sanctions, export controls & aml practice...export control compliance is to tailor our...

SANCTIONS, EXPORT CONTROLS & AML PRACTICE

1 Morrison & Foerser LLP

SANCTIONS / EXPORT CONTROLS & ANTI-MONEY LAUNDERING

Morrison & Foerster regularly advises clients on all aspects of economic and trade sanctions, export control requirements, and Bank Secrecy Act/anti-money laundering (BSA/AML). Our multi-practice group approach brings together colleagues with extensive experience from across our global footprint. We regularly provide advice and counseling on sanctions, export control requirements, and BSA/AML; guide the development and implementation of comprehensive compliance programs for clients; oversee large-scale sanctions/AML/export control investigations; and provide enforcement expertise and defense before government agencies, such as the U.S. Departments of Commerce, Justice, and the Treasury, and other government regulators and prosecutors.

Sanctions and Embargoes

In the rapidly changing sanctions environment, as Iran sanctions “snap back” and Russia sanctions roil worldwide markets, we provide expertise and up-to-the-minute guidance to global financial institutions and multinational companies that have to comply with differing sanctions rules across jurisdictions. Our sanctions expertise combined with our deep understanding of the FinTech and emerging technologies sectors allow us to guide our high-tech clients as they grapple with applying traditional sanctions rules to the novel scenarios confronting today’s industry.

Morrison & Foerster lawyers help clients understand the various sanctions regimes implemented by the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC), assist them on discrete issues, such as obtaining an OFAC license for the release of blocked funds or to permit an otherwise prohibited transaction; and handle broad sanctions investigation and enforcement matters. When new sanctions are imposed (whether by legislation, executive order, or implementing regulations), we assist clients in updating their policies and procedures to ensure best compliance practices.

Chambers USA 2018 Financial Services Regulation: Banking (Compliance): Nationwide

White-Collar Crime & Government Investigations: New York

Legal 500 US 2018 Financial Services Regulation: National

White-Collar Criminal Defense: National

IFLR1000 2018 United States: Financial Services Regulatory


We also assist our clients with assessments of their OFAC policies and procedures, conduct internal investigations to identify issues that contributed to deficiencies in their OFAC compliance programs, provide training on sanctions issues, and help them develop strategic plans to improve their systems and procedures to address the identified compliance gaps.

Export Controls

Our team also possesses deep experience advising clients with respect to export control considerations under the Export Administration Regulations administered by the U.S. Commerce Department’s Bureau of Industry and Security (BIS) and the International Traffic in Arms Regulations administered by the Department of State’s Directorate of Defense Trade Controls (DDTC) and comparable European Union export controls. Our approach to export control compliance is to tailor our representation and advice to the specific requirements of the client based on their products, technology, operations, and export activities. We routinely obtain BIS classification rulings that will determine the specific export restrictions applicable to a product or technology. We assist clients in developing appropriate export compliance programs to prevent inadvertent export control violations. This may involve establishing controls to prevent sales to persons or entities on the BIS Table of Denial Orders or Entities List and transactions with U.S.-embargoed countries and persons and entities on OFAC’s Specially Designated Nationals and Blocked Persons List.

We also assist clients in dealing with inadvertent export control violations. This frequently requires undertaking a thorough review to evaluate whether, in fact, a violation has occurred. As part of this exercise, we often conduct an internal investigation to determine how the transaction was effected and develop safeguards to prevent any further violations. Once the facts are established, we develop, with the client, an appropriate disclosure of the violation to the relevant enforcement agency, if warranted. We also advise clients in defending against enforcement actions related to potential export control violations.

For items requiring an export license, we assist clients in obtaining the required export approvals and establishing appropriate safeguards to ensure compliance with the terms of the export license. We routinely obtain BIS export licenses on behalf of our clients and, for clients with in-house export control expertise, advise on developing appropriate arguments in support of the export license. We also obtain DDTC export licenses covering items on the U.S. Munitions List and have assisted clients in registering with DDTC as manufacturers or exporters of defense articles or services.

