ECONOMIC STATECRAFT INITIATIVE
ISSUE BRIEF
The Missing Pieces: Resourcing and Improving OFAC Sanctions Enforcement MARCH 2024
The Atlantic Council is a nonpartisan organization that galvanizes US leadership and engagement in the world, in partnership with allies and partners, to share solutions to global challenges. The Atlantic Council provides an essential forum for navigating the economic and political changes defining the twenty-first century by informing its network of global leaders. Through the papers it publishes and the ideas it generates, the Atlantic Council shapes policy choices and strategies to create a more free, secure, and prosperous world. The Atlantic Council’s GeoEconomics Center works at the nexus of economics, finance, and foreign policy with the goal of helping shape a better global economic future. The Center is organized around three pillars — Future of Capitalism, Future of Money, and the Economic Statecraft Initiative.
By DAVID MORTLOCK and ALEX ZERDEN
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nforcement remains a critical but underresourced element of economic sanctions. The US Congress and the Department of the Treasury should consider updates to its resources, public guidance, and policies to ensure the efficacy of sanctions enforcement as the use of the sanctions policy tool continues to expand.
Economic sanctions are often described as the foreign policy tool of first resort. The Department of the Treasury acknowledged this reality in its “2021 Sanctions Review.” Through its Office of Foreign Assets Control (OFAC), the Treasury Department administers thirty-eight different, albeit overlapping, economic sanctions programs. With only a few hundred employees, OFAC has a nearly unparalleled national security mandate with oversight of the US economy and many other facets of global economic activities. OFAC develops policies for the use of sanctions, designates sanctions targets like individuals, entities, and jurisdictions, engages with the private sector to promote compliance, and civilly enforces apparent violations by US persons and others. This latter enforcement role represents a critical but often overlooked capability. For instance, the same “2021 Sanctions Review” does not even mention the enforcement function in its assessment. (However, it did seek to ensure that sanctions are “enforceable” in the context of sanctions implementation.) Resource constraints, a lack of attention, and the prioritization of policy crises hamper this enforcement function. In 2023, OFAC only undertook seventeen public enforcement actions, including its largest settlement to date with Binance, a global cryptocurrency exchange. For perspective, the Department of Justice terminated 63,419 civil cases in fiscal year 2022, according to the most recent public data. As the wider interagency continues to rely on sanctions as a critical tool and the United States seeks to expand partner sanctions capacity, US policymakers must fully support the sanctions enforcement function. Strengthening the internal controls for OFAC enforcement improves the rule of law through