OFAC Designates North Koreans Allegedly Linked to WMD Proliferation

June 27, 2013 Leave a comment

Today the United States Department of the Treasury Office of Foreign Assets Control (“OFAC”) announced the designation of two private North Korean individuals and two North Korean linked entities pursuant to Executive Order 13382. These parties’ names now appear on the List of Specially Designated Nationals and Blocked Persons (SDN List) The move was cited as part of an ongoing effort to disrupt North Korean efforts at procuring ballistic missile and weapons of mass destruction (WMD). Daedong Credit Bank (DCB), together with DCB Finance Limited—a DCB front company—and DCB’s representative Kim Chol Sam were designated pursuant to Executive Order (E.O.) 13382. In addition, the other individual designated, Son Mun San, is the External Affairs Bureau Chief of North Korea’s General Bureau of Atomic Energy (GBAE). The financial operations carried out by DCB, DCB Finance Limited, and Kim Chol Sam are responsible for managing millions of dollars of transactions in support of the North Korean regime’s destabilizing activities.

Those seeking to contest their designations can pursue such reconsideration through the administrative process. Please click here for more information on contesting an OFAC designation. The identifying information on these designations is contained below:

KIM, Chol Sam; DOB 11 Mar 1971; nationality Korea, North; Treasurer, Daedong Credit Bank (individual) [NPWMD];

SON, Mun San; DOB 23 Jan 1951; External Affairs Bureau Chief, General Bureau of Atomic Energy (individual) [NPWMD];

DAEDONG CREDIT BANK (a.k.a. DAE-DONG CREDIT BANK; a.k.a. DCB; a.k.a. TAEDONG CREDIT BANK), Suite 401, Potonggang Hotel, Ansan-Dong, Pyongchon District, Pyongyang, Korea, North; Ansan-dong, Botongang Hotel, Pongchon, Pyongyang, Korea, North; SWIFT/BIC DCBK KPPY [NPWMD];

DCB FINANCE LIMITED, Akara Building, 24 de Castro Street, Wickhams Cay I, Road Town, Tortola, Virgin Islands, British; Dalian, China [NPWMD].

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrariassociatespc.com.

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OFAC Designates a Number of New Kingpins

June 12, 2013 Leave a comment

Today the United States Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) designated eighteen (18) individuals and fifteen (15) entities linked to Rafael Caro Quintero, an alleged Mexican drug trafficker. According to the Treasury Press Release, Rafael Caro Quintero is believed to have been involved in criminal activity since the late 1970s when he and others, including Juan Jose Esparragoza Moreno (a.k.a. “El Azul”), are believed to have formed the Guadalajara drug cartel and amassed an illicit fortune. According to OFAC, Caro Quintero was behind the kidnapping and murder of Drug Enforcement Administration (DEA) Special Agent (SA) Enrique Camarena in 1985. Caro Quintero was convicted in Mexico for his involvement in SA Camarena’s murder and drug trafficking and is currently serving a 40 year prison sentence there.

OFAC designations can be damaging, but there is recourse. For more information on how to contest an OFAC SDN designation as a Foreign Narcotics Trafficking Kingpin (SDNTK), or any other type of designation, please read our page on OFAC SDN Removal.

Here is the listings that were made by OFAC:

ADIB MADERO, Michel; DOB 21 Feb 1977; POB Jalisco, Mexico; Cedula No. 3348806 (Mexico); R.F.C. AIMM770221CJ7 (Mexico); C.U.R.P. AIMM770221HJCDDC08 (Mexico) (individual) [SDNTK] (Linked To: RESTAURANT BAR LOS ANDARIEGOS, S.A. DE C.V.).

BUENROSTRO VILLA, Denisse, Circuito Madrigal 4236-05, Zapopan 45510, Mexico; DOB 22 Mar 1980; POB Guadalajara, Jalisco, Mexico; C.U.R.P. BUVD800322MJCNLN06 (Mexico) (individual) [SDNTK] (Linked To: EL BANO DE MARIA, S. DE R.L. DE C.V.).

CARO ELENES, Hector Rafael (a.k.a. CARO HELENES, Hector Rafael), Callejon del Serrano 4361, Guadalajara, Jalisco, Mexico; Loreto Mendez #4432, Guadalajara, Jalisco, Mexico; San Gonzalo No. 1715, Colonia Santa Isabel, Zapopan, Jalisco C.P. 45110, Mexico; Calle Circuito Madrigal No. 4236 Interior 5, Colonia Santa Isabel, Zapopan, Jalisco C.P. 45110, Mexico; Avenida Acueducto No. 5056, Colonia Jardines de la Patria, Zapopan, Jalisco, Mexico; DOB 18 Dec 1975; POB Culiacan, Sinaloa, Mexico; R.F.C. CAEH751218JT4 (Mexico); C.U.R.P. CAEH751218HSLRLC01 (Mexico) (individual) [SDNTK] (Linked To: BLUE POINT SALT, S.A. DE C.V.; Linked To: DESARROLLOS BIO GAS, S.A. DE C.V.; Linked To: ECA ENERGETICOS, S.A. DE C.V.; Linked To: ORGANIC SALT, S.A. DE C.V.; Linked To: PETRO BIO, S. DE R.L. DE C.V.; Linked To: PRONTO SHOES, S.A. DE C.V.).

