OFAC FAQ (Current) # 48 - Blocking and Rejecting Transactions

Ed. Note: if you’re new to TURBOFAC, please take note that the text string filtration function generally shouldn’t be used for terms such as “ordinarily resident,” “causing” or “new debt”. For research on the meaning of words and phrases such as those, i.e. terms central to the key legal issues in sanctions law that appear on a cross-programmatic basis, you’re typically better off locating and checking the appropriate box in the “Key Legal Issues” search category, which will limit the results to those that have been manually assessed as being relevant for the interpretation of the terms at issue.

Try typing your search term (“ordinarily resident,” “new debt,” or something else) in the “Find a Search Filter” box at the top of the page, and the corresponding “Key Legal Issues” check box will pop up instantly, if one exists. Once you check the box (e.g. “new debt,” with ~55 results), you can always use the text string filtration function to further refine your search (e.g. by typing “invoice” and narrowing the ~55 results to ~10).

Note in addition that the same applies to text string searches such as “14071” (if you’re looking for items related to EO 14071). By typing “14071” in the “Find a Search Filter” field up top, you will be able to instantly narrow the results down to items manually assessed as relating to EO 14071. Ditto terms such as “515.204” or “Iran General License G” (try the “Discrete Legal Provision” search category). Please contact [email protected] or [email protected] with any questions on search results and efficiency.

Please click "Apply Text String Filters" again after clicking the "Close" button immediately below.

TURBOFAC Commentary (266 words)

Notes:

1) Consult the enforcement action module of the Research System to search for enforcement actions dealing specifically with diligence failures occurring subsequent to having initially received a "match," "hit" or other similar flag.

2) This FAQ is most notable for use of the term “reasonably close match,” in a context which appears to map onto OFAC’s standards for determining when one has a “reason to know” of facts giving rise to a potential violation. See generally General Note on the Terms "Knowingly," "Should Have Known" And "Reason to Know" In the Primary Sanctions, Secondary Sanctions and Derivative Designation Contexts (System Ed. Note). In other words, where one encounters a “reasonably close match.” There is an expectation to do further diligence. When the match is not “reasonably close,” there is no expectation to interdict and investigate (assuming no other sanctions-implicating facts other than the name).

3) The FAQ is also notable for the suggestion that that, unless a U.S. person holding property is sure that there is a blockable interest in property, the property should not actually be blocked until the factual question concerning the blockable interest has been resolved (in consultation with OFAC or otherwise). (“Unless you have an exact match or are otherwise privy to information indicating that the hit is a sanctions target, it is recommended that you do not actually block a transaction without discussing the matter with OFAC.”) This is further evidence that the blocked property reporting requirements operate such that the 10-day block begins once the determination has been made that there is a blockable interest in property.

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OFAC FAQ (Current) # 48 - Blocking and Rejecting Transactions

TURBOFAC Commentary (266 words)