On March 25, 2019, the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC), along with the U.S. Department of State and the U.S. Coast Guard, issued an updated version of a similar advisory issued on November 20, 2018 regarding sanctions risks related to shipping petroleum to Syria. In an effort to further isolate Syria's leadership and its supporters from global financial and trading systems, the updated advisory (1) reiterates warnings to persons involved in petroleum-related shipments to Syria, (2) identifies deceptive shipping practices being used to circumvent sanctions prohibitions, (3) recommends risk mitigation measures for implementation, and (4) provides non-exhaustive but updated lists of vessels that have participated in petroleum-related transactions with Syria since 2016.
The updated Syria Advisory stands as both a reminder and a worldwide caution regarding the significant risks and consequences of violating U.S. economic sanctions programs against Syria and Iran. OFAC particularly emphasizes the risk to "entities and individuals in the shipping industry, including shipping companies, vessel owners, managers, operators, insurers, and financial institutions."
In addition to the list of deceptive practices mentioned in the November 2018 Syria Advisory, which included (1) Falsifying Cargo and Vessel Documents, (2) Ship-to-Ship (STS) Transfers, and (3) Disabling Automatic Identification Systems (AIS), the updated Syria Advisory identifies Vessel Name Changes as another deceptive practice that persons in the petroleum shipping industry have recently used. OFAC continues to recommend the following risk mitigation measures:
-
Strengthen Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) compliance;
-
Monitor for Automatic Identification Systems (AIS) manipulation;
-
Review all applicable shipping documentation;
-
"Know your customer;"
-
Communicate clearly with international partners;
-
Leverage available resources; and
-
Understand the specific risks associated with Syrian and Iranian maritime-related activities.
Notably, the updated Syria Advisory names Russia and Iran as two countries involved in providing Syria with petroleum, expands non-exhaustive lists of ships that delivered oil shipments to (and from) Syria since 2016, and includes a list of vessels that have been involved in STS transfers of petroleum destined for Syria between 2016 and 2019. Significant for compliance efforts, OFAC clarifies that a vessel's presence on these lists "does not constitute a determination by OFAC that the vessel has been identified as property in which a blocked person has an interest."