CARO ELENES, Henoch Emilio, Callejon del Sereno No. 4361, Col. Fracc. Jardines Universidad, Zapopan, Jalisco C.P. 45110, Mexico; Paseo del Bosque No. 2428, Colonia Lomas Altas, Zapopan, Jalisco, Mexico; Av. Pablo Neruda No. 4111, Casa 1, Colonia Lomas del Valle, Zapopan, Jalisco C.P. 45129, Mexico; Paseo de los Parques No. 3995, Interior 7, Zapopan, Jalisco C.P. 45110, Mexico; Loreto Mendez #4432, Guadalajara, Jalisco, Mexico; DOB 15 Mar 1980; POB Culiacan, Sinaloa, Mexico; alt. POB Guadalajara, Jalisco, Mexico; R.F.C. CAEH800315V38 (Mexico); C.U.R.P. CAEH800315HSLRLN07 (Mexico) (individual) [SDNTK] (Linked To: BLUE POINT SALT, S.A. DE C.V.; Linked To: DESARROLLOS BIO GAS, S.A. DE C.V.; Linked To: ECA ENERGETICOS, S.A. DE C.V.; Linked To: EVCOMER, S.A. DE C.V.; Linked To: PETRO BIO, S. DE R.L. DE C.V.; Linked To: PRONTO SHOES, S.A. DE C.V.; Linked To: REFORESTACIONES CARELES, S. DE P.R. DE R.L.).

CARO ELENES, Mario Yibran (a.k.a. CARO, Gibran), Callejon del Sereno No. 4361, Col. Fracc. Jardines Universidad, Zapopan, Jalisco C.P. 45110, Mexico; Calle Loreto Mendez 4432, Sector Hidalgo, Guadalajara, Jalisco, Mexico; DOB 11 Jun 1983; POB Guadalajara, Jalisco, Mexico; R.F.C. CAEM830611SXD (Mexico); C.U.R.P. CAEM830611HJCRLR05 (Mexico) (individual) [SDNTK] (Linked To: PETRO BIO, S. DE R.L. DE C.V.; Linked To: PRONTO SHOES, S.A. DE C.V.; Linked To: REFORESTACIONES CARELES, S. DE P.R. DE R.L.).

CARO ELENES, Roxana Elizabeth, Callejon del Sereno No. 4361, Col. Fracc. Jardines Universidad, Zapopan, Jalisco C.P. 45110, Mexico; San Gonzalo No. 1715, Colonia Santa Isabel, Zapopan, Jalisco C.P. 45110, Mexico; DOB 17 Jan 1978; POB Culiacan, Sinaloa, Mexico; R.F.C. CAER780117MK8 (Mexico); C.U.R.P. CAER780117MSLRLX03 (Mexico) (individual) [SDNTK] (Linked To: HACIENDA LAS LIMAS, S.A. DE C.V.; Linked To: PETRO BIO, S. DE R.L. DE C.V.; Linked To: REFORESTACIONES CARELES, S. DE P.R. DE R.L.).

CONTRERAS SANCHEZ, Diego; DOB 19 Apr 1985; POB Jalisco, Mexico; R.F.C. COSD850419T13 (Mexico); C.U.R.P. COSD850419HJCNNG02 (Mexico) (individual) [SDNTK] (Linked To: RESTAURANT BAR LOS ANDARIEGOS, S.A. DE C.V.).

CORTES VILLASENOR, Luis, Av. Vallarta No. 3060, Colonia Vallarta San Jorge, Guadalajara, Jalisco, Mexico; DOB 03 Mar 1971; POB Mexico City, Mexico; R.F.C. COVL7103034L4 (Mexico) (individual) [SDNTK] (Linked To: GRUPO FRACSA, S.A. DE C.V.; Linked To: GRUPO CONSTRUCTOR SEGUNDO MILENIO, S.A. DE C.V.).

