There is sometimes confusion about the List of Specially Designated Nationals and Blocked Persons (“SDN List”) maintained by the United States Department of the Treasury Office of Foreign Assets Control (OFAC) and the 314(a) List promulgated under the Patriot Act. In this post I will highlight some of the main differences.
1. Availability. The 314(a) List is highly sensitive and confidential. As such, it is disseminated only to a small select group and subject to the utmost confidentiality. On the other hand, the OFAC SDN List is a public list of names which is available on the Internet.
2. Content. The 314(a) List consists of entities and individuals identified by federal or other law enforcement authorities as parties under investigation. This list is provided to banking regulators for confidential dissemination to banks. The OFAC SDN List consists of individuals and entities that are subject to sanctions programs administered by the Office of Foreign Assets Control. There may or may not be pending law enforcement investigations against these parties.
3. Notification. An institution is prohibited from notifying any individual or entity on the 314(a) List that it is on the list. Unlike the 314(a) List designation, it is permissible to reveal that a party is on the OFAC list. In addition, institutions may tell customers that the reason assets were blocked or a transaction was rejected was due to a hit on the OFAC SDN List.
4. Bank Reporting Requirements. If activity relating to the person or entity on the 314(a) list is suspicious, banks must file a Suspicious Activity Report (“SAR”) if applicable dollar amount triggers are involved. For the OFAC SDN List, it is not always required, unless there is suspicious activity involving the entity/individual and the bank.
I have gotten a number of emails from people all over the world inquiring into OFAC’s “Secret List”. I believe what these individuals are referring to is the 314(a) List. As always, if you are unsure of what to do with a particular type of hit, contact either OFAC or the Financial Crimes Enforcement Network (“FinCEN”) to make an appropriate determination.
The author of this blog is Erich Ferrari, an attorney specializing in OFAC matters. If you have any questions please contact him at 202-280-6370 or firstname.lastname@example.org.