BSA/AML

Our experience ranges from advising clients on discrete BSA/AML compliance questions to supporting clients in regulatory examinations and enforcement actions. We routinely advise clients on a day-to-day basis with regard to BSA/AML questions they face in the course of their business; provide assistance in the investigation and decision-making processes related to suspicious activity reporting and other regulatory reporting; support clients in enhancing and updating their BSA/AML compliance programs; advise clients on the most recent statutory and regulatory changes (such as the Financial Crimes Enforcement Network’s (FinCEN) Customer Due Diligence Rule or the New York Department of Financial Services’ (NYDFS) new transaction monitoring and filtering program requirements under the NYDFS’s Part 504) and how they affect a client’s BSA/AML and OFAC compliance; provide training on all BSA/AML-related issues; and assist clients with regard to BSA/AML and OFAC due diligence on potential investments.

In this regard, we work closely with domestic and foreign financial institutions, as well as non-financial institution clients, to address compliance issues under the applicable BSA/AML rules, including the requirements to


(i) develop and maintain a comprehensive, risk-based BSA/AML compliance program; (ii) establish and maintain internal controls and processes; and (iii) develop an appropriate risk assessment of the particular financial institution’s products, services, customers, and geographic locations.

We also assist our clients with assessments of their respective BSA/AML policies and procedures, including those implemented to prepare, review, and file suspicious activity reports (SARs), currency transaction reports (CTRs), and responses to law enforcement inquiries relating to customer activities. In addition, we have conducted domestic as well as cross-border internal investigations for financial institutions, including their holding companies and affiliates, to identify issues that contributed to deficiencies in their previous BSA/AML compliance programs and worked with them to adopt strategic plans to improve their systems and procedures to address the identified gaps in BSA/AML compliance processes.

Enforcement

We are often called on to assist financial and non-financial institutions with investigative matters, including responding to grand jury investigations and subpoena inquiries; conducting domestic as well as cross-border internal investigations; and representing institutions in regulatory and/or criminal and civil enforcement actions in front of various federal and state law enforcement agencies and regulators (including federal and state prosecutorial entities, OFAC, FinCEN, BIS, the Federal Reserve, the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), the NYDFS, the California Department of Business Oversight, and other regulators). These matters allow us to combine our award-winning white-collar and litigation practice, our internationally renowned bank regulatory and financial services practice, and our deep expertise in sanctions, export controls, and BSA/AML. Our lawyers not only master the legal issues but also have a deep knowledge and understanding of the financial industry and its products, services, and players, as well as global corporations across the spectrum of industries. Handling such matters with a team drawn from across our practice groups and across the globe allows us to provide the most effective representation for our clients.

Overall, we see a trend toward increased supervision and enforcement of BSA/AML and OFAC-related issues from state and federal regulators and law enforcement agencies. With our global presence and extensive regulatory and law enforcement experience, we have the skills and resources needed to provide exemplary representation to national and international banks, bank holding companies, investment companies, investment advisers, money service businesses, clients from emerging industries such as FinTech, and non-financial institutions.

SELECT REPRESENTATIONS

Sanctions and Exports

• Advise multinational financial institutions and global companies on compliance issues arising from the 2018 “snap back” of U.S. sanctions following JCPOA termination.

• Conduct internal investigation of a large foreign bank regarding potential violations of OFAC sanctions and anti-money laundering practices.

• Represent large foreign bank in regulatory and criminal enforcement actions related to potential violations of economic sanctions and anti-money laundering practices.

• Advise a U.S. bank in implementing policies and procedures and communicating with customers regarding changes required by FinCEN’s beneficial owner rule.


• Represent a publicly listed Asian company in evaluating permissible Iranian trading activities and impact of Ukraine-related sanctions on potential investment transactions with Russian sovereign wealth fund.

• Represent a U.S. media company in contract dispute with company controlled by Ukraine-based EU-sanctioned individual.

• Represent an Asian, state-owned heavy equipment manufacturing company on compliance with U.S. and EU sanctions in connection with initial public offering. Ongoing compliance training.

• Represent an Asian consumer products company in addressing U.S.-Iran sanctions impact on “stranded rials” in Iranian subsidiary.

