The US Treasury Department has removed 84 individuals and entities from the Specially Designated Nationals and Blocked Persons List. This action is part of a broad review of economic sanctions programs that began in May.
With this latest update, the total number of old records deleted from the list reaches 160. In the first phase of the review, the Treasury removed 76 records pertaining to individuals, companies, vessels, and related assets.
Outdated and Duplicate Records Cleared
The Treasury removed companies that are no longer operational and former targets that have lost their connection to current security threats. Among those removed were 36 deceased individuals and related records.
Thirty-three of the removed records were individuals and entities added under Iraq sanctions in 1991 and 1992. Some of these old Iraq-related records lacked distinguishing information such as date of birth, citizenship, identification number, or physical address.
Seven old Colombia-linked drug records were removed from the list. Additionally, records related to eight major drug traffickers whose operations have ended or whose networks have been dismantled were also removed.
The review revealed that the same individual or entity had multiple entries on the sanctions list. The US Office of Foreign Assets Control corrected 18 groups of duplicate records where the same target was repeated across different files.
Improving Data for Financial Compliance
The Treasury updated files for 22 individuals and entities with incomplete or unclear identifying information. The updates included adding details such as date of birth, place of birth, citizenship, identification number, and gender to help banks correctly identify individuals.
Insufficient information in old records could cause unnecessary blocking of money transfers by customers with the same or similar names as sanctioned individuals. Banks are forced to use additional resources to re-examine transactions, request documents from customers, and eliminate false matches.
The deletion of duplicate files and the detailing of identifying information aim to reduce false alarms, delayed international payments, and unnecessary compliance reviews. According to the Treasury, this process will provide more current and distinctive data for use in compliance screenings.
Sanctions Growth and Future Focus
Banks are required to compare their customers and international money transfers against these sanctions lists. The rapid growth of the list has increased compliance costs for financial institutions in terms of software, personnel, and legal consulting.
The growth of the list also increases the risk that real security threats are overlooked among the large number of old or incomplete records. The US has more than 17,000 individuals, companies, organizations, vessels, and related assets across its various sanctions programs.
In 2017, 880 new records were added to US sanctions lists. In 2024, the number of new records added to US sanctions lists exceeded 3,000. Russia's invasion of Ukraine, Iran's energy and financial network, international drug cartels, terrorism financing, and cyberattacks were key drivers of the expansion of sanctions lists.
The US Treasury stated it will focus on the economic and security impact of sanctions lists rather than their size. The goal of weeding out old records is to enable banks to allocate more resources to high-risk transactions such as terrorism financing, drug trafficking, cyberattacks, and sanctions violations.
The Treasury stated that economic sanctions should not automatically be maintained indefinitely. It argued that records should be reassessed when a person dies, a company closes, the reason for sanctions no longer applies, or the target changes its behavior.
The latest decision does not represent a general easing of sanctions on Russia, Iran, or other active sanctions programs. The administration stated that financial pressure on active targets will continue while outdated records are cleaned up.
New Portal for Removal Requests
The US Treasury opened a new internet portal on June 29 for individuals and companies wishing to apply for removal from the sanctions list. Applicants can submit documents through the portal showing that the reason for sanctions is no longer valid, that they have changed their activities, or that the wrong person or company was targeted.
The portal centralizes and makes trackable a process previously conducted via letter and email. The Treasury stated that applications will not be automatically accepted and each request will be reviewed together with intelligence, security, and foreign policy institutions.
For removal from the list, a meaningful change in the conditions that led to the sanctioning of the target is required. The US administration emphasized that removal from the sanctions list does not mean past activities have been cleared.
The Treasury stated that removed individuals and entities could be re-listed if new information or activities threatening national security are identified. Despite the removal of 160 old records in the last two decisions, the review is still in its early stages given the total list of over 17,000 entries.
The US Treasury will continue to examine particularly old, incomplete, duplicate, or operationally unclear targets. New removal and record update decisions are expected in the coming period.
Financial institutions will continue to monitor the possibility of removed targets being re-listed and will track sanctions lists from other jurisdictions such as the European Union and the United Kingdom.