One of the authorizations added to both the NTSR and the FNKSR permits certain transactions involving persons who are blocked pursuant to these regulations, and who are incarcerated in the United States or otherwise in U.S. custody. Notably, as covered here, a global payments company recently settled alleged sanctions violations for, among other things, failing to identify that inmates for whom it was processing transactions were named on OFAC's Specially Designated Nationals and Blocked Persons List. It is unclear whether the specific transactions involved in that case would have been permitted under the new authorization. Nonetheless, the recent settlement and the NTSR and FNKSR amendments demonstrate that OFAC is paying keen attention to dealings with sanctioned persons who are incarcerated in U.S. prisons. This serves as a useful reminder that sanctions risks can present themselves not only in connection with cross-border transactions, but also with respect to purely domestic U.S. dealings.

Commentary

One of the authorizations added to both the NTSR and the FNKSR permits certain transactions involving persons who are blocked pursuant to these regulations, and who are incarcerated in the United States or otherwise in U.S. custody. Notably, as covered here, a global payments company recently settled alleged sanctions violations for, among other things, failing to identify that inmates for whom it was processing transactions were named on OFAC's Specially Designated Nationals and Blocked Persons List. It is unclear whether the specific transactions involved in that case would have been permitted under the new authorization. Nonetheless, the recent settlement and the NTSR and FNKSR amendments demonstrate that OFAC is paying keen attention to dealings with sanctioned persons who are incarcerated in U.S. prisons. This serves as a useful reminder that sanctions risks can present themselves not only in connection with cross-border transactions, but also with respect to purely domestic U.S. dealings.