|SAN FRANCISCO, CA – Imagine going to the bank only to discover that your account is frozen because the government has branded you a “terrorist.” The Office of Foreign Assets Control (OFAC) of the U.S. Department of Treasury has the power to do this—behind closed doors, without notice, and with no adequate proce¬dures in place for you to effectively challenge the designation.
"The OFAC List: Due Process Challenges in Designation and Delisting", a new report published by the Lawyers’ Committee for Civil Rights of the San Francisco Bay Area (Lawyers’ Committee), follows the 2007 report, “The OFAC List: How a Treasury Department Terrorist Watchlist Ensnares Everyday Consumers”, which addressed the difficulties encountered by consumers with names similar or identical to individuals on OFAC’s list. Today’s report, published in collaboration with its pro bono partner Kilpatrick Townsend & Stockton LLP, (“Kilpatrick Townsend”) examines how OFAC uses its broad powers to designate individuals and organizations—including charities—as “global terrorists” and freezes their financial assets. The report also explores the considerable challenges faced by those who wish to contest their designation and makes several recommendations to address the serious due process concerns identified by the Federal Courts.
OFAC has no specific criteria governing how an entity is designated a “global terrorist.” OFAC neither provides sufficient notice of the alleged violation nor adequate access to the evidence upon which OFAC bases any decision to freeze assets. Making matters even worse, individuals and groups may wait years until OFAC provides a response to requests to unblock assets—all the while their assets remain frozen.
“While the ability to freeze assets can be an important tool to help prevent the funding of terrorism,” says Paul R. Chavez, Senior Attorney at the Lawyers’ Committee, “OFAC’s blocking powers are essentially unchecked, which has caused severe harm to innocent individuals and entities and deprived them of their constitutional right to due process. More must be done to ensure that this strategy is implemented in a constitutionally sound manner.”
In 2007, to uncover further information about the workings of OFAC’s designation procedures, the Lawyers’ Committee brought a federal court action against the Treasury Department under the Freedom of Information Act, seeking the disclosure of records of those contesting OFAC’s designation. In the course of this litiga¬tion, we succeeded in obtaining copies of more than 100 delisting petitions, further revealing the injustices and chal¬lenges faced by those who were intentionally, but errone¬ously, designated as terrorists by OFAC. Interviews with defense counsel have also shed light on the often insurmountable legal challenges their clients encounter when attempting to be “delisted” by OFAC. Today’s report explores those challenges and offers several recommendations for reforming OFAC’s process and procedures.
“We hope the U.S. government adopts the reforms we recommend to ensure that OFAC’s procedures are made transparent and fair. This will lead to a more accurate designation of real terrorists and, ultimately, a more effective way to combat terrorism,” says Holly Gaudreau, lead author of the report, and Counsel at Kilpatrick Townsend.
Both reports can be downloaded here:
2014 - The OFAC List: Due Process Challenges in Designation and Delisting
2007- The OFAC List: How a Treasury Department Watchlist Ensnares Everyday Consumers
Lawyers’ Committee for Civil Rights of the San Francisco Bay Area, founded in 1968, works to advance, protect and promote the legal rights of communities of color, and low-income persons, immigrants, and refugees. Assisted by hundreds of pro bono attorneys, LCCR provides free legal assistance and representation to individuals on civil legal matters through direct services, impact litigation and policy advocacy.