Letter From T. Maloney (Treasury) to Sen. M. Kirk re: Post-JCPOA Dollar Transactions (2016)

Date issued: Jul. 07 2016

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TURBOFAC Commentary (355 words)

Notes:

1) Correspondence clarifies the commonly-misunderstood [1] fact that the jurisdictional basis for control over Iran's access to the U.S. financial system is not that banking transactions involve dollars per se, but that they typically require U.S. persons to, e.g., export financial services to Iran (560.204) or otherwise "deal in" property in which blocked persons have an interest (560.211, in the case of Iran).

The statement that OFAC does "not exercise sanctions jurisdiction over transactions denominated in U.S. dollars" is true of physical dollars as well as offshore electronic dollar clearing and other types of book transfers that do not involve the U.S. financial system, but note that since the drafting of this letter OFAC appears to take a more aggressive stance on what constitutes involvement of the U.S. financial system when it comes to offshore book transfers. See comments to...