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Monday
May112015

Compliance alert: OFAC issues report on blocked terrorist assets

Last week OFAC -- the Office of Foreign Assets Control -- issued its 23rd report to congress detailing blocked assets in the U.S. belonging to terrorist organizations and state sponsors of terrorism.

The blocked assets in total are worth about $2.3 billion. Most belong to Iran.

Blocked Iranian cash and property in the United States are valued at around $1.9 billion. Included are eleven diplomatic and consular properties in California, Illinois, Maryland, New York, Texas, and Washington, D.C.

Iran's state-owned Bank Melli also has a blocked interest in a building in New York held through Assa Corp. and two affiliates.

Among designated terrorist organizations, Al Qaida tops OFAC's report with about $12.8 million in blocked U.S. assets.

Hizballah's blocked assets in the U.S. are worth $7.1 million, and blocked Hamas assets are valued at $1.2 million.

OFAC lists four other organizations with small amounts of blocked U.S. assets.

The president and executive branch designate terrorist organizations.

According to OFAC,

U.S. persons are prohibited from conducting unauthorized transactions or having other dealings with or providing services to the designated individuals or entities. Foreign persons may be held liable for effecting such transactions from or through the United States. Any property or property interest of a designated person that comes within the possession or control of a U.S. person is blocked and must be reported to OFAC.

Who are U.S. persons under the blocking sanctions? All U.S. citizens, U.S. permanent resident aliens, and foreign nationals present in the United States, as well as U.S. citizens and U.S. permanent resident aliens abroad, corporations organized under U.S. law, foreign companies’ branches and subsidiaries located in the United States, and foreign branches of U.S. companies.

Terrorist countries or state sponsors of terrorism for purposes of OFAC's report are those designated by the secretary of state under the Export Administration Act, the Arms Export Control Act, and the Foreign Assistance Act. States currently designated as sponsors of terrorism are Cuba, Iran, Sudan, and Syria.

Among them, Iran's $1.9 billion in blocked assets tops OFAC's report. Cuba follows with about $270 million in blocked U.S. assets, including six properties in New York and Washington, D.C.

Syria's blocked U.S. assets are worth $78 million. It owns four blocked properties in New York and the District of Columbia.

And Sudan's blocked assets are valued at nearly $28 million, with six blocked properties in New Jersey, New York, Virginia, and Washington, D.C.

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OFAC's Terrorist Assets Report for Calendar Year 2014: The Twenty-third Annual Report to the Congress on Assets in the United States Relating to Terrorist Countries and International Terrorism Program Designees is here (pdf).

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.