Under the Office of Foreign Assets Control (OFAC) sanctions, individuals and companies may be prohibited from doing business with a certain foreign government, company, or national. However, OFAC sanctions can also play a role in charitable giving to nonprofit organizations. Before donating to a foreign charity, individuals should consult an OFAC sanctions attorney for help making sure their contribution complies with OFAC regulations.
Can Individuals Donate to Charities Operating in Sanctioned Countries?
The rules governing charitable giving differ with every sanctions regime and affected country. A private individual may be able to donate funds directly to a foreign charity, or the donation may need to go through a non-governmental organization (NGO) which then contributes to a cause in the sanctioned country. Generally speaking, a person would want to consult an OFAC sanctions attorney to ensure that the donations are permitted under US sanctions.
For example, the Iranian Transactions and Sanctions Regulations (ITSR) does not permit certain private personal donations to charities abroad. There is a risk that some charities may be involved with organizations that engage in illicit activities, and the United States wants large-scale organizations, like NGOs, to perform the necessary internal compliance policies to protect the charitable funds. When an individual donates directly to a foreign charity, the US government cannot ensure sanctions compliance.
Importance of Working With an OFAC Sanctions Attorney
It is important for both individuals and organizations to speak with an OFAC sanctions attorney before donating to a charity operating in a foreign country. An attorney could review all the relevant sanctions regulations to ensure that humanitarian aid is performed with the necessary general licenses and according to proper procedures. An OFAC lawyer could review all the transactions necessary and ordinarily incident to providing aid in the sanctioned country. OFAC compliance can be complicated, and certain transactions that seem innocuous may incur sanctions liability in certain circumstances.
It is important for organizations to have a sanctions compliance policy in place and understand the applicable regulations before engaging in large-scale humanitarian aid projects in a sanctioned country. A knowledgeable OFAC attorney could help organizations review the specific entities, industries, or government institutions that are subject to US sanctions. A lawyer could help review the necessary financial transactions and the goods and services that are going to be exported to the sanctioned country. If specific licenses are required, an OFAC attorney could help organizations obtain them in pursuit of their humanitarian work.