Q: What is the source of U.S. sanctions against Transnational Criminal Organizations (TCOs)?
A: OFAC’s Transnational Criminal Organizations sanctions program began on July 24, 2011 when the President issued Executive Order 13581 (E.O. 13581), which declared a national emergency to address the threat of significant transnational criminal organizations to national security, foreign policy, and the economy of the United States. In 2012, OFAC issued regulations to implement E.O. 13581, called “Transnational Criminal Organizations Sanctions Regulations” (31 C.F.R. Part 590).
Q: What are the regulations in relation to TCOs?
A: OFAC’s Transnational Criminal Organization sanctions are designed to block the property and interests of all persons listed under the E.O. 13581 authority by the Secretary of the Treasury, in consultation with the Attorney General. Persons listed by OFAC will have been considered by the Department of Treasury to be a foreign person that constitutes a significant transnational criminal organization, to have materially assisted or provided support to persons or interests present on the SDN list, or to have been owned, controlled by, or to have acted on behalf of those present on the SDN List.
Q: How do I know if I have been listed by OFAC on the SDN List?
A: All SDN lists are published through the US Department of Treasury’s OFAC website and are updated regularly (for new inclusions and removals) here: https://www.treasury.gov/resource-center/sanctions/SDN-List/Pages/default.aspx
Q: What are the penalties associated with violations to the OFAC SDN TCO designation?
A: As per OFAC guidance: “Civil monetary penalties of up to the greater of $250,000 or twice the amount of the underlying transaction may be imposed administratively against any person who violates, attempts to violate, conspires to violate, or causes a violation of E.O. 13581 or the Regulations. Upon conviction, criminal fines of up to $1,000,000, imprisonment for up to 20 years, or both, may be imposed on any person who willfully commits or attempts to commit, or willfully conspires to commit, or aids or abets in the commission of a violation of E.O. 13581 or the Regulations. This document is explanatory only and does not have the force of law. Please see particularly E.O. 13581 and the Regulations for the legally binding provisions governing the sanctions. This document does not supplement or modify E.O. 13581 or the Regulations.”
Q: How does this affect U.S. persons?
A: U.S. persons are prohibited from engaging in any transaction or dealing with a designated person or entity or that person's or entity’s property. There are strict criminal penalties if a U.S. person violates the sanctions.