Frequently Asked Questions

263. Who can receive payments from funds credited to a RECIPIENT ACCOUNT or SPECIAL PURPOSE ACCOUNT?

263 … In order for the National Defense Authorization Act's ( NDAA ) significant reduction exception to apply on or after February 6, 2013, the person receiving payment (e.g., the manufacturer or service provider) for goods or services being exported to Iran must be – (i) a citizen, national, or… Read more

264. Can funds be remitted to Iran or the Government of Iran (GOI) without exposure to sanctions?

264 … No. If funds from the RECIPIENT ACCOUNT or the SPECIAL PURPOSE ACCOUNT are remitted, directly or indirectly, to Iran, or paid to any person that is the GOI , the FFI would be exposed to sanctions. … Can funds be remitted to Iran or the Government of Iran (GOI) without exposure to …

265. Can the funds be used for sales made under the Humanitarian Exception?

265 … The National Defense Authorization Act of Fiscal Year 2012 (NDAA) generally exempts from sanctions sales made under the Humanitarian Exception (i.e., the sale of agricultural commodities, food, medicine, or medical devices from third countries to Iran). Funds deposited in the RECIPIENT… Read more

314. Can an exporter of agricultural commodities, food, medicine, or medical devices get paid out of a Central Bank of Iran (CBI) account at a foreign financial institution (FFI) in a country with a significant reduction exception, even though the exporter is located in a third-country? Can the third-country exporter’s bank handle this transaction?

314 … Yes. So long as the transaction does not involve a designated individual or entity, banks on the Part 561 List located on OFAC’s website, or otherwise proscribed conduct, such transactions are not sanctionable under U.S. law. Furthermore, there is no requirement under U.S. law that… Read more

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

40 … This depends on the program. If you have a payment involving an embassy in a targeted country, please contact OFAC Compliance's hotline for directions. … If my financial institution receives a wire going to an embassy in a sanctioned country, can we process the …

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?

43 … 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… Read more

44. Is there a dollar limit on which transactions are subject to OFAC regulations?

44 … There is no minimum or maximum amount subject to the regulations. … Is there a dollar limit on which transactions are subject to OFAC regulations? …

45. Does my bank need to check the OFAC list when selling cashier's checks and money orders? In the case of cashier's checks, do I need to check both the purchaser and the payee? As a mortgage lender, do I need to check both the purchaser and the seller's name against the Specially Designated Nationals list? Do I need to check their names against all of OFAC's other sanctions lists?

45 … Every transaction that a U.S. financial institution engages in is subject to OFAC regulations. If a bank knows or has reason to know that a target is party to a transaction, the bank's processing of the transaction would be unlawful. … Does my bank need to check the OFAC list when selling… Read more

46. If a loan meets underwriting standards but is a true "hit" on OFAC's Specially Designated Nationals (SDN) list, what do we use as a denial reason on the adverse action notice?

46 … If you have confirmed with OFAC that you have a "good hit" on the SDN list or one of OFAC's other sanctions lists , there is no reason not to explain that to the customer. The customer can contact OFAC directly for further information. … If a loan meets underwriting standards but is a true "… Read more

47. Through corporate giving programs, many banks contribute toward charities and other non-profits. To what extent does a bank need to review the recipients of these gifts or the principals of the charities?

47 … Donations to charitable institutions must be handled as any other financial transaction. The donating bank or institution should crosscheck the recipient names against OFAC's sanctions lists and assure that the donations are in compliance with OFAC sanctions programs . … Through corporate… Read more

Frequently Asked Questions

Office of Terrorism and Financial Intelligence