Frequently Asked Questions

40. If my financial institution receives a wire going to an embassy in a sanctioned country, can we process the transaction?

This depends on the program. If you have a payment involving an embassy in a targeted country, please contact OFAC Compliance for directions (1-800-540-6322). … 40 … If my financial institution receives a wire going to an embassy in a sanctioned country, can we process the transaction? … 1621 …… Read more

43. Does a financial institution need to scan names against OFAC's list of targets upon account opening or can it wait for 24 hours to receive a report from its software vendor on whether or not there is a hit?

There is no legal or regulatory requirement to use software or to scan. There is a requirement, however, not to violate the law by doing business with a target or failing to block property. OFAC realizes that financial institutions use software that does not always provide an instantaneous response… Read more

417. Are payments or the facilitation of payments not involving U.S. persons to Iranian civil aviation authorities for overflights of Iran or landing in Iran by aircraft that are owned by a non-U.S. person and registered outside the United States sanctionable under U.S. law?

No. Provided that the relevant transactions do not involve the U.S. financial system or persons on the Specially Designated Nationals and Blocked Persons List ( SDN List ), payments of charges for services rendered by the Government of Iran in connection with the overflight of Iran or landing in… Read more

455. Is the provision of routine goods and services by non-U.S. persons to diplomatic missions of the Government of Iran located outside the United States sanctionable under U.S. law?

The provision of goods and services for the conduct of the official business of the diplomatic missions of the Government of Iran located outside the United States or for the personal use of the employees of the missions, including financial services such as the opening of a bank account, by a non-… Read more

37. My bank operates accounts for individuals living in Iran. OFAC has told us that these accounts cannot be operated. Does this mean that the accounts are blocked?

No, the accounts are restricted. The Iranian sanctions prohibit the export of goods or services to Iran. By operating an account for an individual or company in Iran, the bank would be exporting services to that person or entity in violation of the Iranian Transactions Regulations. The accounts,… Read more

38. Are U-Turn payments for Iran still permitted?

No, as of November 10, 2008 U-Turn payments are no longer allowed. … 38 … Are U-Turn payments for Iran still permitted? … 1551 … No, as of November 10, 2008 U-Turn payments are no longer allowed. … Are U-Turn payments for Iran still …

371. What does OFAC interpret to be debt and equity? Are there other prohibited activities under Directives 1, 2, and 3 under Executive Order (E.O.) 13662? Can U.S. financial institutions continue to maintain correspondent accounts and process U.S. dollar-clearing transactions for the entities subject to the prohibitions of these directives?

The term debt includes bonds, loans, extensions of credit, loan guarantees, letters of credit, drafts, bankers acceptances, discount notes or bills, or commercial paper. The term equity includes stocks, share issuances, depositary receipts, or any other evidence of title or ownership. The… Read more

372. Do Directives 1, 2, and 3 prohibit U.S. persons from entering into derivatives contracts linked to new debt or new equity issued by the entities subject to the Directives?

On November 28, 2017, OFAC issued General License 1B , which continues to authorize certain transactions involving derivative products that would otherwise be prohibited pursuant to Directives 1, 2, or 3. General License 1B replaced and superseded General License No. 1A, dated September 12, 2014… Read more

373. Do the prohibitions imposed pursuant to the Directives also extend to entities owned 50 percent or more by one or more entities identified by these Directives, as per revised guidance OFAC issued on August 13, 2014?

Yes, these prohibitions apply to the named persons, their property, and their interests in property, which includes entities owned 50 percent or more by one or more persons identified as subject to the Directives. On October 31, 2017, OFAC amended and reissued Directive 4 in accordance with Section… Read more

550. When OFAC references a prohibition involving an “SSI entity” in these FAQs or in other guidance, what does that term mean?

When OFAC uses the term "SSI entity" in these FAQs or in other guidance, it is referring to an entity subject to the Directive(s) at issue in a particular FAQ or piece of guidance. … 550 … When OFAC references a prohibition involving an “SSI entity” in these FAQs or in other guidance, what does… Read more

Frequently Asked Questions

Office of Terrorism and Financial Intelligence