More Information on the Removal of Bank of Khartoum from OFAC’s SDN List

Some new details have been leaked concerning the removal of Bank of Khartoum from the list of Specially Designated Nationals (SDNs) administered by the United States Department of the Treasury Office of Foreign Assets Control (OFAC). Last week Bank of Khartoum was removed from the SDN List, where it had been identified and targeted for U.S. economic sanctions since 1997. As such, Bank of Khartoum and its 50 branches in Sudan are no longer feeling the pressure of OFAC sanctions.

Although, OFAC did not elaborate on the details surrounding Bank of Khartoum’s SDN removal, U.S. officials with insight into the matter state that OFAC’s decision was motivated by the bank no longer being under the control of the Sudanese government. Indeed, Bank of Khartoum was privatized in 2002 and is now controlled by Dubai Islamic Bank which holds 60% of its shares and has since 2005. Bank of Khartoum was just one of 163 Sudanese entities included on the SDN list.

The Sudan has been targeted for sanctions since 1997, however, there has been much said about removing these sanctions once the crisis in Darfur has been resolved. In the past month, OFAC has issued guidance stating that that South Sudan Republic (SSR), whose official declaration is expected July 9, 2011, will be exempt from the sanctions imposed on the Sudan for the last two decades. While visiting Washington recently, the secretary-general of the SPLM North Sudan, Yasir Arman, called upon the U.S Government maintain sanctions against the Sudan until President Omer Al-Bashir demonstrated a commitment to democratic reform.

In order to be removed from the OFAC SDN List, the party requesting the removal must provide evidence and arguments to demonstrate that either there was a case of mistaken identity in regards to OFAC’s designation determination or that the circumstances surrounding the SDN designation have changed to a degree which warrants the removal from the list. The OFAC SDN removal process can be long and lengthy, however, as evidenced by the removal of Bank of Khartoum it is possible to be removed from this list.

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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