The final year of the Biden administration saw continued use of sanctions to curb Russia's sources of revenue, continued pressure on Iran, a variety of new and revised statutory authorities for sanctions, and notable legal challenges. Miller & Chevalier provides an overview of key developments concerning the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) and the enforcement of U.S. sanctions from January 2024 through the end of the Biden administration in January 2025.

Overall, 2024 was characterized by increasingly aggressive sanctions. While President Biden imposed far-reaching sanctions throughout his term, the pace accelerated in his final year. As in the preceding two years, most of the activity related to Russia. 

Russia, Third-Country Actors, and the War in Ukraine

Inhibiting Russia's War in Ukraine. In February 2024, to mark the second anniversary of Russia's invasion of Ukraine, OFAC and the U.S. Department of State announced the largest number of sanctions designations since the start of the war, designating nearly 500 individuals and entities (as previously discussed here). These additions were only the beginning: the U.S. continued to designate Russia-related persons, ending the year with eight separate announcements of 100 or more additions to OFAC's Specially Designated Nationals and Blocked Persons (SDN) list. The designations predominantly focused on expanding sanctions and service prohibitions to inhibit Russia's ability to wage war. Throughout the year, OFAC displayed a sharp focus on the financial and energy sectors, sanctioning major financial institutions, including banks and securities registrars, energy companies, leaders of oil companies, and shipping companies. OFAC also added sanctions aimed at supply chains, targeting not only Russian entities but also individuals and entities outside of Russia that furnish military material, electronics, and advanced machine tools destined for Russian use in its war against Ukraine.

Targeting Sanctions Evasion. Further reflecting the Biden administration's view of what constituted support for Russia's invasion of Ukraine, OFAC targeted Russian and third-country actors that provide financial tools and IT solutions that facilitate sanctions evasion. The U.S. also issued the first-ever joint guidance with the G7 (the U.S., Canada, France, Germany, Italy, Japan, the U.K., and the European Union (EU)) and the Global Export Control Coalition (GECC) (countries listed in supplement no. 3 to part 746 of the Export Administration Regulations (EAR)) to alert industry to and encourage industry assistance in preventing sanctions evasion.

Using Sanctions Aggressively. The U.S.'s use of sanctions against Russia went beyond simply adding thousands of persons to sanctions lists. Late in 2023, President Biden issued Executive Order (E.O.) 14114, which amended E.O. 14024 to give OFAC additional authority to sanction foreign financial institutions that facilitate significant transactions or provide services involving the Russian military-industrial base, and or that facilitate significant transactions involving designated persons acting in other specified sectors of the Russian economy. In 2024, OFAC expanded potential targets of this secondary sanctions authority by extending it to all SDNs designated under E.O. 14024. OFAC utilized this secondary sanctions authority in January 2025 to designate a Kyrgyz Republic-based bank allegedly involved in implementing a sanctions evasion scheme with a Russian bank. With complementary action by the Bureau of Industry and Security (BIS), OFAC also announced broad prohibitions on the provision of IT services to entities and customers in Russia. 

The aggressive approach continued through the final weeks of the Biden administration in January 2025. The U.S. Department of the Treasury imposed sanctions broadly on parties operating in Russia's energy sector, including upstream and downstream activities related to oil and natural gas. While the majority of Russia-related designations since February 2022 had been pursuant to E.O. 14024, OFAC redesignated over 100 parties under E.O. 13662, which institutes a procedural mechanism preventing the easing of these sanctions simply by presidential fiat. Instead, to lift these designations, the Trump administration will have to submit reports to Congress. 

Middle East

Re-designation of the Houthis. The U.S. continued to implement targeted sanctions in the Middle East, aiming to disrupt illicit networks, combat terrorism financing, and address regional security threats. As discussed in detail here, State re-designated Ansarallah (the Houthis) as a Specially Designated Global Terrorist (SDGT), effective February 16, 2024. OFAC also issued six general licenses, which authorized limited payments of taxes, fees, and import duties, and for the purchase or receipt of permits, licenses, and public utility services involving the Houthis, related to certain activities such as imports of agricultural commodities and medical devices and telecommunications services.

West Bank-related Sanctions. In response to the ongoing Israel/Gaza conflict, President Biden issued E.O. 14115 in February 2024, authorizing imposition of sanctions on persons involved in threatening the peace, security, and stability of the West Bank, and involved in violence targeting civilians, among other acts. Throughout the year, OFAC designated a number of individuals and entities pursuant to this authority. (On his first day in office in 2025, President Trump revoked E.O. 14115 via E.O. 14148, leading OFAC to remove the West Bank-related Sanctions program and delist all previously designated individuals and entities.)

