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1 1 (June 12, 2018)

handle is hein.crs/govzej0001 and id is 1 raw text is: $ Congressional Research Service Informir g the I gislative debate ir cc 1914 S June 12, 2018 International Narcotics Trafficking Sanctions: An Overview Overview The Office of Foreign Assets Control (OFAC) within the U.S. Department of the Treasury administers and enforces economic sanctions that target foreign entities and persons for their activities related to terrorism, narcotics trafficking, and other threats to the national security, foreign policy, or economy of the United States. Two of OFAC's sanctions programs specifically address drug trafficking. Then- President Bill Clinton ordered the first in 1995 to target the drug trafficking threat emerging from Colombia. Congress enacted the second in 1999 to expand the scope of drug trafficking sanctions globally. As of June 2018, OFAC lists 1,209 unique drug trafficking-related individuals and 1,170 entities for sanction (excluding aliases and removals). Executive Order 12978 On October 21, 1995, the President signed Executive Order (E.O.) 12978, Blocking Assets and Prohibiting Transactions with Significant Narcotics Traffickers. E.O. 12978 sought to combat drug trafficking by targeting traffickers' illicit wealth. Based on authorities in the National Emergencies Act (50 U.S.C. 1601 et seq.) and the International Emergency Economic Powers Act (IEEPA; 50 U.S.C. 1701 et seq.), this sanctions program allows the President to freeze U.S.-based assets of significant foreign narcotics traffickers centered in Colombia. Foreign Narcotics Kingpin Designation Act On December 3, 1999, the Foreign Narcotics Kingpin Designation Act was signed into law (Title III of P.L. 106- 120, as amended; 21 U.S.C. 1901 et seq.). The Kingpin Act sought to expand E.O. 12978 to apply globally, freezing U.S.-based assets of significant foreign narcotics traffickers, their organizations, and those who support them. The act also authorizes the State Department to make designated foreign individuals ineligible for U.S. entry, pursuant to the Immigration and Nationality Act. As the drug trade evolved beyond Colombia, the Kingpin Act has become the primary authority for applying U.S. sanctions to combat international drug trafficking. Figure I. Kingpin Act Trends: 2000-June 5, 2018 300 250 5 Kingpm Act designations, biockings 200 * Removals, nd blockings 150 100 50 0C W CO !n r0 N CO CpL t 0- ) 0 0 ri D rA 0- d 4 Source: U.S. Department of the Treasury. E.O. 12978 and the Kingpin Act, Compared Although implementation of the two sanctions programs remains distinct, E.O. 12978 and the Kingpin Act are designed to achieve the same purpose: to target traffickers who play a significant role in international narcotics trafficking, those who materially assist or support their trafficking activities, and persons or entities owned, controlled, or acting on behalf of traffickers. Both sanctions programs do this by (1) publicly designating individuals and entities; (2) blocking their property and interests in property under U.S. jurisdiction; (3) prohibiting U.S. persons from entering into transactions related to the property or interests in property of those designated; and (4) enforcing violations with civil and/or criminal penalties. Besides the key difference in geographical scope of the two programs, they differ most with respect to the severity of civil and criminal penalties associated with each. For enforcement of E.O. 12978, the maximum civil penalty per violation is prescribed by IEEPA, as adjusted by the Federal Civil Penalties Inflation Adjustment Act of 1990 (28 U.S.C. 2461 note): in mid-2018, the greater of $295,141 or an amount that is twice that of the underlying transaction. Under IEEPA, maximum criminal penalties include fines up to $1 million and imprisonment for up to 20 years. In contrast, the Kingpin Act prescribes higher penalties. As adjusted by the Federal Civil Penalties Inflation Adjustment Act of 1990, the maximum civil penalty is $1,466,485 per violation, as of mid-2018. Under the Kingpin Act, maximum criminal penalties for corporate officers can reach up to $5 million and 30 years' imprisonment and for corporations up to $10 million. Others may face fines pursuant to Title 18 U.S. Code and up to 10 years in prison. In comparison to E.O. 12978, the Kingpin Act also requires Treasury to consult with more departments and agencies when deciding to make new designations. In addition, the scope of authorized or exempt transactions described in the implementing regulations for each of the two sanctions programs differ slightly (31 C.F.R. Part 536 for E.O. 12978 and Part 598 for the Kingpin Act). Developments in 2018 Since January 1, 2018, OFAC has designated 69 individuals and entities pursuant to the Kingpin Act and none pursuant to E.O. 12978. Notable Kingpin Act designations in 2018 include the following: * Colombians linked to La Oficina de Envigado. On February 14, OFAC continued its pressure against La Oficina, a Medellin-based criminal organization involved in narcotics trafficking, money laundering, extortion, and murder for hire, by designating several Colombians linked to the group. ttps://crsreports.congress.gos

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