The Treasury Department’s Office of Foreign Assets Control (OFAC) set a record June 12 with its $619 million settlement with ING Bank N.V. related to violations of U.S. sanctions against countries including Cuba and Iran. Other recent high-profile OFAC settlements include a
$536 million settlement with Credit Suisse AG, a $217 million settlement with Lloyds TSB, a
$176 million settlement with Barclays and an $88 million settlement with JPMorgan Chase, all related to violations of U.S. sanctions.
OFAC Director Adam Szubin said in a statement announcing the June 12 ING settlement, “Today’s historic settlement should serve as a clear warning to anyone who would consider profiting by evading U.S. sanctions.”
“Not only is OFAC applicable to all U.S. companies, but now its reach really extends worldwide,” Lee says. “Except for the Cuba sanctions, which apply to foreign subsidiaries of U.S. companies, the law by its terms doesn’t apply to foreign companies, even if those foreign companies are wholly owned by U.S. companies, but little by little, OFAC has engaged in this creeping extraterritoriality.”
“Unless there’s some relation to a U.S. company, OFAC doesn’t have jurisdiction over foreign companies, so here they tried to say, ‘We don’t have jurisdiction, but if we find out you’re helping other companies to evade the sanctions we have in place for Iran or Syria, we’re going to put you on this list,’” Lee says. “That’s a huge stick.”