ELENES LERMA, Maria Elizabeth (a.k.a. ELENES DE CARO, Elizabeth), San Gonzalo No. 1715, Colonia Santa Isabel, Zapopan, Jalisco C.P. 45110, Mexico; Carretera Isidro Mazatepec No. 500, Colonia San Agustin, Tlajomulco de Zuniga, Jalisco C.P. 45645, Mexico; DOB 12 Dec 1952; POB Badiraguato, Sinaloa, Mexico; alt. POB Culiacan, Sinaloa, Mexico; R.F.C. EELE521212B18 (Mexico); C.U.R.P. EELE521212MSLLRL01 (Mexico) (individual) [SDNTK] (Linked To: HACIENDA LAS LIMAS, S.A. DE C.V.).

GARZA RODRIGUEZ, Beatriz (a.k.a. GARZA RODRIGUEZ DE SANCHEZ, Beatriz), Av. Vallarta No. 3060, Colonia Vallarta San Jorge, Guadalajara, Jalisco, Mexico; 5151-37 A Av. Acueducto, La Colonia Residencial Pontevedra, Zapopan, Jalisco, Mexico; DOB 14 Nov 1948; POB Los Mochis, Sinaloa, Mexico; R.F.C. GARB481114965 (Mexico); C.U.R.P. GARB481114MSLRDT03 (Mexico) (individual) [SDNTK].

RIEBELING CORDERO, Hilda, 3888 Calle Paseo de los Parques, Colonia Colinas de San Javier, Zapopan, Jalisco, Mexico; DOB 21 Jan 1972; POB Guadalajara, Jalisco, Mexico; Passport 99140083768 (Mexico); R.F.C. RICH7201214J3 (Mexico); C.U.R.P. RICH720121MJCBRL08 (Mexico) (individual) [SDNTK].

SANCHEZ BARBA, Jose de Jesus, Av. Vallarta No. 3060, Col. Vallarta San Jorge, Guadalajara, Jalisco, Mexico; 5151-37 A Avenida Acueducto, La Colonia Residencial Pontevedra, Zapopan, Jalisco, Mexico; DOB 02 Jul 1937; POB Tepatitlan de Morelos, Jalisco, Mexico; C.U.R.P. SABJ370702HJCNRS04 (Mexico) (individual) [SDNTK].

SANCHEZ GARZA, Diego, Av. Vallarta No. 3060, Colonia Vallarta San Jorge, Guadalajara, Jalisco, Mexico; DOB 05 Apr 1976; POB Guadalajara, Jalisco, Mexico; R.F.C. SAGD760405A45 (Mexico); C.U.R.P. SAGD760405HJCNRG06 (Mexico) (individual) [SDNTK] (Linked To: GRUPO FRACSA, S.A. DE C.V.; Linked To: DBARDI, S.A. DE C.V.; Linked To: GRUPO CONSTRUCTOR SEGUNDO MILENIO, S.A. DE C.V.).

SANCHEZ GARZA, Jose de Jesus, Av. Vallarta No. 3060, Colonia Vallarta San Jorge, Guadalajara, Jalisco, Mexico; DOB 12 Aug 1968; POB Guadalajara, Jalisco, Mexico; Passport 98140159994 (Mexico); R.F.C. SAGJ680812RE1 (Mexico); C.U.R.P. SAGJ680812HJCNRS08 (Mexico) (individual) [SDNTK] (Linked To: GRUPO FRACSA, S.A. DE C.V.; Linked To: DBARDI, S.A. DE C.V.).

SANCHEZ GARZA, Mauricio, Av. Vallarta No. 3060, Colonia Vallarta San Jorge, Guadalajara, Jalisco, Mexico; DOB 07 Dec 1970; POB Guadalajara, Jalisco, Mexico; Passport 99140083769 (Mexico); R.F.C. SAGM7012071B6 (Mexico); C.U.R.P. SAGM701207HJCNRR05 (Mexico) (individual) [SDNTK] (Linked To: DBARDI, S.A. DE C.V.; Linked To: GRUPO FRACSA, S.A. DE C.V.).

SANCHEZ GONZALEZ, Ernesto, Av. Vallarta 3216, Colonia Vallarta San Jorge, Guadalajara, Jalisco, Mexico; DOB 03 Feb 1967; POB Tepatitlan de Morelos, Jalisco, Mexico; R.F.C. SAGE670203KH4 (Mexico); C.U.R.P. SAGE670203HJCNNR06 (Mexico) (individual) [SDNTK] (Linked To: GRUPO FRACSA, S.A. DE C.V.; Linked To: DBARDI, S.A. DE C.V.).