• Represent global financial services company in structuring worldwide payment systems to comply with OFAC regulations.

• Obtain OFAC licenses to permit U.S. companies to engage in otherwise prohibited transactions.

• Develop OFAC compliance program for U.S. and foreign subsidiaries of numerous multinational corporations, including establishment of procedures to determine U.S. origin and content and prevention of “facilitation.”

• Represent Asian turbine equipment manufacturer in evaluating maintenance contracts with Iranian entities.

• Represent Asian automobile manufacturer in evaluating joint ventures in sanctioned countries.

• Represent Asian equipment manufacturer on U.S. OFAC compliance and potential enforcement issues arising from contracts for supply of equipment to Iran, including issues relating to non-U.S. persons’ liability under U.S. law regarding transactions with Iran.

• Represent Asian insurance companies in OFAC compliance issues regarding co-investment with Iranian

government-owned companies.

• Represent Chinese trading company in dealing with OFAC freezing of funds in connection with shipments of goods on Iranian-owned blocked vessels.

• Conduct internal investigation for Board of Directors of government-owned international telecommunications company regarding potential violations of OFAC statutes and regulations by engaging in transactions with Cuba, Iran, Sudan, and Syria, including doing business with a company listed by OFAC as an SDN. Advise client on risks, potential penalties, and available remedies. Detailed review of internal documents and interviews with senior executives and directors.

• Advise non-U.S. government-owned bank in OFAC negotiations regarding potential violations of U.S. prohibitions on non-U.S. persons doing business with Iran.

• Advise U.S. shipping company in compliance matters and OFAC investigation regarding potential violations

of Iranian sanctions.

• Advise U.S. pharmaceutical manufacturing company in obtaining OFAC license to sell medical supplies to Iran.

• Advise global pharmaceutical company on compliance with OFAC licensing requirements for shipment of medical supplies to Iran.


• Represent non-EU companies on EU sanctions regimes related to Iran, Syria, and Ukraine/Russia.

• Represent German, EU, and non-EU companies on import and export control issues under German foreign trade laws.

• Represent clients in civil and criminal investigation by BIS and DOJ of export diversion allegations.

• Obtain BIS and DDTC export licenses for numerous clients across diverse industries.

• Establish sanctions and export compliance program for entities in various industries, including semiconductors, telecommunications, software development, financial services, and manufacturing.

• Conduct export audits for semiconductor manufacturers, consumer goods producers, research and development facilities, software developers, and telecommunications equipment manufacturers.

• Assisted client sanctioned under U.S. non-proliferation prohibitions and denied export licenses to be removed from State Department sanctioned parties list.

Anti-Money Laundering

• Conduct an internal investigation of a U.S. bank regarding potential BSA/AML violations and advise on enhancements to the bank’s overall BSA/AML compliance.

• Advise a large non-bank technology provider in BSA/AML compliance relating to payment technology solutions.

• Counsel a large e-commerce company in designing funds flows and payment platform design in light of potential BSA/AML risks.

• Represent a foreign bank in connection with a proposed enforcement action from U.S. banking regulators.

• Conduct an internal investigation on behalf of the Audit Committee of the Supervisory Board of ABN AMRO Bank N.V. regarding anti-money laundering policies and practices at the bank’s U.S. dollar-clearing unit.

• Represent the U.S. chief of compliance for a large U.S. bank in connection with government investigations into the bank’s BSA/AML compliance policies, with emphasis on the compliance group’s management of U.S.-Mexico border region risks, black market peso-exchange exposure, and cash-intensive customers.

• Represent the global head of AML for a large international bank in connection with a wide-ranging, government investigation into all aspects of the sufficiency of the bank’s BSA/AML program.

• Represent the global head of compliance for a large European bank in connection with a government investigation into bulk cash and correspondent banking business compliance with U.S. BSA/AML laws.

• Represent a pool of employees in Latin America for a large international bank in connection with government investigations into all aspects of the bank’s BSA/AML program.

• Assist a U.S. bank with internal review of CTR practices.

