United States Department of the Treasury
The Office of Foreign Assets Control (OFAC) is an agency of the United States Department of the Treasury under the auspices of the Under Secretary of the Treasury for Terrorism and Financial Intelligence. OFAC administers and enforces economic and trade sanctions based on U.S. foreign policy and national security goals against targeted foreign states, organizations, and individuals.
The current director of OFAC is Adam J. Szubin.
History
Involvement of the U.S. Department of the Treasury in economic sanctions against foreign states dates to the War of 1812, when Secretary Albert Gallatin administered sanctions against Great Britain in retaliation for the harassment of American sailors.[1]
The Division of Foreign Assets Control, the immediate predecessor to OFAC, was established in December 1950. Predecessor agencies of the Division of Foreign Assets Control include Foreign Funds Control, which existed from 1940 to 1947, and the Office of International Finance (1947 to 1950). OFAC's earliest predecessor, Foreign Funds Control, was established by Executive Order 8389 as a unit of the Office of the Secretary of the Treasury on April 10, 1940. The authority to establish Foreign Funds Control was derived from the Trading with the Enemy Act of 1917. Among other operations, Foreign Funds Control administered wartime import controls over enemy assets and restrictions on trade with enemy states. It also participated in administering the Proclaimed List of Certain Blocked Nationals, or the "Black List", and took censuses of foreign-owned assets in the United States and American-owned assets abroad. Foreign Funds Control was abolished in 1947, with its functions transferred to the newly established Office of International Finance (OIF). In 1948, OIF activities relating to blocked foreign funds were transferred to the Office of Alien Property, an agency within the Department of Justice.[2]
The Division of Foreign Assets Control was established in the Office of International Finance by a Treasury Department order in 1950, following the entry of the People's Republic of China into the Korean War; President Harry S Truman declared a national emergency and blocked all Chinese and North Korean assets subject to U.S. jurisdiction. In addition to blocking Chinese and North Korean assets, the Division administered and certain regulations and orders issued under the amended Trading with the Enemy Act.[1]
On October 15, 1962, by a Treasury Department order, the Division of Foreign Assets Control became the Office of Foreign Assets Control.[2]
Authority and activities
In addition to the Trading with the Enemy Act, OFAC derives its authority from a variety of U.S. federal laws regarding embargoes and economic sanctions. See United States embargoes for a list of affected countries.
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.[1]
Under the International Emergency Economic Powers Act, the President of the United States is empowered during emergency situations 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.
Specially Designated Nationals List
The Specially Designated Nationals (SDN) List is a publication of OFAC which lists individuals and organizations with whom United States citizens and permanent residents are prohibited from doing business.[1]
Lists similar to the Specially Designated Nationals List are maintained by the Bureau of Industry and Security of the U.S. Department of Commerce. These include the Denied Persons List and the Entity List, which are concerned with issues of exporting goods that could pose a danger to U.S. interests if diverted or misused. While the two lists are similar in some respects, the differing goals of the OFAC and BIS lists preclude their being combined into a "master" list.[1] However, the SDN List is part of the Excluded Parties List System,[3] a federal initiative which also includes the BIS lists. Many companies use third-party service providers to ensure compliance and keep abreast of new entries to the sanction lists.
References
- ^ a b c d e "Frequently Asked Questions". Office of Foreign Assets Control. http://www.treasury.gov/offices/enforcement/ofac/faq/answer.shtml#2. Retrieved 2007-09-17.
- ^ a b "Records of the Office of Foreign Assets Control". The National Archives. http://www.archives.gov/research/guide-fed-records/groups/265.html#265.1. Retrieved 2007-09-17.
- ^ Excluded Parties List System
External links