SANCHEZ GONZALEZ, Ruben, Av. Arcos 960, Colonia Jardines del Bosque, Guadalajara, Jalisco, Mexico; DOB 14 Jul 1964; POB Tepatitlan de Morelos, Jalisco, Mexico; R.F.C. SAGR640714-882 (Mexico); C.U.R.P. SAGR640714HJCNNB02 (Mexico) (individual) [SDNTK] (Linked To: GRUPO FRACSA, S.A. DE C.V.; Linked To: DBARDI, S.A. DE C.V.; Linked To: PISCILANEA, S.A. DE C.V.).

VARGAS CORREA, Humberto; DOB 25 Mar 1959; POB Iztacalco, Distrito Federal, Mexico; R.F.C. VACH5903253B0 (Mexico); C.U.R.P. VACH590325HDFRRM07 (Mexico) (individual) [SDNTK].

The following entities have been added to OFAC’s SDN List:

BLUE POINT SALT, S.A. DE C.V., A Las Rocas No. 244, Col. Prados Vallarta, Zapopan, Jalisco C.P. 45020, Mexico; Callejon del Sereno 4361, Zapopan, Jalisco C.P. 45110, Mexico; R.F.C. BPS050519NM6 (Mexico) [SDNTK].

DBARDI, S.A. DE C.V., Guadalajara, Jalisco C.P. 44540, Mexico; Folio Mercantil No. 4867-1 (Mexico) [SDNTK].

DESARROLLOS BIO GAS, S.A. DE C.V., Independencia Sur No. 185, Col. Analco, Guadalajara, Jalisco C.P. 44450, Mexico; R.F.C. DBG0805095P7 (Mexico) [SDNTK].

ECA ENERGETICOS, S.A. DE C.V., Calle Adolfo B. Horn No. 1437, Col. Pueblo Toluquilla, Tlaquepaque, Jalisco C.P. 45610, Mexico; R.F.C. EEN0310271G7 (Mexico) [SDNTK].

EL BANO DE MARIA, S. DE R.L. DE C.V., Periferico Poniente No. 2100, Col. Ciudad Granja, Guadalajara, Jalisco C.P. 45010, Mexico; Santa Clara No. 88, Col. El Briseno, Zapopan, Jalisco C.P. 45236, Mexico; Av. Pablo Neruda casi esq. con Ruben Dario, Guadalajara, Jalisco, Mexico; Gran Plaza, Guadalajara, Jalisco, Mexico; Plaza del Sol, Guadalajara, Jalisco, Mexico; Plaza Patria, Guadalajara, Jalisco, Mexico; Plaza Mexico, Guadalajara, Jalisco, Mexico; Aeropuerto de Guadalajara, Jalisco, Mexico; Puerto Vallarta, Jalisco, Mexico; Mazatlan, Sinaloa, Mexico; Monterrey, Nuevo Leon, Mexico; Celaya, Guanajuato, Mexico; Tijuana, Baja California, Mexico; Los Cabos, Baja California Sur, Mexico; R.F.C. BMA040923MZ9 (Mexico) [SDNTK].

EVCOMER, S.A. DE C.V., Independencia Sur No. 185, Col. Analco, Guadalajara, Jalisco C.P. 44450, Mexico; R.F.C. EVC080410DE6 (Mexico) [SDNTK].

GRUPO CONSTRUCTOR SEGUNDO MILENIO, S.A. DE C.V., Av. Acueducto, s/n Col. Fraccionamiento Jardines del Country, Guadalajara, Jalisco C.P. 44210, Mexico; Folio Mercantil No. 5269-1 (Mexico) [SDNTK].

GRUPO FRACSA, S.A. DE C.V. (a.k.a. PONTEVEDRA; a.k.a. ZOTOGRANDE), Av. Vallarta No. 3060, Col. Vallarta Norte, Guadalajara, Jalisco, Mexico; Acueducto 5300, Zapopan, Jalisco, Mexico; Acueducto 5151, Zapopan, Jalisco, Mexico; Folio Mercantil No. 19730-1 (Mexico) [SDNTK].

HACIENDA LAS LIMAS, S.A. DE C.V., Carretera a Ciudad Guzman Km. 49, entre de crucero de Atoyac y crucero de Amacueca, Acatlan, Jalisco, Mexico; Callejon del Sereno #4361, Colonia Villa Universitaria, Zapopan, Jalisco, Mexico; R.F.C. HLI040211HK3 (Mexico) [SDNTK].

ORGANIC SALT, S.A. DE C.V., Callejon del Sereno No. 4361, Col. Jacarandas Zapopan 4, Zapopan, Jalisco C.P. 45110, Mexico; R.F.C. OSA030512AL3 (Mexico) [SDNTK].

PETRO BIO, S. DE R.L. DE C.V., Independencia Sur No. 185, Col. Analco, Guadalajara, Jalisco C.P. 44450, Mexico; R.F.C. PBI080509Q47 (Mexico) [SDNTK].

