On 7 October 2015, OFAC designated three Honduran businessmen — Jaime Rolando Rosenthal Oliva, his son Yani Benjamin Rosenthal Hidalgo, and his nephew Yankel Antonio Rosenthal Coello — under the Foreign Narcotics Kingpin Designation Act. According to OFAC’s press release, the Rosenthals provided money laundering and other services to support the illicit activities of various Central American drug traffickers and criminal organisations. The men were charged in an indictment in the Southern District of New York on 6 October 2015 for money laundering in violation of US laws.
The Rosenthal family’s banking arm, Banco Continental S.A., based in Honduras, became the first bank ever designated under the Kingpin Act. OFAC also designated nine other entities controlled by the Rosenthals, with holdings in the insurance, real estate, agriculture, construction, tourism, and media businesses. Three of the designated businesses are located in the United States itself; the others are located in Honduras, Panama or the British Virgin Islands.
After OFAC blocked Banco Continental’s property, the Honduran government informed OFAC that it had placed the bank into liquidation. In response, OFAC issued a statement on 11 October 2015 clarifying that it would not impose sanctions on any non-US entities that participate in the bank’s liquidation so long as they do not seek to benefit any of the other designated individuals or entities. OFAC published a similar statement on 22 October 2015 regarding Honduran liquidation proceedings against Seguros Continental S.A., an insurance company controlled by the Rosenthal family.
On 21 October, OFAC published General License No. 1 under the Foreign Narcotics Kingpin Sanctions Regulations authorising US persons to engage in transactions until 12 December 2015 in connection with Banco Continental’s liquidation, including bidding to acquire the bank’s assets. The general licence does not authorise transactions with the other designated individuals or entities or the release of blocked property, and it is subject to the requirement that the transactions be reported to OFAC within 10 days after the liquidation and wind-down activities conclude.