In late 2018, the U.S. imposed financial sanctions on Nicaragua’s Vice President Rosario Murillo, President Daniel Ortega, and Nicaragua’s Bank Corp pursuant to Executive Order 13851. The United States claims that the Ortega government is corrupt, and human rights and anti-democratic activities in Nicaragua have resulted in a crisis.
With this designation, U.S. persons are prohibited from engaging in any transactions with Banco Corporativo SA as well as any entity owned 50 percent or more by this bank. The same restrictions apply to transactions with Vice President Murillo and any entities that she has 50 percent or more ownership of in Nicaragua or abroad.
Details of the New Sanctions Regime
By imposing these sanctions, the U.S. hopes to alter the behavior of the Nicaraguan government so that it does not prohibit democratic activity by the people. The United States also hopes to stop them from engaging in corrupt business practices and dealings, including money laundering.
Notably, this has occurred before with Nicaragua. The U.S. government has previously sanctioned various government officials and companies engaging in money laundering in Nicaragua, including President Ortega and figures in his regime.
What Does it Mean for a Sanction to be Placed on a Specific Person?
A sanction placed on a specific person, typically known as designating or placing someone on the specially-designated national list, means that U.S. persons and entities are prohibited from engaging in trades of both goods and services with the designated person or entity, with few exceptions. These exceptions are typically general licenses in the regulation that was used to designate that person or entity.
Discuss Sanctions Compliance with an Experienced OFAC Attorney
To avoid potential sanctions violations, U.S. businesses should be wary of any dealings with Nicaraguan entities. U.S. authorities take sanctions violations seriously, and it is critical to ensure that any transactions are conducted in accordance with OFAC regulations. A knowledgeable OFAC attorney could help you review transactions to ensure compliance or acquire the licenses you need to conduct your business. To schedule a consultation, call today.