PISCILANEA, S.A. DE C.V. (a.k.a. ALBERCAS E HIDROMASAJE PISCILANEA; a.k.a. ALBERCAS Y TINAS BARCELONA), Provenza Center, Av. Lopez Mateos No. 5565, Loc 23, Col. Santa Anita, Tlajomulco de Zuniga, Jalisco 45645, Mexico; R.F.C. PIS090915KS1 (Mexico) [SDNTK].

PRONTO SHOES, S.A. DE C.V. (a.k.a. CX INSPIRA; a.k.a. CX MILAN GUADALAJARA; a.k.a. CX MODA; a.k.a. CX-SHOES), 16 de Septiembre 635, Casi Esq. la Paz, Guadalajara, Jalisco, Mexico; Av. Lafragua 2729, Esq. Paseo Jardin, Fracc. Moderno, Veracruz, Veracruz, Mexico; Comercio No. 172, Col. Mexicaltzingo, Guadalajara, Jalisco C.P. 44180, Mexico; Padre Mier 185, Col. Centro, Monterrey, Nuevo Leon C.P. 64000, Mexico; San Lorenzo 31 Entre Calzada la Ermita y Rueda Pastor, Col. 8va. Amplicacion Iztapalapa, Mexico, Distrito Federal, Mexico; Tecnologico 210, Esq. Cortador, Fracc. Industrial Julian de Obregon, Leon, Guanajuato C.P. 37290, Mexico; R.F.C. PSH081211I53 (Mexico) [SDNTK].

REFORESTACIONES CARELES, S. DE P.R. DE R.L., Callejon del Sereno No. 4361, Col. Fracc. Jardines Universidad, Zapopan, Jalisco C.P. 45110, Mexico; R.F.C. RCA050316ET5 (Mexico) [SDNTK].

RESTAURANT BAR LOS ANDARIEGOS, S.A. DE C.V. (a.k.a. BARBARESCO RESTAURANT), Buenos Aires No. 3090, esq. Montevideo, Col. Providencia, Guadalajara, Jalisco 44630, Mexico; R.F.C. RBA0504194T6 (Mexico) [SDNTK].

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrariassociatespc.com.

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OFAC Hits Alleged Al Qaeda Bomb Maker with SDGT Designation

June 6, 2013 Leave a comment

Today, the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated Abd al-Hamid Al-Masli pursuant to Executive Order 13224. Treasury cites Al-Masli as being a bomb maker for Al-Qaeda and acting as the leader of an Al Qaeda electronics and explosives workshop in Pakistan, which is responsible for producing IED components for Al Qaeda senior leadership. As a result of today’s action, any property in the United States or in the possession or control of U.S. persons in which ‘Abd-al-Hamid al-Masli has an interest is blocked, and U.S. persons are generally prohibited from engaging in transactions with him. Al-Masli has a right to request a reconsideration of his designation through OFAC’s administrative reconsideration process outlined at 31 CFR 501.807.

The identifying information for Al-Masli can be found below:

AL-MASLI, ‘Abd-al-Hamid (a.k.a. AL-DARNAVI, Hamza; a.k.a. AL-DARNAWI, Abu-Hamzah; a.k.a. AL-DARNAWI, Hamza; a.k.a. AL-DARNAWI, Hamzah; a.k.a. AL-MASLI, ‘Abd al-Hamid Muhammad ‘Abd al-Hamid; a.k.a. DARNAVI, Hamza; a.k.a. DARNAWI, Abdullah; a.k.a. DARNAWI, Hamza; a.k.a. DARNAWI, Hamzah; a.k.a. DIRNAWI, Hamzah; a.k.a. MASLI, Hamid; a.k.a. MUSALLI, ‘Abd-al-Hamid), Waziristan, Federally Administered Tribal Areas, Pakistan; DOB 1976; POB Darnah, Libya; alt. POB Danar, Libya; nationality Libya (individual) [SDGT].

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrariassociatespc.com.

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Then There Was One: OFAC Removes Iraqi Bank from the Part 561 List

May 22, 2013 Leave a comment

Last week, the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced that it was releasing Elaf Islamic Bank (Elaf) from the Part 561 List. The Part 561 List targets those foreign financial institutions facilitating certain significant financial institutions on behalf of certain Iranian financial institutions by barring their ability to establish and maintain correspondent banking relationships with the U.S. The name comes from Part 561 of Title 31 of the Code of Federal Regulations which contains the Iranian Financial Sanctions Regulations (IFSR), a set of regulations promulgated pursuant to the Comprehensive Iran Sanctions Accountability, Divestment Act of 2010. Prior to Elaf’s removal, it was one of two banks on the Part 561 List, the other being Kunlun Bank.