Hamas-Related Designations. In a series of actions, OFAC imposed sanctions targeting Hamas's financial networks and key operatives. In January 2024, OFAC designated multiple individuals and entities associated with Hamas-affiliated financial exchanges and financial facilitators involved in cryptocurrency transfers. In 2024, exactly one year after the October 7, 2023 attack, OFAC targeted an international Hamas fundraising network, including sham charities used to facilitate millions of dollars to support Hamas. OFAC also collaborated with its international allies in Australia and the U.K. to issue joint designations further targeting Hamas financial networks. 

Iran

Targeting Election Interference. Upon identifying that the government of Iran undertook malicious cyber activities to undermine and interfere with the U.S.'s 2020 and 2024 presidential elections, the U.S. government took a variety of steps to disrupt those illicit activities. As part of this effort, OFAC sanctioned Iranian regime agents, including members of the Iranian Islamic Revolutionary Guard Corps (IRGC), for compromising accounts of officials and advisors to a 2024 presidential campaign and leaking stolen data to the media. 

Disrupting the UAV and Missile Industry. OFAC also sanctioned individuals and entities facilitating the proliferation of Iran's unmanned aerial vehicle (UAV) production, including companies that manufacture or procure key UAV components. The designations include entities based in China and Hong Kong that were involved in acquiring parts for Iran's UAV and ballistic missile programs. Some of these entities operated as front companies procuring electronics and equipment on behalf of Iranian end users, and others served as manufacturers or providers of items utilized in Iran's ballistic missile programs. 

Restricting Petroleum and Petrochemical Revenues. OFAC also issued a determination pursuant to E.O. 13902 targeting Iran's petroleum and petrochemical sectors for sanctions, concurrently designating an international network responsible for facilitating the shipment of millions of barrels of Iranian crude oil to China. These actions aim to limit Iran's ability to generate revenue from its energy exports, thereby constraining funding for its activities that undermine regional stability. 

Syria

Sanctions related to Syria were quiet for most of 2024, but that changed with the toppling of Bashar al-Assad's regime in December. Despite the regime change, Syria remains subject to comprehensive U.S. sanctions.¹ These sanctions remain in place in part because the new governing authority, Hayat Tahir al-Sham (HTS), and its leader, Ahmed Hussein ah-Sharaa (Abu Mohammed al-Jawlani), are themselves subject to U.S. sanctions due to their ties to al Qaeda and other terrorist organizations. 

Nevertheless, in order to facilitate international efforts to rebuild Syria, the Biden administration announced a temporary easing of restrictions related to essential services. As previously discussed, the general license allows U.S. persons to engage with the new government on issues related to the sale, supply, storage, or donation of energy, including oil and natural gas, and to process noncommercial personal remittances to Syria. However, the license expires in July 2025 and has a limited scope. For instance, it does not allow transactions with military or intelligence entities or new investments in the country by U.S. persons.

Venezuela

In late 2023, OFAC issued Venezuela-related general licenses in exchange for President Nicolás Maduro's agreement to hold free and fair elections. The licenses addressed transactions related to the oil and gas industry, the Venezuelan state-owned gold mining company, and the trading market for state sovereign bonds. In January 2024, Maduro broke the agreement, maintaining a ban that kept his opponent from holding office, and the U.S. revoked some of the general licenses. A few months later, as discussed here, the U.S. revoked another license, again prohibiting U.S. persons from transacting in the oil and gas sector.

Enforcement

OFAC's public enforcement settlements throughout 2024 and the first weeks of 2025 combined to total approximately $50 million in penalties — a far cry from the $1.5 billion levied in 2023, but significant nonetheless. Enforcement targets, alleged conduct, and the sanctions programs at issue varied. Several settlements involved non-U.S. companies across a range of industries that allegedly caused U.S. financial institutions to engage in unauthorized financial transactions including, for example, Iran and North Korea. U.S. companies settled enforcement actions for apparent violations such as sending refunds to parties in the United Arab Emirates that were subject to Russia-related sanctions (illustrating the importance of incorporating re-screening into sanctions compliance protocols), dealing in prohibited new debt by re-dating and re-issuing invoices after expiration of applicable maturity periods under the Ukraine-/Russia-Related Sanctions program, and "engaging in a willful scheme to evade OFAC sanctions" involving luxury condominiums owned by Russian oligarchs. This last action also involved a settlement with an individual and resolution of criminal charges, serving as a reminder of the potential personal risks that can arise from violating sanctions.

