What is the primary function of OFAC?

The primary function of the Office of Foreign Assets Control (OFAC) is to administer and enforce economic and trade sanctions against targeted foreign countries and regimes, terrorists, international narcotics traffickers, and other threats to national security, foreign policy, or economy of the United States. This includes creating and maintaining a sanctions list that specifies individuals, organizations, and countries with which U.S. entities and individuals are prohibited from engaging in transactions or business dealings.

Sanctions enforced by OFAC can include asset freezes, restrictions on financial transactions, and trade prohibitions. The aim is to influence the behavior of foreign governments or entities without resorting to military action. By focusing on this enforcement of sanctions, OFAC plays a critical role in U.S. foreign policy and national security, ensuring that economic measures are an effective tool for the government to address various global issues.

Understanding the primary role of OFAC illuminates its significance in the broader context of international relations and compliance in financial sectors, while highlighting why other functions, such as regulating financial market practices, supervising banking institutions, or conducting economic policy research, are not the principal functions of this agency.