In their press release concerning Elaf’s removal, Treasury cited the fact that Elaf undertook a number of steps which led to their removal, which by OFAC standards occurred very rapidly. First, Elaf engaged Treasury immediately upon their designation. Second, Elaf appropriately identified the basis of their designation, the provision of significant financial transactions for Export Development Bank of Iran (EDBI), and took steps to terminate that relationship. Those steps included freezing EDBI’s accounts, and reducing their overall exposure to the Iranian financial sector. As I have noted previously, speed, accurate identification of the basis of the designation, and addressing that basis, are the keys to being removed from the OFAC Specially Designated Nationals and Blocked Persons List (SDN List). It appears the same holds true for the Part 561 List, which follows the same administrative removal process as the SDN List.

Treasury’s actions demonstrate once again that removal of an OFAC designation is possible if addressed in the appropriate manner. Foreign financial institutions still dealing with Iran may want to pay heed to the actions of Elaf. The U.S. Congress and many pro sanctions groups in Washington are pushing for more aggressive enforcement and implementation of the types of sanctions that Elaf faced. If they get their way, a number of foreign financial institutions may find themselves having to follow the model Elaf set forth for removal from the Part 561 List or from the OFAC SDN List itself.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrariassociatespc.com.

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State and Treasury Split Duties in Designating New Individual and Entities to OFAC SDN List

December 14, 2012 Leave a comment

Yesterday, the United States Departments of State and of the Treasury designated a number of Iranian individuals and entities pursuant to Executive Order (E.O.) 13382. E.O. 13382 targets those parties involved in Iran’s proliferation of weapons of mass destruction activities. Once designated pursuant to this authority, any assets owned or controlled by the designated parties under U.S. jurisdiction are blocked. Moreover, U.S. persons are prohibited from engaging in most transactions with the designated parties. Under E.O. 13382, both the Treasury Department and the State Department have the authority to designate parties for sanctions. Treasury’s designations are administered through the Office of Foreign Assets Control (“OFAC”) who also maintain the list of Specially Designated Nationals and Blocked Persons (SDN List) in which these designated parties names will now appear.

OFAC designated the following individuals and entities: Fereidoun Abbasi-Davani, Morteza Ahmadali Behzad, Seyed Jaber Safdari, Aria Nikan Marine Industry, Iran Pooya, and Pouya Control (Tejarat Gostar Nikan Iranian Company). The State Department added the following designations: Amir Hossein Rahimyar, Mohammad Reza Rezvanianzadeh, Faratech, Neda Industrial Group, Tarh O Palayesh, and Towlid Abzar Boreshi Iran. All of these entities are alleged to have engaged in activities to further Iran’s nuclear proliferation efforts. In addition, these individuals and entities have also had designations under the Iranian Financial Sanctions Regulations placed upon them. This indicates that those foreign financial institutions who deal with these individuals and entities could be subject to secondary sanctions under the Comprehensive Iran Sanctions, Accountability and Divestment Act of 2010 (CISADA).

These individuals do have some recourse under OFAC’s regulations to contest their designation. There is an administrative reconsideration process that can be engaged in with the agency, however, it is often a long and burdensome process involving the production of significant documents and information to OFAC in order to prove that their evidentiary basis for making the designation is flawed. This is a task that becomes even more difficult because OFAC rarely provides any of the information that forms the basis of their designation, leaving the designated party to guess what OFAC’s basis is and to try to provide arguments and evidence to counter that. That said, designations do occur regularly and if any of these blocked parties believe they have been wrongly designated they should pursue such reconsideration.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrariassociatespc.com.

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OFAC Places Two Mali Nationals, One Mali Entity on SDN List

December 10, 2012 Leave a comment

Last Friday, the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) placed two individuals, Hamad El Khairy and Ahmed El Tilemsi, from Mali and one entity in Mali, Movement for Unity and Jihad in West Africa (MUJWA) on the Specially Designated Nationals and Blocked Persons List (“SDN List”) under the authority of Executive Order (E.O) 13224. The targeting of these parties was actually directed by the U.S. Department of State, who also have authority to utilize sanctions under E.O. 13224. E.O. 13224 was issued shortly after September 11, 2001, in an effort to give the U.S. additional authorities under which to apply economic sanctions to parties engaged in international terrorism and those providing material support to those engaged in such activities. As a result of these designations, U.S. persons can no longer engage in any transactions with the designated parties and any assets under U.S. jurisdiction belonging to those parties are to be blocked.

