On February 18, 2021, the U.S. Department of the Treasury, Office of Foreign Assets Control (OFAC) announced a $507,375 settlement with BitPay, Inc. (BitPay), a payment processor for merchants accepting digital currency as payment for goods and services, for 2,102 apparent violations of multiple sanctions programs between 2013 and 2018.[1] The settlement highlights that financial service providers facilitating digital currency transactions must not only establish sanctions compliance programs to screen their own customers but also must monitor third-party non-customer transaction information.
Continue Reading OFAC Settles with Digital Currency Payment Processor for Sanctions Violations
Michael G. Sanders
Congress Overhauls AML Framework, Mandating Disclosure of Beneficial Ownership Information
By David E. Brodsky, Abena Mainoo, Derek M. Bush, Katherine Mooney Carroll, Paul Marquardt, Patrick Fuller & Michael G. Sanders on
As part of the National Defense Authorization Act for 2021 (the “NDAA”), Congress has passed the most significant U.S. anti-money laundering (“AML”) legislation since the USA PATRIOT Act of 2001, the “Anti-Money Laundering Act of 2020” (“AMLA 2020”).
Although President Trump has threatened to veto the NDAA, the majorities supporting the legislation would be sufficient…
District Court Decision Incorrectly Holds that OFAC Sanctions Bar PdVSA from Making Payment on Pre-Sanctions Debts
By Paul Marquardt & Michael G. Sanders on
On February 11, 2020, Judge Stanton of the U.S. District Court for the Southern District of New York denied Dresser-Rand Company’s (Dresser Rand) motion for summary judgment in a suit to collect on a promissory note issued by Petróleos de Venezuela, S.A. (PdVSA). The Court’s decision turned on a finding that payment by PdVSA was legally impossible under U.S. sanctions. That finding was based on incomplete briefing by the parties and appears seriously flawed given the licenses and guidance provided by the Department of Treasury’s Office of Foreign Assets Control (OFAC). We discuss the decision and the U.S. sanctions regime as applied to the promissory note below.
Continue Reading District Court Decision Incorrectly Holds that OFAC Sanctions Bar PdVSA from Making Payment on Pre-Sanctions Debts
United States Designates the Government of Venezuela for Blocking Sanctions
By Paul Marquardt, Nathanael Kurcab & Michael G. Sanders on
On August 5, 2019, the U.S. Administration imposed blocking sanctions on the Government of Venezuela (“GOV”) under a new executive order. Although named individual officials, the Central Bank of Venezuela, and Petróleos de Venezuela, S.A. (“PdVSA”) were already blocked entities under U.S. sanctions, now all Venezuelan government entities and state-owned enterprises are blocked entities.
Unless…
Cuba Sanctions Tighten: OFAC Limits Cuba Travel
By Paul Marquardt & Michael G. Sanders on
Today, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) and the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) each announced changes to the Cuba sanctions rules. OFAC is amending the Cuban Assets Control Regulations (CACR) to end group educational or cultural visits referred to as “people-to-people” educational travel, one of the major categories permitting non-family travel to Cuba. People-to-people educational travel that was previously authorized will be allowed where the traveler has already completed at least one travel-related transaction (such as purchasing a flight or reserving accommodation) prior to June 5, 2019. These amendments follow similar changes to CACR made on November 9, 2017 that removed authorization for individual people-to-people visits to Cuba. OFAC also released an updated set of frequently asked questions regarding Cuba sanctions.
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Venezuela Sanctions Tighten: OFAC Sanctions the Venezuelan Central Bank and Senators Propose Sanctions Legislation
By Paul Marquardt & Michael G. Sanders on
On April 17, 2019, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced that the Central Bank of Venezuela has been designated as a specially designated national (SDN) under Executive Order 13850, banning all transactions within U.S. jurisdiction in which it has an interest. As a result, any party who materially assists, sponsors, or provides financial, material, or technological support for, or goods or services to or in support of, the Central Bank of Venezuela now risks designation, whether or not the transaction takes place within U.S. jurisdiction.
Continue Reading Venezuela Sanctions Tighten: OFAC Sanctions the Venezuelan Central Bank and Senators Propose Sanctions Legislation