US State Dept. Compliance FAQ

Q.  What watch lists does the State Department maintain?

A.  The US State Department maintains multiple lists of sanctioned or restricted parties, including:
  • Foreign Terrorist Organizations (FTO)
  • List of Statutorily Debarred Parties
  • List of Administratively Debarred Parties
  • Entity List for Sanctions for the Transfer of Lethal Military Equipment
  • Entity List for Missile Sanctions Laws
  • among others...

Q.  Which businesses need to pay attention to these lists?

A.  All U.S. persons should review these regulations, as different State Department lists have different impacts.  For the list of FTOs, the following applies (from the State Dept. web site): "It is unlawful for a person in the United States or subject to the jurisdiction of the United States to knowingly provide 'material support or resources' to a designated FTO".

Other State Department lists (published by the Bureau of International Security and Nonproliferation) are concerned with nonproliferation, counterproliferation and arms control functions, so they can be more or less relevant depending on the products and/or services being sold or offered.

Q.  How much can fines for sanctions violations be?

A.  The State Department doesn't explicitly list dollar amounts in their documentation, even though they do state "Civil and criminal penalties may be assessed for violations."

However, fines for violations of other watch lists can be substantial.  Depending on the program, criminal penalties can include fines ranging from $50,000 to $10,000,000 and imprisonment ranging from 10 to 30 years for willful violations.  Depending on the program, civil penalties range from $11,000 to $1,000,000 for each violation.

In August of 2007, the government announced that had paid a settlement of $182,750 for a sanction violation.  A number of other companies have been fined over $200,000 in 2007 alone.

Q.  How come I haven't heard of this before?

A.  Government sanctions have existed for many years, but since the terrorist attacks of September 11, 2001 the Federal government has dramatically increased its use of watch lists.  The government considers watch lists like OFAC to be a valuable weapon against terrorist and criminal organizations.

Q.  How can I ensure that my business stays in compliance?

A.  Verifilter continually monitors the relevant government watch lists, collecting them into a single, easy-to-search master list.  Subscribe to our service and you'll get instant access to our search facilities, including web-based checking and easy integration into your own web site.

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