Treasury Sanctions Syrian Regime Officials and Supporters
5/8/2014
Action Targets Senior Syrian Officials, a Russian Bank, its Chairman, and Oil Refineries Owned by the Government of Syria
WASHINGTON – The U.S. Department of the Treasury today took a number of actions to increase pressure on the Syrian regime and its supporters. The Treasury Department designated Moscow-based Tempbank and Mikhail Gagloev, a senior executive of the bank, pursuant to Executive Order (E.O.) 13582 for providing material support and services to the Government of Syria, including the Central Bank of Syria and SYTROL, Syria’s state oil marketing firm.
In addition, the Treasury Department designated six senior officials of the Syrian Government pursuant to E.O. 13573, including Brigadier General Bassam Al-Hassan, an advisor to President Bashar Al-Assad. Al-Hassan has a number of duties within the Syrian Government, including acting as the Syrian Presidential Representative to Syria’s Scientific Studies and Research Center (SSRC), which is the government agency responsible for developing and producing non-conventional weapons and missiles.
Finally, the Treasury Department has identified the Banias Refinery Company and the Homs Refinery Company as part of the Government of Syria pursuant to E.O. 13582.
“Today’s designation builds on Treasury’s ongoing efforts to apply economic pressure on the Syrian Government by choking off access to the international financial system,” said Under Secretary for Terrorism and Financial Intelligence David S. Cohen. “We are committed to deterring those who contribute to violence and instability in Syria, and will continue to aggressively target individuals and entities supporting the Assad regime.”
Temp
bank has provided millions of dollars in cash and facilitated financial services to the Syrian regime. In one instance, Tempbank arranged to deliver millions of dollars in cash to Vnukovo Airport in Moscow for pick-up by cash couriers working for the Central Bank of Syria. In addition to its close cooperation with the Central Bank of Syria, Tempbank has facilitated deals and provided financial services to SYTROL, a Syrian state oil company sanctioned by the United States and the European Union. Mikhail Gagloev, Chairman of Tempbank’s Management Committee, was also designated today for acting for or on behalf of Tempbank. Gagloev has personally travelled to Damascus to make deals with the Syrian regime on behalf of Tempbank.
U.S. persons are generally prohibited from engaging in any transactions with the individuals and entities identified today, and any assets of those persons subject to U.S. jurisdiction are frozen. To date, the United States has imposed sanctions on nearly 200 individuals and entities since the onset of unrest in Syria, including the Government of Syria, its Central Bank, and affiliated oil companies.
1) Refer to Introductory Note Common to all Derivative Designation Notices Included in the Research System (System Ed. Note). That note explains the specific criteria used for determining which designation notices are included.
2) NOTE SPECIFIC TO THIS DESIGNATION NOTICE
This designation appears to satisfy the criteria described in the "Introductory Note." In this case, the scale of the conduct at issue appears to explain the designation of the bank, as distinguishable from other cases of financial services being provided to the Government of Syria. The designation is also notable for the fact that a non-Syrian bank official was designated along with the bank. Two years subsequent to this, OFAC designated nine other executive and supervisory board members connected to the bank.
Note that OFAC has, subsequent to this designation, made relatively clear that it will "aggressively target for designation any person who provides support to the [Assad] regime, for example by facilitating exports to or imports from the Government of Syria, including government-owned entities, unless such exportation or importation is otherwise exempt or authorized." See OFAC Advisory to the Maritime Petroleum Shipping Community: Sanctions Risks Related to Petroleum Shipments involving Iran and Syria (March, 2019). In practice, oil, arms and major financial services have been the only type of international trade transactions resulting in derivative designations pursuant to EO 13582, but EO 13582 is used a quasi-secondary sanctions authority, at least to cover particularly sensitive transactions.