OFAC Consolidates Sanctions Penalty Provisions into New Federal Regulations
The Treasury Department’s Office of Foreign Assets Control (OFAC) has issued a final rule, effective September 25, 2026, adding a new part 505, the Sanctions Penalties Regulations, to title 31 of the Code of Federal Regulations (CFR). This rule consolidates penalty information that applies to multiple sanctions programs, which was previously scattered across individual parts of 31 CFR chapter V. OFAC states that the rule makes no substantive changes to these penalty provisions but aims to standardize them and ease compliance with the Federal Civil Penalties Inflation Adjustment Act of 1990. The initial version of the regulations covers penalties for violations of sanctions issued under the International Emergency Economic Powers Act (IEEPA) and the United Nations Participation Act (UNPA). The rule outlines enforcement procedures, including the issuance of a written Pre-Penalty Notice, a 30-day response period for alleged violators, and the process for challenging a Penalty Notice in federal district court.
