OFAC gets a two-fer on enforcement actions

Keystone Cops time – Kanawha Insurance Company, a subsidiary of Humana, serviced policies for AXA Equitable. Neither firm screened policyholders – perhaps they assumed the other was doing it. And they missed three SDNs designated under the narcotics trafficking sanctions program. Oops.

Why a Finding of Violation? Here’s what OFAC had to say on the matter in the AXA enforcement action:


A Finding of Violation is appropriate given that 

  • AXA is a large and commercially sophisticated financial institution; 
  • AXA facilitated and/or processed 34 payments totaling $14,406.19, and maintained two health insurance policies in which one or more SDNs had an interest; 
  • AXA’s failure to identify and block these policies caused harm to the integrity of the FNKSR and its associated policy objectives; and 
  • AXA’s OFAC compliance program does not appear to have ensured that the names of policyholders associated with policies the company issued that were administered and/or serviced by the original TPA were screened or reviewed for OFAC compliance purposes. 

OFAC also considered that 

  • no AXA personnel, including managers or supervisors, appear to have had actual knowledge of the conduct that led to the violations; 
  • AXA has not received a penalty notice or Finding of Violation from OFAC relating to substantially similar violations in the five years preceding the date of the conduct giving rise to the violations; and 
  • AXA cooperated with OFAC’s investigation, including by voluntarily self-disclosing the violations to OFAC and by executing a statute of limitations tolling agreement and an extension to the agreement. 


OFAC Notice

AXA Equitable Enforcement Action

Humana Enforcement Action

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