• Provide training to senior management, compliance, and other personnel regarding BSA/AML compliance.

• Advise various clients on addressing regulatory criticism and Matters Requiring Immediate Attention (MRIAs) and Matters Requiring Attention (MRAs) relating to BSA/AML.


• Advise U.S. banks and foreign banking organizations on enhancements to their BSA/AML program.

• Assist bank and nonbank clients in addressing CIP and KYC issues for new products.

OUR TEAM: WASHINGTON D.C.

John E. Smith Washington D.C.

John E. Smith served as the Director of OFAC, as well as its Deputy Director and Associate Director, for the past 11 years. Concurrent with serving as OFAC Director, Mr. Smith also served as acting Under Secretary for the Office of Terrorism and Financial Intelligence at Treasury (January 2017 to June 2017). Mr. Smith has overseen the U.S. government’s economic sanctions efforts, imposing sanctions on heads of state, countries, and illicit actors; conducting enforcement actions against dozens of major financial institutions and companies around the world; and developing innovative sanctions enforcement policies to address evolving U.S. national security priorities. Mr. Smith has also supervised the investigation, preparation, and settlement of cases for hundreds of millions of dollars. Mr. Smith is co-head of Morrison & Foerster’s National Security practice.

John P. Carlin Washington D.C.

John P. Carlin, former Assistant Attorney General for the U.S. Department of Justice’s National Security Division (NSD), chairs Morrison & Foerster’s global risk and crisis management team and advises industry-leading organizations in sensitive cyber, sanctions and embargoes, and other national security matters; white collar investigations; and government enforcement actions. During his time at the DOJ, Mr. Carlin prosecuted major sanctions and export controls matters, including significant civil and criminal penalties against major global actors and noteworthy cases against malicious cyber actors. As Chair of Morrison & Foerster’s global risk and crisis management practice, Mr. Carlin regularly advises leading U.S. and overseas companies across numerous industries—including in the technology, healthcare, fashion, media, pharmaceutical, and telecommunications sector—regarding crisis management, cyber incident response and preparedness, regulatory strategy, and CFIUS. Mr. Carlin is co-head of Morrison & Foerster’s National Security practice.

Nick Spiliotes Washington D.C.

Nick Spiliotes has 25 years of experience advising clients on national security compliance matters involving foreign investment approvals (CFIUS); Department of Defense, Department of Energy, and Nuclear Regulatory Commission foreign investment approvals under the National Industrial Security Program; and United States sanctions and embargoes (OFAC), including certain enforcement matters, relating to a broad range of industries, products, and transactions. Mr. Spiliotes is co-head of Morrison & Foerster’s National Security practice.


James Koukios Washington D.C.

James Koukios represents companies and individuals in high-stakes government enforcement actions and complex internal investigations. An experienced trial attorney and former federal prosecutor, Mr. Koukios has tried over 20 federal jury cases, including serving as the lead prosecutor in two landmark Foreign Corrupt Practices Act (FCPA)-related trials: United States v. Esquenazi and United States v. Duperval. Mr. Koukios also served as a lead prosecutor in United States v. AEY Inc., a defense procurement fraud and export licensing case that served as the basis for the 2016 film War Dogs.

Demme Doufekias Washington D.C.

Demme Doufekias is co-chair of the firm’s Securities Litigation, Enforcement, and White-Collar Criminal Defense Group. Ms. Doufekias regularly represents corporations and individuals in complex criminal investigations. Her practice focuses on cross-border internal, regulatory, and enforcement investigations. Her cases have involved alleged violations of FCPA and other anti-corruption laws, health care fraud and abuse laws, trade and sanctions laws, securities, wire fraud, and anti-money laundering statutes. She is a member of the firm’s global FCPA & Anti-Corruption and Health Care Fraud Task Forces. Ms. Doufekias has also successfully represented clients in federal and state trials.

Aki Bayz Washington, D.C.

