Trade Embargo Enforcement Shifted to Customs

The federal agency charged with implementing U.S. trade embargoes, under investigation for its own action in several cases, has been stripped of its investigative and enforcement division.

Treasury officials said the action was designed to make trade embargo enforcement more efficient and was unrelated to the ongoing investigation of the Office of Foreign Assets Control.

OFAC’s enforcement division, and its five criminal investigators, will be reassigned to the Customs Service this month.

“There will still be enforcement of OFAC regulations, but it will now happen at Customs,” Treasury spokesman Howard Schloss said. “We did this to enhance enforcement and coordination.”

Schloss called the move an outgrowth of the Clinton Administration’s “reinventing government” initiative.

A series of Associated Press stories over the last year disclosed several cases in which longtime OFAC Director R. Richard Newcomb failed to follow his staff’s repeated urgings to take criminal action against major American businesses suspected of violating the high-profile embargoes against Haiti and Vietnam.