In addition to their E.O. 13224 designation, MUJWA is also listed by the United Nations 1267/1989 al-Qa’ida Sanctions Committee. As part of their UN listing all member states are ordered to implement assets freezes, travel bans, and arms embargoes against MUJWA. When effectively implemented UN sanctions can be extremely effective, much more so than unilateral sanctions such as the one imposed by the U.S. In addition, UN sanctions may procedurally be more sound than the U.S. sanctions regime, as those designated under UN sanctions have recourse to challenge their designation through submission of the case to an independent Ombudsman who reviews the cases to determine whether or not the designation was made in error or whether the circumstances had changed to such a degree that the designation was no longer warranted. At a meeting last week in New York, it was confirmed that in the overwhelmingly majority of cases reviewed by the Ombudsman that the recommendation was ultimately made to remove the designated party from the sanctions list.

OFAC also allows for reconsideration of the designations made to the Specially Designated Nationals and Blocked Persons List (SDN List), whether they be made by Treasury or State. However, in that process there is no independent arbiter to review the designation, the review is often carried out by the very same officials that placed the party on the list in the first place. In addition, OFAC is under no mandated timeline to process the reconsideration, and I personally have worked on cases where the reconsideration has been pending for nearly eight years. Finally, OFAC will also turn over very little, if any evidence, serving as the basis of the designation, opting instead to engage in back and forth communications with the designated party where OFAC requests additional information and the designated party supplies such information. Once OFAC is satisfied with the information it has received it makes its decision as to whether to rescind the designation.

Despite the problems with the OFAC SDN reconsideration process, parties are frequently removed from the list. As such, any party seeking to have such a designation reconsidered should engage with OFAC as soon as possible and begin the steps towards removing their designation.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrariassociatespc.com.

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OFAC Issues New Kingpin, Terrorist SDN Sanctions

November 20, 2012 Leave a comment

Today the United States Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) announced two sets of designations. The first targeted the Ibarra Cardona Drug Trafficking Network. The other targeted a hawala operation with alleged ties to the Taliban.

The hawala operation, Rahat Ltd., has branches in Afghanistan, Pakistan, and Iran which OFAC states have been used by the Taliban to facilitate their illicit financial activities. OFAC also designated the owner of Rahat Ltd, Mohammed Qasim, and the owner and manager of its Quetta, Pakistan branch, Musa Kalim. OFAC believes the hawala operation has been involved in providing financial services to the Taliban’s shadow governor for Helmand Province Barich. Allegedly, these services are used to pay other Taliban commanders to carry out operations in Southern Afghanistan as well and last year $500,000 of Taliban money was deposited in Rahat’s Quetta, Pakistan branch, while hundreds of thousands of dollars in Taliban accounts flowed through Rahat.

The other set of designations targeted five individuals and three entities in Tijuana, Mexico. These parties are alleged to have been involved in the Sinaloa Cartel’s methamphetamine production by providing the Cartel with precursor chemicals needed for meth production.

As is the case with almost all OFAC designations on the Specially Designated Nationals and Blocked Persons List (“SDN List”), any assets falling under U.S. jurisdiction belonging to these parties will be blocked and U.S. persons are prohibited from engaging in transactions with such designated parties.

All of these designations can be challenged under 31 C.F.R. 501.807, the Treasury regulation which outlines the administrative reconsideration process of SDN listings. To effectively challenge a designation under that regulation, the party designated must submit evidence and arguments to show either a case of mistaken identity in the designation, or a change of circumstances sufficient to warrant a delisting. Although, I have assisted a number of parties in being removed from the list, it is often a difficult task and requires a tremendous amount of patience. If any of those parties targeted today wish to seek a reconsideration, they have likely have a long road ahead of them.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrari-legal.com.

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OFAC Makes Large Scale Designation Under the Kingpin Act

August 15, 2012 Leave a comment

Today, the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced the designation of two individuals and a number of entities under the Foreign Narcotics Kingpin Designation Act (Kingpin Act). The two individuals designated, Christina Stetanel Castellanos Chacon and Maria Corina Saenz Lehnhoff, were Guatemalan nationals who are believed by OFAC to be engaged in the laundering of narcotics trafficking proceeds on behalf of Marllory Chacon Rossell. In addition to these two individuals were twenty-four (24) entities designated including a hotel, a construction company, an import-export company, a clothing store, and a household goods store. It is believed by OFAC that all of these companies were used as fronts for laundering proceeds of illegal narcotics sales.

Under the Kingpin Act there are two types of designations: Tier I designations and Tier II designations. Tier I designations are made by the President on or about June 1st of every year and identifies those individuals who are believed to be significant foreign narcotics traffickers. The Tier II designations are made by OFAC and identify those parties believed to be providing materials support or assistance to the Tier I kingpins. Tier II designations can be made at any time of the year and are made frequently.

