Note: Today’s post is part of our “Editor’s Pick” series where we highlight recent posts published by our sponsors that provide practical knowledge and advice on timely and important supply chain and logistics topics. This post from Amber Road’s blog discusses the Office of Foreign Assets Control (OFAC) and how its enforcement arm reaches all over the world.
When you think sanctions, there are a few things that probably come to mind: Iran, North Korea, possibly Russia. You may envision munitions being smuggled in Cold War-era trucks by rogue factions of defunct military groups. You may think only bad actors such as known terrorists are direct targets of US sanctions, and only companies that operate within the US are subject to sanctions rules. If you think this, you’d be wrong.
The Office of Foreign Assets Control (OFAC)
The agency responsible for US sanctions is the Office of Foreign Assets Control (OFAC), a division of the US Treasury Department. OFAC’s sole function is to enforce the economic and foreign policy goals of the executive branch of the US government, and the primary way it does this is through economic and trade sanctions. OFAC puts in place sanctions on specific nations or entities to prevent groups that are deemed a threat from getting access to resources such as technology, funds, and even aid and shelter. It also has the power to enforce those sanctions by placing crippling fines and penalties, criminal liability, and loss of trade privileges on individuals or companies that violate the sanctions.
Of course, any company based in the US is subject to OFAC’s jurisdiction. So are companies that operate within the US or import to the US. But OFAC’s reach is much, much broader than this. In fact, in light of recent enforcement actions OFAC has taken…