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CASE No. SDGT-1051
Martin F. McMahon, Esq.
Martin F. McMahon & Associates
1150 Connecticut Avenue, NW, Suite 900
Washington, DC 20036
Dear Mr. McMahon:
This responds to your August 22, 2008 letter to the Office of Foreign Assets Control ("OFAC"), on behalf of the International Islamic Relief Organization of Saudi Arabia ("IIRO-SA"), requesting OFAC's assistance in avoiding the blocking of a $785,000 wire funds transfer related to the February 21, 2008 sale of Virginia property to be sent by your client, Sanabel Al Kheer ("Sanabel"), to IIRO SA.
As you know, on August 3, 2006, both the Indonesia and Philippines branches of the International Islamic Relief Organization were designated as Specially Designated Global Terrorists pursuant to section 594.201 of the Global Terrorism Sanctions Regulations, 31 C.F.R. Part 594, for facilitating fundraising for al Qaida and...
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1) See application in native PDF file. This guidance illustrates how the rigid 50% rule only operates downstream, rather than upstream, where in the latter case the concept of "indirect dealings" is applied.
OFAC deems the transaction acceptable provided that no payments are made "indirectly" to the designated entities. Note that the regulations to not explicitly state that one cannot "indirectly" deal with a blocked entity by dealing with an entity that controls an SDN, but OFAC takes the position that the concept is implicit in all sanctions regulations. (See Revised Guidance on Entities Owned by Persons Whose Property and Interests in Property are Blocked).
Here, the applicant offered to provide a written attestation that none of the funds actually sent to the entity that controlled the SDNs would be apportioned to the SDNs....