How to Seek Removal from the Specially Designated Nationals and Blocked Persons List (SDN List)
A person placed on the SDN List is subjected to sanctions and embargo measures by the United States government. A person can petition for removal from the list.
Petitioning for Removal from the SDN List
The Specially Designated Nationals and Blocked Persons List (SDN List) lists people the United States government deems terrorists, officials and beneficiaries of authoritarian regimes, and international criminals (e.g., drug traffickers). The agency responsible for the list is the Department of the Treasury’s Office of Foreign Assets Control (OFAC). A person blocked from financial transactions in the United States may petition for removal from the SDN List.
The people listed on the SDN List are subject to sanctions and embargo measures. Although deletion from the listing is challenging, it is possible to petition for removal from the SDN List. SDN stands for Specially Designated National. In this context, a “national” is a person that is a citizen of a country other than the United States. U.S. Citizens can also qualify as blocked persons.
The SDN List contains tens of thousands of individuals who the government has identified as “posing a threat” to national security. Placement on the list does not require a conviction; as a result, many individuals listed on the SDN List might have been falsely implicated in criminal activity.
How Can Inclusion on the List Effect Someone?
All persons and businesses within the United States are banned from doing business with blacklisted individuals. Violating the prohibition subjects the U.S. business or individual to severe sanctions. Individuals and businesses within the United States are prohibited from investing in blacklisted companies or companies owned by blacklisted individuals.
Listed individuals will not be able to procure loans or secure credit from U.S. banks and financial institutions. For example, a person who the U.S. government designates as a drug trafficker will not be able to get a mortgage to purchase a home from a United States bank.
How is the SDN List Enforced?
OFAC provides financial institutions, other businesses, and people with the tools and resources needed to comply with the prohibitions by screening for names on the SDN List. Indeed, the effectiveness of automated screening as an enforcement tool contributes significantly to the effectiveness of list-based sanctions. Given the severe penalties imposed on international banks and businesses, practically every big or midsized international financial institution has made compliance with OFAC laws a top priority. A successful petition for removal from the SDN List will remove the prohibition against financial transactions involving that individual.
How to Petition for Removal from the Specially Designated Nationals and Blocked Persons List
The OFAC can remove a person or company from the SDN List by application and following a hearing. An experienced SDN List removal attorney familiar with the process will file a Request for Reconsideration (or Petition for Review) with OFAC to seek removal of a client’s name from the SDN List. The process of delisting is governed by 31 CFR Part 501.807.
There are two reasons why someone can be removed from the list. The first is if they were mistakenly added to the list. In that case, the person must file an application with OFAC demonstrating that they are not the intended target or that their designation was made in error.
A change in circumstances is the second way a name can be deleted. To argue “change in circumstances,” the person must usually admit that the original reason for designation was correct and that they may have been involved in some acts that were harmful to the United States in the past, but that circumstances have changed since then. For example, if a corporation on the SDN List was ever owned or controlled by a recognized drug trafficker or other SDN and that person is now incarcerated, or if the corporation has changed hands, there may be grounds for removal from the SDN List.
The Process for Delisting
The process for delisting is complex and can take a considerable period of time. An attorney must become extremely familiar with their client’s financial situation to argue most effectively that they should not be on the list. The discovery procedure, which can give the OFAC sanctions lawyer evidence held by the government, is one aspect of this process. Another aspect of the procedure is the opportunity to participate in an OFAC hearing or interview (the request for a hearing or interview must be included in the Request for Reconsideration).
In the end, your OFAC sanctions lawyer will argue that either (1) the designation was made in error, such as mistaken identity or false accusation of criminality, or (2) the circumstances have altered sufficiently to merit removal from the SDN List.
You can request an oral or written hearing. The Financial Stability Oversight Council has the discretion to grant a hearing upon written request. An oral hearing can be virtual or scheduled for an in-person hearing in your home state or Washington DC. If your petition for an oral hearing is denied, OFAC must grant you a written hearing.
After OFAC reviews the request for reconsideration and any evidence submitted, it will issue a written decision to the person or entity seeing unblocking.
How can a blocked person lawfully pay a lawyer to help them?
Because it is illegal to do business with a person or entity on the SDN List, an attorney is required to apply for a specific license authorizing the receipt of legal fees through OFAC Licensing. An SDN List Removal attorney must comply with the licensing requirement to accept funds directly or indirectly from the individual seeking removal from the SDN List.
Attorney for Seeking Removal from the SDN List
The attorneys with LEWIS & DICKSTEIN, P.L.L.C. have decades of experience successfully petitioning the government to prevent criminal charges, restore license sanctions, and avoid professional penalties. If OFAC has listed you as a Specially Designated National or a Blocked Person, we can help you. The process will require an investment of time and financial resources, but it is possible to petition for removal from the SDN List successfully. Call us for a free consultation, and we will work with you to develop a winning strategy for delisting from the Specially Designated Nationals and Blocked Persons List.
Call us today at (248) 263-6800 for a free consultation or complete a Request for Assistance Form. We will contact you promptly and find a way to help you.