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OFAC Enforcement Actions on the Rise: Effective Ways to Strengthen Your Compliance Programs

Risk and Compliance CLE

OFAC Enforcement Actions on the Rise: Effective Ways to Strengthen Your Compliance Programs

Live Webcast Date: Tuesday, February 09, 2016 at 12:00 pm - 2:00 pm (ET)
Risk and ComplianceRecording

Sanctions offenses against the Office of Foreign Assets Control (OFAC) carry civil and criminal liabilities, with a single business trade or deal potentially resulting in multiple violations and hefty fines. In just a few years, civil penalties and settlements have grown from several millions of dollars to billions of dollars. Despite OFAC’s increasing enforcement actions, many businesses remain in the dark, putting OFAC compliance to the top of the agendas of boards and senior executives.

OFAC regulations have flourished mostly after the 9/11 attacks and have since been evolving with the stricter emphasis on national security. The U.S. has been implementing sectoral sanctions focused on certain entities across several international industries, such as in Russia and Iran. A company merging with or entering into new international markets also changes its risk profile. It has then become crucial for policies and procedures to be improved to protect the company against OFAC violations and sanctions.

Companies should also ensure that their compliance programs are in accordance with OFAC’s Specially Designated Nationals (SDN) list and country program and are incorporated into the development of new products and services as well as international trade agreements. In the recent case involving BNP Paribas and Commerzbank, the government exacted substantial penalties from the banks for doing business with blacklisted countries in violation of the U.S. sanctions laws. Through information technology, companies are now checking this list for banned vendors, customers, and employees. Recent enforcement actions show that the government is looking beyond international banks to sanction penalties for global companies operating in other industry sectors.

In this two-hour Webcast, a panel of key thought leaders and OFAC compliance specialists will share their insights on high-profile cases involving OFAC, provide guidance on recent enforcement actions, and share their thoughts and experiences on how to effectively Strengthen Your Compliance Programs.

Key topics include:

  • Trends and Developments in OFAC Sanctions Enforcement in 2016
  • Risk Assessment and Compliance Procedures on Anti-Corruption and Sanctions Laws
  • Best Practices for Complying with OFAC Sanction Laws
  • Key Compliance Issues and Risks in International Markets
  • Compliance Issues on SDN Lists
  • Future Developments and How to Prepare for Them

Who Should Attend

  • OFAC Specialists
  • Risk and Compliance Professionals
  • Investment Advisers
  • Bank Regulation Lawyers and Executives
  • Attorneys (Foreign Investment; National Security, International Trade Practice)
  • International Contract Managers
  • Trade Association Representatives
  • Trade Compliance Administrators and Managers
  • International Trade Counsel and Specialist
  • Corporate Senior Management
  • Executive Directors and Officers
  • Corporate Counsel and Lawyers
  • Business Lawyers
  • Business Managers
  • Private Companies