Aki Bayz advises clients on compliance with the applicable trade-sanction and economic embargoes administered by OFAC; the export control and anti-boycott requirements of the BIS; and military items subject to the jurisdiction of the DDTC. Mr. Bayz’s clients come from a broad range of companies, from multinational corporations engaged in international transactions worldwide to startup entities exporting for the first time, and across an array of industries and sectors, including information technology, telecommunications, financial services, FinTech, basic commodities, consumer goods, defense electronics, aerospace, biotechnology, medical devices, and semiconductors.

David A. Newman Washington D.C.

David Newman is of counsel in the National Security and Global Risk & Crisis Management practices where he has extensive experience representing clients with national security law, crisis management, sanctions programs, and government regulation issues. Prior to joining Morrison & Foerster, Mr. Newman held several key posts at the White House, serving as Special Assistant and Associate Counsel to President Barack Obama and on the staff of the National Security Council.

Mingda Hang Washington D.C.

Mingda Hang is a seasoned associate who focuses his practice on white-collar criminal defense and internal investigations. He represents companies and individuals facing a wide range of allegations, including complex fraud, corruption, money laundering, securities fraud, and violations of the FCPA. He is experienced in working with and defending clients in front of government agencies including the DOJ, the Securities and Exchange Commission (SEC), the Federal Bureau of Investigation (FBI), the Drug and Enforcement Administration (DEA), and OFAC. He has been intimately involved in several high-profile cross-border investigations and has also worked closely with individual clients to resolve potential and actual criminal charges.


Vanshika Vij Washington D.C.

Vanshika Vij focuses her practice on white collar criminal defense and internal investigations, in front of the DOJ and SEC. She represents companies and individuals in connection with matters involving complex fraud, money laundering, and violations of the FCPA. Ms. Vij also has significant experience advising on the regulatory risks associated with proposed mergers and acquisitions.

OUR TEAM: NEW YORK

Barbara Mendelson New York

Barbara Mendelson is a partner in the Financial Services Group in the New York office. Her practice involves advising foreign and U.S. banks in a variety of complex regulatory matters, including sales and acquisitions of U.S. banking and nonbanking firms; Dodd-Frank Act issues; applications to federal and state bank regulators for expansion of activities and new products; Bank Secrecy Act and OFAC matters; and over-the-counter and exchange-based trading of various instruments and derivatives. She has represented foreign banks in their U.S. operations for more than 25 years.

Carl (“Chip”) H. Loewenson, Jr. New York

Chip Loewenson is a partner in the firm’s Securities Litigation, Enforcement, and White-Collar Defense Group. His practice focuses primarily on white-collar defense, including regulatory matters. His cases have included alleged insider trading, market manipulation and other securities fraud issues, foreign corrupt practices, government contract fraud, FDA reporting, trade secrets, customs violations, tax evasion, money laundering, price-fixing, healthcare fraud, false claims against the government, obstruction of justice, and attorney discipline. He has also handled significant civil litigation, including cases involving civil RICO, securities fraud, and trade secrets. Prior to joining Morrison & Foerster in 1990, Mr. Loewenson served as an Assistant United States Attorney in the Southern District of New York for five years.

Ruti Smithline New York

Ruti Smithline is a partner in the Securities Litigation, Enforcement, and White-Collar Criminal Defense Group. Her practice focuses on cross-border corporate internal investigations and white-collar criminal defense matters. She regularly advises individual and corporate clients in criminal matters and related civil enforcement and regulatory matters. Her cases have involved alleged violations of the FCPA and other anti-corruption laws, money laundering and Bank Secrecy Act, trade and sanctions laws, securities fraud, and a myriad of compliance issues. She is a member of the firm’s global FCPA & Anti-Corruption Task Force. As a native Spanish-speaker, her practice focuses on internal investigations and related compliance work throughout Latin America.


Marc-Alain Galeazzi New York

Marc-Alain Galeazzi is of counsel in the Financial Services Group in the New York office. Mr. Galeazzi’s practice focuses on advising and counseling foreign and domestic banks, financial holding companies, bank holding companies, and other financial institutions on a variety of bank regulatory and transactional matters. Mr. Galeazzi has particular experience in advising financial institutions on complex regulatory matters, including sales and acquisitions of U.S. banks, corporate governance and compliance matters (anti-money laundering, anti-corruption, economic sanctions (OFAC), and anti-terrorist financing), government investigations and enforcement actions, bank insolvency issues, and clearance and settlement systems.

