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01/13/2017

OFAC guidance on provision of services under sanctions laws

OFAC has announced the publication of guidance on the provision of certain services relating to the requirements of U.S. sanctions laws (the “Compliance Services Guidance”). The Compliance Services Guidance does not reflect a change in OFAC’s policy with respect to the provision of these types of legal and compliance services. The Compliance Services Guidance responds to numerous inquiries received by OFAC, many from foreign companies at outreach events, relating to whether U.S. persons, including U.S. attorneys and compliance personnel, may provide certain services described in that guidance. OFAC is also publishing a number of new Frequently Asked Questions pertaining to the Compliance Services Guidance.

01/13/2017

OFAC adds non-proliferation and Syria designations

OFAC has announced it has taken action in response to the Organization for the Prohibition of Chemical Weapons (OPCW) - United Nations (UN) Joint Investigative Mechanism (JIM) findings that the Syrian regime used industrial chlorine as a weapon against its own people. OFAC is designating 18 senior regime officials connected to Syria’s weapons of mass destruction program and identifying five Syrian military branches as part of the Government of Syria. Any property or interest in property of the identified persons in the possession or control of U.S. persons or within the United States must be blocked. Additionally, transactions by U.S. persons involving these persons are generally prohibited. See our OFAC Update for more information.

01/13/2017

New York issues updated cybersecurity regs

The New York State Department of Financial Services (DFS) has announced that it has updated its proposed first-in-the-nation cybersecurity regulation to protect New York State from the ever-growing threat of cyber-attacks. The proposed regulation, which will be effective March 1, 2017, will require banks, insurance companies, and other financial services institutions regulated by DFS to establish and maintain a cybersecurity program designed to protect consumers and ensure the safety and soundness of New York State’s financial services industry. The updated proposed regulation, which was submitted to the New York State Register on December 15, and published on December 28, will be finalized following a 30-day notice and public comment period.

01/12/2017

OFAC sanctions North Korean officials and agencies

OFAC has designated seven individuals and identified as blocked two entities of the North Korean regime in response to the regime’s ongoing and serious human rights abuses and censorship activities. Treasury is taking this action in conjunction with the State Department’s “Report on Serious Human Rights Abuses or Censorship in North Korea,” which is being submitted in accordance with the North Korea Sanctions and Policy Enhancement Act of 2016. As a result of these actions, any property or interest in property of those designated by OFAC within U.S. jurisdiction is frozen. Additionally, transactions by U.S. persons involving the designated persons are generally prohibited. The identifications of two entities as blocked were issued pursuant to E.O. 13722, which, among others, blocks the property and interests in property of the Government of North Korea and the Workers’ Party of Korea, including those two entities. See our OFAC Update for additional information.

01/12/2017

OCC to fine and bar two FOREX traders

The OCC has issued notices of charges for prohibition and notices of assessment of civil money penalty against Richard Usher, former Head of G10 Spot Trading at JPMorgan Chase Bank, N.A., and Rohan Ramchandani, former Head of European Spot Trading at Citibank, N.A. The OCC also fined Usher and Ramchandani $5 million each for violating the Sherman Antitrust Act, engaging in unsafe or unsound practices, and breaching their fiduciary duties related to their conduct in the foreign exchange (FOREX) market. Concurrent with the OCC’s enforcement action, the Department of Justice also issued indictments against Usher and Ramchandani for violations of the Sherman Antitrust Act. In addition, the Federal Reserve announced enforcement actions against another trader in the Cartel chat room. Usher and Ramchandani may request a hearing challenging their respective notice of charges for prohibition and notice of assessment of civil money penalties. For additional details, see our Penalty page concerning the OCC's announcement.

01/11/2017

OFAC targets ISIL financing and support

Treasury’s Office of Foreign Assets Control (OFAC) has acted to disrupt the Islamic State of Iraq and the Levant’s (ISIL) global fundraising and support network by designating four individuals – Neil Christopher Prakash, Khaled Sharrouf, Bachrumsyah Mennor Usman, and Oman Rochman – as Specially Designated Global Terrorists (SDGTs) pursuant to Executive Order (E.O.) 13224, which targets terrorists and those providing support to terrorists or acts of terrorism. The individuals designated today include ISIL members based in Iraq, Syria, and Indonesia who are involved in ISIL’s propaganda, recruitment, and support networks in Southeast Asia and Australia. As a result of these actions, all property and interests in property of Prakash, Sharrouf, Usman, and Rochman subject to U.S. jurisdiction are blocked, and U.S. persons are generally prohibited from engaging in transactions with them.

OFAC also announced that the State Department has designated Jamaah Ansharut Daulah (JAD) and Alexanda Amon Kotey pursuant to E.O. 13224. JAD is a terrorist group based in Indonesia that was formed in 2015 and is composed of almost two dozen Indonesian extremist groups that pledged allegiance to ISIL leader Abu Bakr al-Baghdadi. Kotey, a British national, is one of four members of the ISIL execution cell known as “The Beatles.”

For links and further information, see our OFAC Update.

01/10/2017

OFAC designates seven for SDN List

OFAC has posted an SDN List Update adding five individuals under Magnitsky Sanctions and two under Counter Terrorism Sanctions. For additional information, see our OFAC Update.

01/09/2017

OFAC announces Cuba updates

Treasury's Office of Foreign Assets Control has updated its FAQs regarding Cuba to add five new FAQs regarding vessel transactions with Cuba. OFAC also updated its Specially Designated Nationals List to remove 28 CUBA-designated listings. For identification information on the individuals and entities removed, see OFAC's SDN List Update.

01/06/2017

OCC adds sales practices to financial institutions risks

The OCC has released its Semiannual Risk Perspective for Fall 2016. which reports on the strategic, credit, operational, and compliance risks facing national banks and federal savings associations. The report includes an added focus on sales oversight, in the aftermath of the Wells Fargo scandal. Other highlights of the report include:

  • Strategic risk remains high as banks consider business model changes and face challenges in growing revenue. Strategic planning remains important as banks adopt innovative products, services, and processes in response to the evolving demands for financial services and the entrance of new competitors, such as out-of-market banks and financial technology firms.
  • Banks continue to ease underwriting practices to boost loan volume and to respond to competition from bank and non-bank lenders. These actions are evident in commercial, commercial real estate and auto lending. The level of risk is increasing due to increased risk layering, rising loan policy exceptions, increasing loan-to-value ratios, and weaker covenant protection.
  • Operational risk remains a concern as banks face changing cybersecurity threats, increased reliance on third-party relationships, and the need for sound governance over sales practices.
  • Banks face challenges meeting the integrated mortgage disclosure requirements and amended Military Lending Act regulatory requirements, and managing Bank Secrecy Act risks.

Comptroller Curry offered remarks during the press call on the report.

01/06/2017

OFAC counter terrorism designations

Treasury's Office of Foreign Assets Control has added two individuals to its SDN List, with the SDGT designation.

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