OFAC Sanctions List – Keys for Getting Removed
Placement on an OFAC sanctions list can have severe consequences. In most cases, this involves being labeled as a specially designated national (SDN). However, while the Office of Foreign Assets Control (OFAC) routinely places individuals and entities on the SDN list, it also regularly removes individuals and entities from the list as well, and there are designated procedures in place for requesting removal.
Getting removed from an OFAC sanctions list (i.e., the SDN list) involves dealing with OFAC directly. As OFAC explains:
“Each year, OFAC removes hundreds of individuals and entities from the SDN List. Each removal is based on a thorough review by OFAC. Maintaining the integrity of U.S. sanctions is a high priority for OFAC and is the driving principle behind its rigorous review process that evaluates every request for removal individually on its merits and applies consistent standards to all of them.”
Due to the severe consequences of being subject to OFAC sanctions, all individuals and entities that are subject to sanctions should consult with an OFAC attorney about seeking removal. On the same token, as prosecuting a request for removal can be a lengthy and time-intensive process, sanctioned individuals and entities should not pursue removal unless it makes sense to do so. At Oberheiden P.C., we have extensive experience representing clients in OFAC matters. We can use our experience to carefully evaluate your options, and we can represent you in seeking removal from the SDN list if warranted.
Grounds for Seeking Removal from OFAC’s SDN List
While OFAC has not issued specific guidance on the grounds for seeking removal from the SDN list, most requests for removal are based on one of three issues. These are: (i) improper placement on the SDN list; (ii) mistaken identity; and, (iii) a change in circumstances that warrants removal.
1. Improper Placement on the SDN List
Individuals and entities can seek removal from the SDN list at any time if they have been placed on the list improperly. The SDN list is intended to prevent financial transactions involving “individuals and companies owned or controlled by, or acting for or on behalf of, targeted countries,” as well as “individuals, groups, and entities, such as terrorists and narcotics traffickers designated under programs that are not country-specific.”
OFAC administers several sanctions programs, and an individual or entity can be placed on the SDN list if any of OFAC’s sanctions apply. The breadth of OFAC’s sanctioning efforts means that there are tens of thousands of specially designated nationals—but it also means that some individuals and entities get designated improperly.
Our attorneys can determine if you or your organization has been improperly placed on the SDN list; and, if so, we can assemble the documentation and other evidence needed to prove it. We can then file a request for removal on your (or your organization’s) behalf. If an OFAC sanctions program applies, we can work with you to achieve and demonstrate a change in circumstances that warrants removal, as discussed in greater detail below.
2. Mistaken Identity
In some cases, an individual’s or organization’s placement on the SDN list is a consequence of mistaken identity. If OFAC has mistakenly placed you or your organization on the SDN list when it intended to label a different individual or organization as a specially designated national, we can work with OFAC on your behalf to correct the error and secure removal.
3. Change in Circumstances that Warrants Removal
Even if OFAC validly placed you or your organization on the SDN list in compliance with the International Emergency Economic Powers Act (IEEPA), Trading with the Enemy Act (TWEA), or other applicable law, this placement is not permanent. If your (or your organization’s) circumstances have changed such that the SDN label is no longer warranted, we can file a request for removal with OFAC that outlines the changed circumstances.
If you need to seek removal from the SDN list but have not yet achieved a sufficient change in circumstances, our attorneys can also guide you through the process of becoming eligible for removal. This can involve varying layers of complexity depending on the reason for OFAC’s designation and the scope of your (or your organization’s) foreign relationships and financial transactions. Once we determine what steps are necessary, we can then assist you with taking these steps and generating the documentation needed to convince OFAC that the SDN label is no longer justified.
Filing a Request for Removal (Request for Reconsideration) with OFAC
Regardless of the grounds for seeking removal from the SDN list, the process starts with filing a request for removal (or “request for reconsideration”) with OFAC. As OFAC explains, “To request removal from any OFAC sanctions list, including the SDN List, simply write to OFAC and request removal. This begins the OFAC removal review process.”
However, submitting a request for reconsideration is far from a simple process.
Along with the petition itself, individuals and entities seeking removal from an OFAC sanctions list will need to submit adequate supporting documentation—and this documentation will be voluminous in many cases. At the same time, those seeking removal must also be careful to preserve the attorney-client privilege (i.e., by redacting communications and other documents) and avoid inadvertently disclosing any potentially harmful information to OFAC.
Filing this request is just the start of the process. As stated in 31 C.F.R. Section 501.807(d), “After [OFAC] has conducted a review of the request for reconsideration, it will provide a written decision to the blocked person.” OFAC may also request additional documentation, require the completion of questionnaires, and seek additional information through other means. Parties seeking removal must continue to work with OFAC throughout the process, while continuing to take care to protect their other legal and financial interests as well.
5 Keys to Getting Removed from an OFAC Sanctions List
In all cases, there are steps that individuals and entities that are subject to OFAC sanctions can (and generally should) take to improve their chances of securing removal. Some examples of these steps include:
1. Conduct an Audit to Determine Removal Eligibility
Before filing a request for removal, it is essential to thoroughly assess your (or your company’s) removal eligibility. Again, if you or your company is not eligible for removal, then you should focus your efforts and resources elsewhere—such as on achieving a change in circumstances that will justify a request for reconsideration.
Making this assessment involves conducting a detailed audit. When you engage Oberheiden P.C., our attorneys will examine all pertinent records in order to determine whether you or your company is eligible for removal—and, if not, what additional steps are needed.
2. Gather All Pertinent Documentation
Before filing a request for reconsideration, it is critical to gather all pertinent documentation. OFAC expects individuals and entities seeking removal to be forthcoming, and any appearance or perception that you or your company may be withholding information will almost certainly lead to a denial. Gathering the necessary records up front ensures not only that we have all necessary information to prepare your request, but that we are prepared to respond to any inquiries from OFAC as well.
3. Carefully Craft the Request for Reconsideration
Requests for reconsideration submitted to OFAC must be carefully crafted to address all pertinent facts and circumstances. A comprehensive and well-drafted request can facilitate productive communications with OFAC, while deficient requests can lead to unnecessary challenges and delays. Our attorneys will craft your request, ensuring that it contains all of the information that OFAC will need to issue a favorable decision.
4. Anticipate OFAC’s Questions and Concerns
When preparing the request for reconsideration, it is also important to anticipate OFAC’s questions and concerns. Generally, it will make sense to address these questions and concerns proactively in the request itself. By viewing your (or your company’s) request from OFAC’s perspective, our attorneys can minimize the chances of a prolonged process and an unwarranted denial.
5. Work with Experienced OFAC Counsel Throughout the Process
For individuals and entities seeking removal from an OFAC sanctions list, including the SDN list, it is important to work with experienced OFAC counsel throughout the process. You should not wait until something goes wrong to engage an attorney to deal with OFAC on your behalf. When we are able to control the entire process, we are also able to gain significant control over the outcome; and, while there are no guarantees, this approach has generally proven to be effective for securing removal.
Speak with an OFAC Sanctions Attorney at Oberheiden P.C. in Confidence
Do you need to know more about filing a request for removal from the SDN list (or another OFAC sanctions list)? If so, we encourage you to schedule a confidential initial consultation at Oberheiden P.C. We represent individuals and organizations throughout the United States and worldwide. To speak with one of our senior OFAC sanctions attorneys in confidence as soon as possible, please call 888-680-1745 or tell us how we can reach you online today.
Dr. Nick Oberheiden, founder of Oberheiden P.C., focuses his litigation practice on white-collar criminal defense, government investigations, SEC & FCPA enforcement, and commercial litigation.