Office of Foreign Assets Control

Agency overview
Formed	December 1950
Preceding agency	Office of Foreign Funds Control
Headquarters	Washington, D.C.
Employees	Approximately 200 (2013)[1]
Annual budget	$30.9 million (2013)
Agency executive	Bradley T. Smith, Director
Parent department	Department of the Treasury
Website	ofac.treasury.gov

TheOffice of Foreign Assets Control (OFAC) is afinancial intelligence and enforcement agency of theUnited States Treasury Department. It administers and enforces economic and tradesanctions in support of U.S.national security andforeign policy objectives.^[2] Underpresidential national emergency powers, OFAC carries out its activities against foreign governments, organizations (including terrorist groups and drug cartels), and individuals deemed a threat to U.S. national security.^[3]

Founded in 1950 as the Division of Foreign Assets Control, since 2004 OFAC has operated under theOffice of Terrorism and Financial Intelligence within the Treasury Department. It is primarily composed of intelligence targeters and lawyers. While many of OFAC's targets are broadly set by theWhite House, most individual cases are developed as a result of investigations by OFAC's Office of Global Targeting (OGT).^[4]

Sometimes described as one of the "most powerful yet unknown" government agencies,^[4][5] OFAC has the power to levy significant penalties against entities that defy its directives, including imposing fines, freezing assets, and barring parties from operating in the U.S.

Involvement of the U.S. Department of the Treasury in economic sanctions against foreign states dates to theWar of 1812, when SecretaryAlbert Gallatin administered sanctions against theUnited Kingdom in retaliation for theimpressment of American sailors.^[3][6]

Predecessor agencies of the Division of Foreign Assets Control include Foreign Funds Control (FFC), which existed from 1940 to 1947, and the Office of International Finance (1947 to 1950).^[7][8] FFC was established byExecutive Order 8389 as a unit of the Office of the Secretary of the Treasury on April 10, 1940. The authority to establish FFC was derived from theTrading with the Enemy Act 1917. Among other operations, FFC administered wartime import controls over enemy assets and restrictions on trade with enemy states. It also participated in administering theProclaimed List of Certain Blocked Nationals, or the "Black List", and tookcensuses of foreign-owned assets in the US and American-owned assets abroad. FFC was abolished in 1947, with its functions transferred to the newly establishedOffice of International Finance (OIF). In 1948, OIF activities relating to blocked foreign funds were transferred to the Office of Alien Property, an agency within theDepartment of Justice.^[9]

The Division of Foreign Assets Control, OFAC's immediate predecessor, was established in the Office of International Finance by a Treasury Department order in December 1950, following the entry of thePeople's Republic of China into theKorean War;^[8] PresidentHarry S. Truman declared anational emergency and tasked the Division with blocking all Chinese and North Korean assets subject to U.S. jurisdiction. The Division also administered regulations and orders issued under the amended Trading with the Enemy Act.^[6] On October 15, 1962, by a Treasury Department order, the Division of Foreign Assets Control became the Office of Foreign Assets Control.^[9]

In addition to theTrading with the Enemy Act and the variousnational emergencies currently in effect, OFAC derives its authority from a variety ofU.S. federal laws, particularly theInternational Emergency Economic Powers Act (IEEPA), regardingembargoes and economic sanctions.^[10]

In enforcing economic sanctions, OFAC acts to prevent "prohibited transactions", which are described by OFAC as "trade or financial transactions and other dealings in which U.S. persons may not engage unless authorized by OFAC or expressly exempted by statute". OFAC has the authority to grant exemptions to prohibitions on such transactions, either by issuing a general license for certain categories of transactions, or by specific licenses issued on a case-by-case basis.^[6]

Under theInternational Emergency Economic Powers Act (IEEPA), theU.S. President can block the removal of foreign assets under U.S. jurisdiction during national emergencies. OFAC executes this mandate by issuing regulations to financial institutions.^[11]

As part of its efforts to support theIraq sanctions, in 2005, OFAC finedVoices in the Wilderness $20,000 for gifting medicine and other humanitarian supplies to Iraqis.^[12] In a similar case, OFAC imposed and attempted to collect a $10,000 fine, plus interest, against peace activist Bert Sacks for taking medicine to residents ofBasra;^[13] charges against Sacks were dismissed by the court in December 2012.^[14]

In October 2007, a set of Spanish travel agency websites had their domain name access disabled byeNom: the domain names had been on the OFAC blacklist.^[15][16] When queried, the U.S. Treasury referred to a 2004 press release that claimed the company "had helped Americans evade restrictions on travel to Cuba".^[15]