Statutory and Regulatory Changes to Sanctions

As previously reported, 2024 saw the passage of one of the most significant pieces of legislation affecting sanctions in recent years. In April, Biden signed a national security supplemental appropriations bill that included provisions addressing issues ranging from providing aid to Ukraine to forcing the sale of TikTok. Of particular interest from a sanctions compliance and risk standpoint, the bill extended the statute of limitations for commencing enforcement actions for violations of sanctions administered under the International Emergency Economic Powers Act (IEEPA) and the Trading with the Enemy Act (TWEA) from five years to 10 years. These two authorities undergird most of OFAC's sanctions programs, so the change greatly increases exposure to liability for violations. The bill also expanded sanctions authorities regarding Iran as well as persons involved in cyber-related activities threatening the U.S. Furthermore, the bill directed mandatory sanctions against various terrorist organizations and certain drug trafficking and production operations. Specifically targeting Russia, the act made it more difficult for immobilized or blocked Russian sovereign assets to be released. 

On the regulatory front, OFAC issued an interim final rule in May followed by a final rule effective November 7, 2024, requiring electronic filing for certain submissions to OFAC and revising regulations pertaining to reporting requirements for blocked and rejected transactions. The final rule provided three exceptions to the reporting requirement for blocked property that is unblocked or transferred, confirming reports are not required for transfers between blocked accounts within a financial institution or when debiting blocked accounts for normal service charges, when property is unblocked due to a general or specific license (unless the license requires reporting), or when the property is unblocked due to a person's removal from the SDN List. 

In September, OFAC addressed its process for issuing blocked pending investigation (BPI) orders and targeted orders blocking specific property and interests in property. A final rule amending 35 parts of OFAC's regulations explains various approaches OFAC may take to provide notice to affected persons, including public notice via the Federal Register or direct or indirect notice limited to affected parties such as financial institutions. In the latter scenario, OFAC requires recipients of such notices to disclose the blocking order to other affected parties. 

In addition, in December, OFAC published a final rule amending existing general licenses authorizing payments for certain legal services. The amendments replaced the prior reporting requirement with a recordkeeping requirement.

OFAC in the Judicial Spotlight

At the close of its 2023-2024 term, the Supreme Court issued two decisions with significant implications for executive branch power. As previously discussed in depth, Securities & Exchange Commission v. Jarkesy and Loper Bright Enterprises v. Raimondo limited executive authority to impose civil penalties and curtailed the deference given to agency decision-making. 

In Jarkesy, the Supreme Court invalidated the Securities & Exchange Commission's (SEC) statutory authority to impose civil fraud penalties outside of federal court. Congress had granted the SEC the ability to level civil penalties in house, but the Court held that such delegation ran afoul of the Seventh Amendment right to trial in common law suits. In Loper Bright, the Supreme Court overturned the precedent of Chevron deference, which for 40 years affirmed that courts should defer to an agency's reasonable interpretation of an ambiguous statute. 

Neither of these cases directly related to the national security context, but the Court also did not create exceptions for national security or foreign affairs, so the holdings apply to OFAC authority. Thus, for example, the decisions present new opportunities for those seeking to challenge sanctions designations.

Following these decisions, the Fifth Circuit awarded a rare victory to a party challenging an OFAC sanctions determination in Van Loon v. U.S. Department of the Treasury. In August and November of 2022, OFAC imposed blocking sanctions on the immutable smart contracts (computer programs permanently stored on the blockchain that cannot be altered) of Tornado Cash, a virtual currency mixer. But, in November 2024, the Fifth Circuit held that OFAC could not block these smart contracts. The Court reasoned that the smart contracts cannot constitute blockable property because property must be capable of being owned, while smart contracts are unownable because they cannot be altered and one cannot be prevented from using them. This decision brought the growing trend of judicial limitations to executive power, signified by Jarkesy and Loper Bright, to the national security sphere and OFAC. 

