You know, when OFAC said they were going to focus on larger, more egregious, enforcement actions?
Those days are gone, unfortunately. While I will be posting a more lengthy analysis of this, today we get a $257,862 Civil Monetary Penalty imposed on a firm for some potentially licensable exports to Cuba who misinterpreted OFAC’s regulations.
Usually, if something happens more than once in a blue moon, we look for something systemic that’s at fault. How many Cautionary Letters or No Action letters have gone out for similar misunderstandings of the myriad stuff on the OFAC website?
Perhaps OFAC needs to rethink how its requirements are presented. Do we really need to read multiple pieces of legislation, multiple sets of applicable regulations (in the case of Iran, there are 4), guidance, FAQs, licenses, etc – at the risk of picayune fines for not understanding all of it properly? Is this really a good way to spend our time and tax dollars?
Do we really need to rely on the likes of Hogan Lovells, Baker McKenzie, et al (no flies on them – they’re really impressive at this stuff) in order to insulate ourselves from OFAC’s wrath? And let’s not forget that occasionally lawyers get it wrong, too – there was an action last year where the firm had referred the questions to counsel, but had not properly understood the response.
The jaded part of me thinks this is part of OFAC’s plan – to make this so hard that some of us will just walk away from licensable business. Now, I know this is not completely true, based on the recent pronouncements about humanitarian aid from OFAC Director Gacki… but you have to wonder.
Categories: Enforcement Actions