OFAC / Sanctions Reaction to Hostage Taking in Russia & Iran

Focus on extralegal detentions


Treasury's Office of Foreign Assets Control (OFAC) has imposed sanctions on four senior officials of Iran's Islamic Revolutionary Guard Corps Intelligence Organization (IRGC-IO) in a groundbreaking move.

This marks the first time Executive Order (E.O.) 14078 has been employed to penalize individuals involved in the hostage-taking or wrongful detention of U.S. nationals in Iran. The IRGC-IO has been designated by the State Department for its role in suppressing protests, arresting dissidents, and detaining and interrogating prisoners in Evin Prison.

In addition to the action against Iran, OFAC has implemented the State Department's designation of Russia's Federal Security Service (FSB) for its involvement in the wrongful detention of U.S. nationals abroad.

Brian E. Nelson, Under Secretary of the Treasury for Terrorism and Financial Intelligence, emphasized the U.S. government's commitment to bringing home wrongfully detained U.S. nationals and acting against foreign threats to their safety.

E.O. 14078 draws its authority from the 2020 Robert Levinson Hostage Recovery and Hostage Taking Accountability Act, recognizing the Levinson family's and others' efforts in turning their hardships into meaningful action.

OFAC has also issued Cyber-related General License 1C, "Authorizing Certain Transactions with the Federal Security Service," and amended three Cyber-related Frequently Asked Questions (501, 502, 503). General License No. 1C authorizes specific transactions with the FSB, previously prohibited by the Cyber-Related Sanctions Regulations (CRSR), Weapons of Mass Destruction Proliferators Sanctions Regulations (WMDPSR), and E.O. 14078. The license aims to ensure that U.S. persons engaged in certain business activities in Russia, not otherwise prohibited, are not unduly impacted.

These authorized transactions must be incidental and necessary for handling licenses, permits, certifications, or notifications related to information technology products in Russia, subject to certain conditions and a $5,000 annual fee limit; complying with law enforcement or administrative actions or investigations involving the FSB; and adhering to rules and regulations administered by the FSB. However, the general license does not authorize the transfer of blocked property or account or transactions otherwise prohibited by CRSR, WMDPSR, or E.O. 14078.

Effective April 27, 2023, General License No. 1C replaces and supersedes General License No. 1B, dated February 17, 2021. Russia-related General License No. 42 provides additional authorization for specific transactions with the FSB prohibited by E.O. 14024. It is crucial to note that exportation, reexportation, or provision of goods, services, or technology to designated regions of Ukraine, including Crimea, remains prohibited under the Ukraine-/Russia-Related Sanctions Regulations, 31 CFR part 589, among others.



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