OFAC releases guidance on extension of the statute of limitations for sanctions violations

On 22 July, the Office of Foreign Assets Control (OFAC) issued guidance on extension of the statute of limitations from 5 to 10 years for violation of certain sanctions.  

Up until April 2024, civil enforcement actions for sanctions violations brought by OFAC were subject to a five-year statute of limitations, which corresponded to the five-year required recordkeeping period. On 24 April 2024, the US President Joe Biden signed into law H.R. 815, the National Security Supplemental. The new law extended, from five years to ten years, the statute of limitations for civil and criminal violations of the International Emergency Economic Powers Act (IEEPA) or the Trading with the Enemy Act (TWEA).

What it means for companies?

OFAC may now commence an enforcement action for violations of TWEA and IEEPA-based sanctions prohibitions within 10 years of the latest date of violation if it happened after 24 April 2019.

What companies should do to prevent sanctions violations?

It is recommended that companies update their retention policies and procedures to reflect the change to ten years. It is also advisable for companies to have a longer “look back” period to evaluate their transactions and conduct. The due diligence efforts should be increased and compliance procedures may be modified if necessary. It is also advisable to have rigorous compliance training, covering sanctions matters.

How Gherson can help

Gherson lawyers can help you to navigate the complexity of sanctions legislation and ensure your full compliance with it. We can assist in developing your company compliance policies, including sanction policies and deliver training to your employees, both in the UK or overseas.

The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please do not hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.

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