Enforcement Release: EFG International AG

Date issued: Mar. 14 2024

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TURBOFAC Commentary (1543 words)

Notes:

1) The EFG International AG (“EFG”) case belongs to a line of cases starting with Clearstream Banking, S.A. (2014) and continuing with UBS AG (2015). In both cases, the fundamental basis for liability was the same, i.e. that a non-U.S. person financial institution holding securities in the U.S. “caused” U.S. custodians and others to deal in blocked property and export financial services to the sanctioned beneficial owners of the securities. The Clearstream case is particularly similar to this one insofar as Clearstream held securities on behalf of a sanctioned person through an “omnibus” account that (by its nature) obscured the sanctioned person’s interest in the securities custodied in the U.S. In the UBS case, securities custodied in the U.S. were held on behalf of a non-designated entity associated with a blocked person. In the UBS case, OFAC charged violations in connection with...