OFAC states that all U.S. organizations and individual persons must comply with OFAC regulations or face penalties. The focus has broadened in the past two years to include industries in addition to financial services including manufacturing, shipping, telecommunications and more.
As a result, everyone must avoid conducting business with anyone or any entity on the sanctions lists which are expansive, continually updated and cover individuals, businesses, states and vessels.
The penalties for infringement are onerous. In 2020, the highest OFAC fine in 2020 to date is $7,829,640*. When the costs of remediation, legal counsel and reputational damages are added, the total cost is significantly higher. Subsequent violations result in even tougher penalties.
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*Source: U.S. Treasury