It is interesting to note that there have been cases where Tier I Kingpin designations were placed upon individuals who were considered U.S. persons, particularly U.S. permanent legal residents. This presents an issue of whether or not a party can be designated as a significant foreign narcotics trafficker if they are actually not a foreign person. The case law on the issue is pretty much non-existent and from what I have seen and heard OFAC has not found such arguments compelling when considering a reconsideration of the designation. That said, it would be interesting to see how a court would deal with an OFAC Kingpin with U.S. person status contesting their designation as a significant foreign narcotics trafficker on the basis that they are not a foreign person. We may see this argument employed sooner or later and I think it’s an important question that needs to be settled by the courts.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrari-legal.com.

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Seeking Help in Expediting an OFAC SDN Reconsideration?

July 29, 2012 Leave a comment

Removing a Specially Designated National (“SDN”) designation imposed by the United States Department of the Treasury’s Office of Foreign Assets Control can be a very difficult process. Often times when contesting such a designation it takes months, and sometimes even years, for OFAC to respond to the a petition for reconsideration, and even then they only ask more questions which could have or should have been asked earlier. In order to expedite the process of seeking an OFAC SDN reconsideration follow these three key rules:

1. Submit early: The OFAC SDN reconsideration process is long and in almost all cases takes at least a few years to resolve. As such, as soon as the circumstances warrant a reconsideration of the designation a reconsideration should be submitted. In some cases this may be upon designation if the designation was made in error, or in cases of changed circumstances, the reconsideration should be made once connections with other designated parties are severed or the conduct engaged in has ceased.

2. Provide official documentation: Although OFAC often relies upon newspaper reports, it doesn’t mean that you should. Any type of official and/or legal documentation showing ownership and assets should be provided to OFAC to show that there is no criminal background of the party requesting reconsideration and there is no shared assets or ownership by other SDNs. Any documentation can be helpful, but official and legal documentation are the most compelling to OFAC.

3. Lean on home countries to assist: OFAC has limited resources and personnel to handle reconsiderations. As such, responding to requests becomes a matter of priority, and priority is generally dicatated by who needs to be responded to. As such, a request for reconsideration is going to receive less attention coming from a private individual with no follow up by that party’s home country, then it would if the home country was requesting information on the reconsideration through diplomatic channels. Thus, once a request for reconsideration is submitted, it is useful to have officials from the designated party’s home country or their embassy communicate with OFAC regarding the reconsideration.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrari-legal.com.

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OFAC Makes New Designations Pursuant to Somalia Sanctions

July 5, 2012 Leave a comment

Today the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated six (6) individuals they believe to be engaged in fueling violence and instability in Somalia. These individuals included two Eritrean government officials, Tewolde Negash and Taeme Goitom; a Sudanese al-Shabaab foreign fighter, Suhayl Salim Muhammad `Abd-el-Rahman (aka Abu-Faris), and three Kenyan al-Shabaab supporters, Abubaker Shariff Ahmed, Omar Awadh Omar and Aboud Rogo Mohammed. The aforementioned individuals are all alleged to have different roles, however, the allegations all have one overarching theme and that is their support of al-Shabaab and al-Qaeda and for activities aimed at the disruption of the Transitional Federal Government in Somalia.

Today’s designations were all made pursuant to Executive Order 13536 which imposed sanctions on those parties engaged in activities threatening the peace, stability, and security of Somolia. As a result of these designations, U.S. persons are prohibited from engaging in transactions with any of the designated parties and any assets owned by the designated parties which are under U.S. jurisdiction have been blocked. Executive Order 13536 is implemented through the President’s authority under the International Emergency Economic Powers Act (IEEPA). Designations made pursuant to IEEPA are much more difficult to remove than those made under the Foreign Narcotics Kingpin Designation Act (Kingpin Act), which is the underlying authority for a much more fluid sanctions program where designated parties come off and on to the list all the time. That said, there is an advantage when dealing with IEEPA based designations as opposed to Kingpin Act based designations, because disclosure of the evidence used in IEEPA designations is permitted under Freedom of Information Act (FOIA), whereas the Kingpin Act doesn’t permit disclosure under FOIA.

The Somalia designations have caused quite a bit of problems for non-governmental organizations (NGOs) providing humanitarian relief in the impoverished country. The reason for this is that it becomes difficult for NGOs, already operating on limited resources, and in high risk areas, to completely avoid those high profile individuals and organizations which have been designated. Any transactions done knowingly or unknowingly with such parties will lead to liability for the NGOs for sanctions violations. As more Somalia designations are made, the higher risk of sanctions violations the NGOs face in Somalia. As such, NGOs have more to worry about in Somalia than just helping alleviate human suffering.

The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or ferrari@ferrari-legal.com.

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