• Deanna Clark-Esposito

*NEW* - Increased Fines for OFAC Penalties

Updated: Jul 1, 2019

The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is a financial and intelligence agency that is responsible for the enforcement of economic and trade sanctions that both support US national security and align with foreign policy.

As of June 14, 2019, OFAC has implemented a regulatory amendment pursuant to the “Federal Civil Penalties Inflation Adjustment Act” (FCPIA) of 1990 as amended by the “Debt Collection Improvement Act” of 1996 and the “Federal Civil Penalties Inflation Adjustment Act Improvements Act” of 2015.

The “Federal Civil Penalties Inflation Adjustment Act Improvements Act” of 2015 mandates that federal agencies with statutory authority adjust for inflation on an annual basis. OFAC can issue civil monetary penalties (CMPs) for noncompliance, and the amendment adjusts the maximum amount for a CMP to the current strength of the US dollar. For OFAC, the purpose of accounting for inflation is to ensure CMPs maintain their deferring power in relation to violations.

OFAC is authorized to issue CMPs in relation to the following five statutes:

1. the Trading With the Enemy Act (TWEA);

2. the International Emergency Economic Powers (IEEPA);

3. the Antiterrorism and Effective Death Penalty Act of 1996 (AEDPA);

4. the Foreign Narcotics Kingpin Designation Act (FNKDA);

5. and the Clean Diamond Trade Act (CDTA).

The previous maximum CMP amount and the new maximum CMP amounts for each statute are:

1. TWEA: Previous - $86,976 / New - $89,170

2. IEEPA: Previous - $295, 141 / New - $302, 584

3. AEDPA: Previous - $77,909 / New - $79,874

4. FNKDA: Previous - $1,466,485 / New - $1,503,470

5. CDTA: Previous - $13,333 / New - $13,669

For more information on the amendment, follow this link: https://www.treasury.gov/resource-center/sanctions/CivPen/Documents/fr84_27714.pdf

The updated CMP amounts accentuate the importance of OFAC compliance, and the costly ramifications of violations.

If you have any questions about OFAC sanctions or CMPs, feel free to send us a message through the Contact form on the Home Page.


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