Today, OFAC issued an advisory on the use of exchange houses and trading companies to evade the sanctions imposed on Iran:
As the international community has increasingly barred or restricted Iranian financial institutions from accessing the international financial system, Iran is relying more heavily on third-country exchange houses and trading companies to move funds.1 The Office of Foreign Assets Control (“OFAC”) is issuing this Advisory to highlight some of the practices used to circumvent U.S. and international economic sanctions concerning Iran. The practices involve the use of third- country exchange houses or trading companies that are acting as money transmitters to process funds transfers through the United States in support of business with Iran that is not exempt or otherwise authorized by OFAC.2, 3 Such entities frequently lack their own U.S. correspondent accounts and instead rely on their banks’ correspondent accounts to access the U.S. financial system; often are located in jurisdictions considered to be high-risk for transactions implicating OFAC sanctions; and appear to process primarily commercial transactions rather than personal remittances.
The evasive practices identified by OFAC involve transactions omitting references to Iranian addresses; omitting the names of Iranian persons or entities in the originator or beneficiary fields; and transmitting funds from an exchange house or trading company located in a third country to or through the United States on behalf of an individual or company located in Iran or on behalf of a U.S.-designated person without referencing the involvement of Iran or the designated persons.
There are a number of explanatory footnotes, too, so it may be worthwhile to go get the PDF listed below.