Kevin Petrasic

Kevin Petrasic
Partner, Corporate Department
White & Case LLP

Richard J. Zack

Richard J. Zack
Pepper Hamilton LLP

Anthony Rapa

Anthony Rapa
Of Counsel
Steptoe & Johnson LLP

Click Here to Read Additional Material

Kevin Petrasic, Partner, Corporate Department
White & Case LLP

Richard J. Zack, Partner
Pepper Hamilton LLP


Anthony Rapa, Of Counsel
Steptoe & Johnson LLP
  • Trends and Developments in OFAC Sanctions Enforcement in 2016 (Kevin)
    • Regulators Will Continue to Seek Heightened Personal Accountability For OFAC Sanctions Violations
    • NYDFS Proposed Regulation on Chief Compliance Officer Certification
    • Settlement Agreements Requiring Termination of Key Employees
    • NYDFS expressed intention to “increasingly to move toward individual accountability in the resolution of [sanctions violations] settlements.” 
    • Conduct Subject to Enforcement
    • A primary concern for banking institutions in the U.S. is their role as intermediaries in international payment transactions
    • Many sanctions programs effectively prohibit banks from processing, or “clearing,” USD transactions on behalf of sanctioned entities or SDNs
    • Several 2014 and 2015 actions involved use of “wire stripping,” or use of “cover payment,” which involves sending two SWIFT messages in connection with a single payment, to conceal the involvement of sanctioned entities and SDNs in USD transactions and avoid controls related to sanctions
    • Banks cannot omit, delete, or alter information messages or orders for the purpose of avoiding detection of information by any other financial institution in the payment process, even where underlying transaction is legal
  • Risk Assessment and Compliance Procedures on Anti-Corruption and Sanctions Laws (Anthony)
    • OFAC Compliance Program
    • OFAC Risk Assessment
    • An effective risk assessment should be a composite of multiple factors (set forth below), and depending upon the circumstances, certain factors may be weighed more heavily than others
    • Although not an exhaustive list, examples of products, services, customers, and geographic locations that may carry a higher level of OFAC risk include:
    • Required Actions: Blocking and Rejecting Transactions
    • Blocking Transactions
    • Rejecting Transactions
  • Best Practices for Complying with OFAC Sanction Laws (Richard)
    • Internal Controls
    • Identifying and reviewing suspect transactions
    • The bank’s policies, procedures, and processes should address how the bank will identify and review transactions and accounts for possible OFAC violations, whether conducted manually, through interdiction software, or a combination of both
    • For screening purposes, the bank should clearly define its criteria for comparing names provided on the OFAC list with the names in the bank’s files or on transactions and for identifying transactions or accounts involving sanctioned countries
    • The bank’s policies, procedures, and processes should also address how it will determine whether an initial OFAC hit is a valid match or a false hit – a high volume of false hits may indicate a need to review the bank’s interdiction program
    • Governance
    • Updating OFAC lists
    • Screening International Automated Clearing House (ACH) Transactions
    • Due diligence for an IAT may include screening the parties to a transaction, as well as reviewing the details of the payment field information for an indication of a sanctions violation, investigating the resulting hits, if any, and ultimately blocking or rejecting the transaction, as appropriate
    • Banks should encourage, or require, use of transparent payment messages by foreign branches and correspondent accounts
    • Reporting
    • An OFAC compliance program should also include policies, procedures, and processes for handling validly blocked or rejected items under the various sanctions programs
    • Maintaining License Information
    • This will allow the bank to verify whether a customer is initiating a legal transaction
    • Independent Testing/ Audit
    • The audit scope should be comprehensive enough to assess OFAC compliance risks and evaluate the adequacy of the OFAC compliance program
    • The person(s) responsible for testing should conduct an objective, comprehensive evaluation of OFAC policies, procedures, and processes.
    • Responsible Individual
    • Chief Compliance Officer
    • Training
  • Key Compliance Issues and Risks in International Markets (Anthony)
    • International USD Transactions
    • A primary concern for banking institutions in the U.S. is their role as intermediaries in international payment transactions
    • Lending Transactions
    • When engaging in lending activities, banks must ensure that they are not engaging in the “exportation of services” to a sanctioned country or SDN
    • In addition, letters of credit providing for settlement is USD may not be extended to entities subject to sanctions, or involving a transaction otherwise prohibited because of sanctions
  • Compliance Issues on SDN Lists (Kevin)
    • SDNs by Operation of Law
    • Screening
    • Filtering Programs
  • Future Developments and How to Prepare for Them (Richard)
    • US Sanctions Relief in Iran
    • New OFAC Regulation on Cyber-Related Sanctions

Kevin Petrasic

Kevin PetrasicPartner, Corporate DepartmentWhite & Case LLP

Kevin Petrasic is a partner in the Banking practice of White & Case LLP and head of the Firm’s Global Bank Advisory group. He advises banks and financial firms on regulatory, transactional, compliance, supervisory, enforcement, legislative, and policy issues. His clients include domestic and foreign banks, investment banks, private equity and hedge funds, investment managers and advisers, securities firms, insurance companies, payments companies, and FinTech firms.

Kevin has extensive experience in Dodd-Frank compliance, bank holding company regulation, credit card and consumer financial compliance laws, UDAAP issues, data privacy and data breach issues, compliance laws impacting payments systems, mergers and acquisitions, anti-money laundering issues and OFAC compliance, bank powers and activities, legislative matters, mortgage market regulation, and corporate governance.

He has over 20 years of government experience, including serving as Special Counsel, Managing Director of External Affairs, Director of Congressional Affairs, Legislative Counsel, and Assistant Chief Counsel at the US Treasury Department's Office of Thrift Supervision, as well as Counsel to the former US House Banking Committee.

Richard J. Zack

Richard J. ZackPartnerPepper Hamilton LLP

Richard J. Zack is a partner in the White Collar and Corporate Investigations and Commercial Litigation Practice Groups of Pepper Hamilton LLP, resident in the Philadelphia office.

