “requesting, receiving, utilizing, paying for, or dealing in” certain licenses and authorizations for the importation, distribution, or use of certain information technology products in Belarus, and is intended to ensure that U.S. persons that engage in certain business activities that are not otherwise prohibited are not unduly impacted.

    Financial Crimes OFAC Department of Treasury Of Interest to Non-US Persons Belarus OFAC Sanctions

  • OFAC issues Belarus-related General License 2H

    Financial Crimes

    On April 19, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) issued General License No. 2H (GL 2H) to authorize a “45-day wind down period” for nine Belarusian entities to enter into certain transactions. GL 2H replaces and supersedes in its entirety General License No. 2G and authorizes all transactions with any entities that are owned by 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 June 3.

    Financial Crimes OFAC Department of Treasury Department of State Of Interest to Non-US Persons Belarus Sanctions OFAC Designations

  • 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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