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ARTICLE · 09 APRIL 2026

OFAC Issues Sanctions Advisory On Sham Transactions, Identifies Red Flags

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On March 31, 2026, OFAC published a Sanctions Advisory that highlights compliance risks arising from sham transactions used to evade sanctions.

United StatesInternational Law
Nnedinma Ifudu Nweke
Nnedinma Ifudu Nweke
Jason Prince
Jason Prince
Wynn Segall
Wynn Segall
Andrew R. Schlossberg
Andrew R. Schlossberg
Michael Wain
Michael Wain
James Treanor
James Treanor
Brittany Crosby-Banyai
Brittany Crosby-Banyai
Mark Han-Sen Ye
Mark Han-Sen Ye
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Key Points

  • On March 31, 2026, OFAC published a Sanctions Advisory that highlights compliance risks arising from sham transactions used to evade sanctions.
  • The Sanctions Advisory highlights certain kinds of opaque legal structures, including trusts, that may be used to conceal a blocked person's continuing interest in property.
  • The Sanctions Advisory builds on OFAC's prior guidance by providing a non-exhaustive list of red flags that may be indicative of a sham transaction.
  • Companies should ensure that their sanctions compliance policies and procedures take into account the red flags identified by OFAC, including with respect to dealings that involve trusts and other complex legal structures, as well as dealings in property in which a blocked person may retain an indirect interest.

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