Prior to joining Pepper, Mr. Zack was chief of commercial and consumer fraud and deputy chief of economic crimes for the U.S. Attorney’s Office for the Eastern District of Pennsylvania. There he supervised all consumer and commercial fraud cases, including mortgage investment, securities and corporate fraud. Before that, Mr. Zack was deputy chief of the criminal division and an Assistant U.S. Attorney.

Mr. Zack represents businesses, educational institutions, nonprofits and individuals facing investigation by federal and state law enforcement authorities, and government regulatory agencies. Mr. Zack also represents businesses and individuals who have been victims of crimes.

Anthony Rapa

Anthony RapaOf CounselSteptoe & Johnson LLP

Anthony Rapa (Washington) is of counsel in Steptoe’s Washington office, where he is a member of the International Regulation & Compliance Group. His practice focuses on economic sanctions and export controls, including matters arising under US, EU, and UK regulatory regimes.  He has extensive experience with counseling clients on complex cross-border transactions, conducting global internal investigations, development of corporate sanctions compliance policies, conducting regulatory due diligence in support of international mergers and acquisitions, and submission of voluntary disclosures and license applications to US regulators.  Mr. Rapa previously practiced in Steptoe’s London office, and is qualified as a solicitor in England and Wales.  He is a frequent contributor to the Steptoe International Compliance Blog.

Course Level:

Advance Preparation:
   Print and review course materials

Method Of Presentation:
   On-demand Webcast


Course Code:

NASBA Field of Study:
   Specialized Knowledge and Applications

NY Category of CLE Credit:

Total Credits:
   2.0 CLE

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About the Knowledge Group

The Knowledge Group

The Knowledge Group has been a leading global provider of Continuing Education (CLE, CPE) for over 13 Years. We produce over 450 LIVE webcasts annually and have a catalog of over 4,000 on-demand courses.

About the Knowledge Group

The Knowledge Group

The Knowledge Group has been a leading global provider of Continuing Education (CLE, CPE) for over 13 Years. We produce over 450 LIVE webcasts annually and have a catalog of over 4,000 on-demand courses.

White & Case is an international law firm that serves companies, governments and financial institutions. The Firm, which has more than 1800 lawyers working in 39 offices in 26 countries around the world, has a long history as a global firm, allowing it to be uniquely positioned placed to help clients resolve their most complex legal challenges wherever they are.  As a pioneering international law firm, the Firm’s cross-border experience and diverse team of local, US and English-qualified lawyers consistently deliver results for its clients. In both established and emerging markets, White & Case lawyers are integral, long-standing members of the community, and provide important insights into the local business environment combined with extensive experience in multiple jurisdictions.  The Firm advises a wide range of clients and works with some of the world's most respected and well-established banks and businesses, as well as start-up visionaries, governments and state-owned entities.

Website: http://www.whitecase.com/

Pepper Hamilton LLP is a multi-practice law firm with more than 500 lawyers nationally. The form provides corporate, litigation and regulatory legal services to leading business, governmental entities, nonprofit organizations and individuals throughout the nation and the world. The firm has grown from a two-person law offices formed in 1890 in Philadelphia to a sophisticated, large law firm with a national and international practice.

Pepper Hamilton LLP’s White Collar Litigation & Investigations team includes a highly skilled group of former judges, federal and state prosecutors, and experienced corporate counsel.

This team brings unparalleled expertise and judgment to legal representation in these areas:

  • White Collar Defense and Regulatory Enforcement
  • Corporate Investigations
  • Business Integrity, Compliance and Ethics
  • Monitorships

Our services are complemented by our alliance with Freeh Group International Solutions, LLC (FGIS), a global risk management firm. FGIS serves a diverse range of organizations in many industries, working to reduce risk in today’s increasingly dangerous and complicated global marketplace.

Website: http://www.pepperlaw.com/

Steptoe & Johnson LLP is an international law firm widely recognized for vigorous advocacy in complex litigation and arbitration, successful representation of clients before governmental agencies, and creative and practical advice in guiding business transactions. The firm has more than 500 lawyers and other professionals in offices in Beijing, Brussels, Century City, Chicago, London, Los Angeles, New York, Palo Alto, Phoenix and Washington. 

Website: http://www.steptoe.com/

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