OFAC Resolve Clash With First Amendment

Akamai Traffic to Syria
Akamai Traffic to Syria

In may of 2014, Office of Foreign Assets Control (OFAC) imposed sanctions on trade with Syria, including books and other works by Syrian authors. The sanction on Syrian authors include Syrian nationals in the United States. Pen American Center and other publishers and author groups opposed this move as an infringement on the First Amendment. Last week, OFAC amended the sanction to excluding trade involving publishing. This was a similar move made a decade ago when OFAC amended sanctions on Cuban, Iranian and Sudanese transactions “necessary and ordinarily incidental” to publishing and marketing written works from those regions.

Rosie Malek-Yonan, Assyrian Authoer
Rosie Malek-Yonan, Assyrian Authoer

While OFAC’s amendment makes obvious sense, so does its pre-amended sanction. Trade involves money and the transactions of money in exchange for expression could lead to funding terrorism because “expression” could mean a whole lot of things. Even if trade didn’t involve money or things of monetary value, publishing could be a method of providing communication for terrorists. Of course, providing communication paths is not unique to publishing. Messages could be attached to invoices as well. And then there are the great number of communications devices and software available for free.


About the Author: Marcus Maltempo is a compliance professional with more than a decade of experience helping banks, law firms and clients manage investigations and regulatory responses. He is the author of the forthcoming book History of Money Laundering: How criminals got paid and got away.


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FATF Means Financial Action Task Force

The Financial Action Task Force (FATF) is an inter-governmental body established in 1989 by the Ministers of its Member jurisdictions. The objectives of the FATF are to set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system. The FATF is therefore a “policy-making body” which works to generate the necessary political will to bring about national legislative and regulatory reforms in these areas. – FATF

FATF is housed at the Organization Economic Co-operation and Development (OECD) in Paris, France. It works with the G-7 world leaders, G-20 finance ministers to make policy and enforcement recommendations regarding anti-money laundering, anti-bribery, anti-corruption, anti-terrorist financing and anti-piracy. It is part thinktank and part NGO.

FATF has a membership status for each country. There are thirty five member nations and the rest are either observing the guidelines and recommendations or not actively doing so. FATF also has a Blacklist, a list of banned nations. The usual suspects are listed: Iran, North Korea, etc.

The Treasury represents the United States at the FATF. The Financial Crimes Enforcement Network (FinCEN) is the primary contact for guidance.


About the Author: Marcus Maltempo is a compliance professional with more than a decade of experience helping banks, law firms and clients manage investigations and regulatory responses.


Financial Crime Briefing: Strengthening Controls to Address Evolving Risk Trends

On Monday, January 26, Associations of Certified Anti-Money Laundering Specialists (hereon ACAMS) held its Third Annual AML Risk Management Conference at The Conrad Hotel in downtown New York. Over the course of this week, summaries and takeaways from the key notes and panel discussions will be shared in this blog.

  • William Langford, Moderator, Global Head of Compliance Architecture and Strategy, Citigroup
  • Martin Cunningham, CAMS, Regional Head – Financial Crime Intelligence – Americas, Standard Chartered Bank
  • Justin Bogert, CAMS, Global Controls Manager, Paypal

HeaderThis panel discussion, the final for the conference, was a well-rounded compliance function discussion. Compliance department has a lot of roles: adviser, monitor, surveillance, investigation, risk mitigation, oversight and control, and regulatory relations. The focus of this panel was monitoring, surveillance and investigation. Both Martin Cunningham and Justin Bogert have military intelligence backgrounds. Cunningham is at a traditional financial institution and Bogert is at a money services business (MSB). Many of the issues are the same but the institutions differing in two main ways, in terms of compliance:

  1. MSB’s collect far less information during onboarding a client, and
  2. MSB’s have more issues pertaining to charities being abused for money laundering or terror financing.

Paypal silos risk into three buckets: Brand Risk, Fraud Risk and Transaction Risk. Traditional anti-money laundering program development are utilized to research typology. Special effort is made to collect information as transactions, both financial and non-financial, take place on Paypal’s platform to create risk profiles. Paypal has developed an internal visualization tool to find relationships.

Standard Chartered Bank is highly exposed to developing economies. For this reason, geo-political expertise is highly valued. SCB’s AML teams are made up of four groups of people: Law Enforcement, Intelligence, Bankers and Trade/Tool personnel. Law Enforcement are good at documentation and analysis of the collected information. Intelligence are good at bringing outside information in to provide context. Bankers bring institutional knowledge about how the organization reacts to transactions and relationships. Trade and Tools personnel provide execution expertise in both preventing and investigating crimes.


About the Author: Marcus Maltempo is a compliance professional with more than a decade of experience helping banks, law firms and clients manage investigations and regulatory responses.
He tweets @MoneyCompliance