Outlook for 2025

Intensified Sanctions in the Middle East. In February, President Trump reinstated a "maximum pressure" campaign on Iran, designed to obstruct Iran's development of nuclear weapons and impair its influence. Citing Iran's destabilizing effect on the Middle East, the campaign calls for increased sanctions, the rescission of waivers, and a diplomatic campaign to isolate Iran. One goal of the campaign is to reduce Iran's oil exports to zero, thereby minimizing the revenue sources that Iran uses to fund its nuclear program and support terror organizations. OFAC has already announced multiple rounds of related designations targeting individuals, entities, and vessels implicated in facilitating the sale and transport of Iranian petroleum, as well as parties involved in UAV procurement; numerous additional designations are likely to follow.

Focus on Foreign Terrorist Organizations. Reversing Biden's policies and returning to the position of his first administration, Trump reinstated the designation of Yemen's Iran-aligned Houthis as a Foreign Terrorist Organization (FTO). OFAC has since narrowed related general licenses, and has designated a variety of individuals, entities, and vessels for providing material support to the Houthis. In addition, Trump directed the designation of eight Latin American organized crime groups as FTOs, given their roles in the drug trade into the U.S. 

While Trump revoked the national emergency concerning the West Bank on his first day back in office and everyone designated under the West Bank-related Sanctions program was removed from the SDN List, this did not affect the status of Hamas, which was and remains designated as an FTO. Given the current administration's focus on FTOs, OFAC will likely persist in targeting Hamas's financial activities and networks throughout 2025.

Expect Increased Pressure on China. The Biden administration's recent designations of parties in China were largely tied to support of Russia and Iran. In its early days, the second Trump administration has also designated parties in China for activities related to Iran, particularly regarding involvement in Iran's oil shipping network. Given the Trump administration's general stance on the threat posed by China, trade between China and Iran, and the enduring China-related (including Hong Kong) sanctions programs created and sustained during the first Trump administration, it will be no surprise if the rest of 2025 brings increased sanctions activity involving China.

Questions Surround Russia and the War in Ukraine. In January 2025, President Trump threatened increased sanctions if Russia does not bring its war against Ukraine to a close, but he also encouraged Ukrainian concessions to Russia to help end the war. While the administration pursues negotiations, Russia-related sanctions activity has so far been fairly limited. Notably, the Trump administration did not extend an energy-related general license released in the final weeks of the Biden administration, instead allowing it to expire. A variety of reports over recent months have indicated that the White House was considering plans for sanctions relief for Russia in an effort to reach a peace deal, while other reports have reiterated the administration's preparedness to increase sanctions pressure if necessary.

Sanctions Against Venezuela to Continue. Continuing the efforts of the Biden administration, the Trump administration has increased pressure on Venezuelan leader Maduro to effectuate electoral reforms. In February 2025, Trump revoked Chevron's license to operate in and export oil from Venezuela, requiring the company to wind down in-country joint ventures. The administration has also threatened additional sanctions tied to achieving its immigration goals.

Reversion Regarding Cuba. While 2024 saw eased sanctions concerning Cuba, as discussed here, Trump has already returned to the stance taken toward Cuba during his first term. Within days of being sworn in as Secretary of State, Marco Rubio announced the restoration of "a Tough U.S.-Cuba Policy," including re-creation of the Cuba Restricted List. 

The Future of Multilateral Cooperation. In a demonstration of multilateral cooperation in the final days of the Biden administration, the U.S. and the U.K. formalized their collaboration on economic sanctions enforcement with a Memorandum of Understanding (MoU) that emphasized both nations' commitment to work closely to enforce sanctions and address shared foreign policy objectives. However, shortly after Trump took office, the U.K. and the EU issued new sanctions against Russia — without corresponding U.S. action — based on the ongoing war in Ukraine. The extent to which the Trump administration will pursue multilateral cooperation on sanctions is currently debatable, but it has acknowledged cooperation will be necessary to achieve some of its most significant goals, such as countering Iran.

For more information, please contact:

Timothy P. O'Toole, totoole@milchev.com, 202-626-5552

Melissa Burgess, mburgess@milchev.com, 202-626-5914

Collmann Griffin, cgriffin@milchev.com, 202-626-5836 

Caroline J. Watson, cwatson@milchev.com, 202-626-6083

Annie Cho, acho@milchev.com, 202-626-1570

Peter Kentz, pkentz@milchev.com, 202-626-5891

Rebecca Tweedie, rtweedie@milchev.com, 202-626-1487

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¹Hours before publication, President Trump announced his intent to lift sanctions on Syria. Details were not immediately available.

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