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Enforcement Release - Union de Banques Arabes et Françaises

Date issued: Jan. 04 2021

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Enforcement Release: January 4, 2021

OFAC Enters Into $8,572,500 Settlement with Union de Banques Arabes et Françaises for Apparent Violations of Syria-Related Sanctions Program

Union de Banques Arabes et Françaises (“UBAF”), a bank based in France that facilitates trade finance between Europe and the Middle East, North Africa, sub-Saharan Africa, and Asia, has agreed to remit $8,572,500 to settle its potential civil liability for 127 apparent violations of Syria-related sanctions (the “Apparent Violations”). Between August 2011 and April 2013, UBAF operated U.S. dollar (USD) accounts on behalf of sanctioned Syrian financial institutions and indirectly conducted USD business on behalf of these institutions through the U.S. financial system. In particular, the majority of the Apparent Violations involved UBAF’s processing of internal transfers on behalf of Syrian entities that were followed by corresponding funds transfers through a U.S. bank. The remaining Apparent Violations were either “back-to-back” letter of...

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TURBOFAC Commentary (951 words)

Notes:

1) THE OFFSHORE BOOK TRANSFERS AND FX TRANSACTIONS

The first 127 violations cited in the “Union de Banques Arabes et Françaises” case are similar in kind to those discussed in the General Note on Enforcement Actions Resulting From “Bank-to-Bank” Transactions that Only Indirectly Involve Sanctions Targets (“Complex Payment Structures,” Structured Transactions, etc.)

In that note, we discuss various violations that OFAC has found where a bank processes transactions through the U.S. financial system that do not relate directly to any sanctioned person, but are related to other transactions that do directly relate to a sanctioned person. In general, the transaction that is processed through the U.S. financial system (Transaction A) is one that would not constitute a sanctions violation if not for its relationship to the second transaction (Transaction B), and Transaction B is one that would, but for its relationship to...