Jeffrey Rosenberg New York

Jeffrey Rosenberg is a litigator in the firm’s New York office. His practice focuses on representing financial institution clients in complex litigation and investigation matters. Mr. Rosenberg has particular experience defending clients in connection with government investigations and regulatory proceedings related to anti-money laundering and sanctions laws. In addition, he advises clients on a multitude of compliance issues, including involving the Bank Secrecy Act and trade sanctions and economic embargoes. Mr. Rosenberg also has extensive experience working with banks to manage the discovery and evidentiary burdens of litigation and complex investigations.

Cesar Francia New York

Cesar A. Francia is an associate in the firm’s Securities Litigation, Enforcement, and White Collar Criminal Defense Group. He routinely provides counseling, develops compliance policies and programs, and conducts internal and government-facing investigations, including those relating to the FCPA. Mr. Francia is currently serving as a member of the team working with the DOJ-appointed monitor in the criminal prosecution of Odebrecht for violations of the FCPA brought by the U.S. Attorney’s Office for the Eastern District of New York. He previously served as a core member of a team appointed by the New York State Department of Financial Services to investigate and monitor one of the world’s largest corporate and investment banks, where he worked on assessing the banks’ compliance with sanctions and anti-money laundering regulations. Mr. Francia also has particular experience representing clients in matters concerning anti-money laundering laws and the Bank Secrecy Act.

Andreea Vasiliu New York

Andreea Vasiliu is a New York-based associate in the firm’s Securities Litigation, Enforcement, and White-Collar Criminal Defense practice group. Her practice focuses on government and cross-border internal investigations. She represents clients in government investigations involving anti-corruption, anti-money laundering, and trade sanctions compliance (OFAC) issues. She has also worked on post-financial crisis government investigations into the residential mortgage-backed securitization practices of major banks.


OUR TEAM: EUROPE

Kevin Roberts London

Kevin Roberts is a litigation partner in the London office of Morrison & Foerster, specializing in regulatory compliance and investigations and white-collar crime. Mr. Roberts’s practice ranges from regulatory matters dealt with by the Financial Conduct Authority, Medicines Healthcare Regulatory Authority, or the Health and Safety Executive, to prosecutions brought by the Serious Fraud Office. Mr. Roberts advises corporations and individuals in money laundering compliance and investigations, anti-corruption and regulatory compliance, asset tracing and recovery, tax investigations, and fraud. As part of his international practice, he advises on mutual assistance requests and extradition. He also advises clients in relation to Parliamentary Select Committee appearances.

Dr. Felix Helmstädter Berlin

Felix Helmstädter is of counsel at the German office of Morrison & Foerster in Berlin. He advises clients in the area of public commercial and regulatory law, in particular on all matters of German and European public procurement law, state aid law, and sector-specific regulatory law; foreign trade law, export control law, and EU sanctions law; and antitrust and merger control law. Felix Helmstädter has particular, industry-specific expertise in the areas of transportation, technology, media, and telecommunications. Another area of emphasis of his work lies in the health and energy sectors. He has years of experience in providing strategic regulatory advice to companies, as well as representing them in administrative litigation, civil litigation, and public procurement disputes before national and European authorities and courts.

Shruti Chandhok London

Shruti Chandhok is an associate in the firm’s Litigation Practice Group in the London office of Morrison & Foerster and a member of the firm’s Global Anti-Corruption practice. Ms. Chandhok advises on a range of complex commercial litigation including cases involving white collar, financial services, corporate investigations, and antitrust issues. She represents individuals and companies in internal corporate investigations and during investigation or prosecution by regulatory bodies, including the Financial Conduct Authority (FCA), the Serious Fraud Office (SFO), and the DOJ. She also has experience with insolvency matters and claims involving complex financial products. Ms. Chandhok is an active member of the firm’s pro bono practice.

sanctions, export controls & aml practice...export control compliance is to tailor our...

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