The Office of Foreign Assets Control requirements have an extraterritorial reach because compliance is required by:

Question

Options

• AUS persons in the US.
• Bintermediaries of a transaction with a US nexus.
• Centities registered in the US.
• Dforeign financial intelligence units.

• A
  3% (1)
• B
  79% (23)
• C
  10% (3)
• D
  7% (2)

Explanation

The Office of Foreign Assets Control (OFAC) is the U.S. Treasury Department's agency that administers and enforces economic sanctions programs against countries, groups, and individuals that pose a threat to the national security, foreign policy, or economy of the U.S. OFAC's requirements have an extraterritorial reach because they apply not only to U.S. persons (citizens, permanent residents, entities, and those physically present in the U.S.), but also to any person or entity that engages in a transaction that has a connection to the U.S., such as using the U.S. financial system, U.S. goods, or U.S. persons. This means that intermediaries of a transaction with a U.S. nexus, such as foreign banks, brokers, or agents, are required to comply with OFAC's regulations and may face penalties for violating them. OFAC's jurisdiction does not depend on the registration or incorporation of an entity in the U.S., nor does it extend to foreign financial intelligence units, unless they are involved in a transaction with a U.S. nexus.

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