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Barclays Bank settles potential OFAC liability

02/08/2016
Fine Amount: 
$2,485,890
Penalty Type: 
Issued by: 

The Treasury Department's Office of Foreign Assets Control has released a notice of a settlement agreement with Barclays Bank Plc, London, England. Barclays has agreed to remit $2,485,890 to settle its potential civil liability for 159 apparent violations of the Zimbabwe Sanctions Regulations, 31 C.F.R. part 541 (ZSR). From July 2008 to September 2013, Barclays processed 159 transactions totaling approximately $3,375,617 to or through financial institutions located in the United States – including Barclays’ New York branch (“Barclays NY”) – for or on behalf of corporate customers of Barclays Bank of Zimbabwe Limited (“BBZ”) that were owned 50 percent or more, directly or indirectly, by a person identified on the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) List of Specially Designated Nationals and Blocked Persons (the “SDN List”). Barclays experienced operational problems with its OFAC screening systems beginning in 2005, and BBZ's Know Your Customer procedures were ambiguous and hard to follow. Outdated beneficial ownership information in BZZ's systems made Barclays UK incapable of screening that information effectively. OFAC included the following warning in its notice:

"This enforcement action highlights the importance for institutions with operations in countries with a significant presence of persons (individuals and entities) on the SDN List to take appropriate measures to ensure compliance with U.S. economic sanctions when processing transactions for or on behalf of their customers to, through, or within the United States."

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