In the case ofUnited States v. Banki, on June 5, 2010, a U.S. citizen was convicted of violatingsanctions against Iran by failing to request Iranian currency transfer licenses in advance from OFAC. On August 25, 2010, the Iranian American Bar Association announced that it would file anamicus curiae brief with theCourt of Appeals for the Second Circuit inUnited States v. Banki.^[17] It has also hired lawyers to request further guidance from OFAC on import of goods from Iran.^[18]

In 2014, OFAC reached a record $963 million settlement with the French bankBNP Paribas, which was a portion of an $8.9 billion penalty imposed in relation to the case as a whole.^[19][20]

Appointment as OFAC director is not subject toSenate confirmation.^[21]

OFAC publishes a list of Specially Designated Nationals (SDNs), which lists people, organizations, and vessels with whomU.S. citizens andpermanent residents are prohibited from doing business.^[6] This list differs from the list maintained pursuant to Section 314(a) of thePatriot Act.^[22]

In August 2009, a federal court ruling inKindHearts v. Treasury found that Treasury's seizure of KindHearts assets without notice or means of appeal was a violation of theFourth andFifth Amendments to the Constitution.^[23]

On September 23, 2011, theNinth Circuit Court of Appeals upheld a lower court's ruling that procedures used by the Treasury to shut down the Oregon-basedAl Haramain Islamic Foundation in 2004 were unconstitutional. The court said the Fifth Amendment's guarantee ofdue process required the Treasury to give adequate notice of the reasons it puts a group on the terrorist list, as well as a meaningful opportunity to respond. In addition, the court ruled that freezing the group's assets amounts to a seizure under the Fourth Amendment, so that a court order is required.^[24]

As of October 7, 2015, the SDN List had more than 15,200 entries from 155 countries. Of those, 178 entries were for aircraft and 575 entries were for ships ("vessels"). The remaining 14,467 entries were for designated individuals and organizations.^[25] OFAC creates separate entries in the SDN list for each alias of a designee, so the number of entries does not reflect the number of designees.^[3]

On September 21, 2021, a cryptocurrency exchange was included in the sanctions list for first time for helping launder illicit funds having source fromransomware attacks. The amounts laundered are more than $160 million, between 2018 and 2021.^[26]

OFAC publishes a list of Sectoral Sanctions Identifications (SSI), which lists persons, companies, and entities in sectors of the Russian economy (especially energy, finance, and armaments), prohibiting certain types of activity with these individuals or entities by US persons, wherever located.^[27] This list is maintained following the issuance of EO13662Blocking Property of Additional Persons Contributing to the Situation in Ukraine on March 20, 2014, in accordance with 79 FR 16167.^[28]

On August 13, 2014, the Treasury Department issued guidance for entities under sectoral sanctions. It increased the number of entities on the sectoral sanctions identifications list by adding subsidiaries of entities under sectoral sanctions that hold 50% or greater ownership by an entity under sectoral sanctions either individually or in the aggregate, either directly or indirectly. Further, US persons cannot use a third party intermediary and must exercise caution during "transactions with a non-blocked entity in which one or more blocked persons has a significant ownership interest that is less than 50% or which one or more blocked persons may control by means other than a majority ownership interest."^[29]

On December 22, 2015, the Treasury Department explicitly listed all entities and their subsidiaries on the sectoral sanctions identifications list using a human readable search.^[30][31][32]

This sectionneeds expansion with: citations and dates for authorizations in table. You can help byadding to it.(November 2015)

As of August 8, 2020, OFAC was administering the following sanctions programs:^[33]

Table note: The numbers of individuals, companies, vessels, and aircraft are taken from theSDN List. However, any single entry on that list may be a target of multiple sanctions programs, so summing lines of the table will inflate the true sum due to duplication.

In December 2024, Chinese state-sponsored hackers breached OFAC systems through cybersecurity vendor BeyondTrust, gaining access to unclassified administrative records containing potential sanctions deliberation information and future targets. This incident, described by Treasury officials as "major" and also affecting the Office of the Treasury Secretary andOffice of Financial Research, marked the second knownPRC intrusion into OFAC, following a breach in the early 2000s that compromised general counsel office emails.^[73][74] In response, on January 17, 2025, OFAC sanctioned Yin Kecheng, a Shanghai-based hacker affiliated with China'sMinistry of State Security allegedly responsible for the compromise.^[75][76]

• Title 31 of the Code of Federal Regulations
• United States sanctions

• Bryan R. Early & Keith A. Preble (2020) "Going Fishing versus Hunting Whales: Explaining Changes in How the US Enforces Economic Sanctions."Security Studies.

• Media related toOffice of Foreign Assets Control at Wikimedia Commons
• Official website

• Government agencies established in 1950
• International sanctions
• Export and import control
• United States Department of the Treasury agencies
• 1950 establishments in the United States
• Specially Designated Nationals and Blocked Persons List

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