Specifically, OFAC designated Umar al-Kubaysi (al-Kubaysi) and his company, Al-Kawthar Money Exchange (Al-Kawthar), building upon OFAC’s December 2016 actions, which marked the first designations of ISIS-linked money services businesses. Al-Kubaysi and Al-Kawthar play an important role in ISIS’s financial operations by moving money both within and outside of ISIS-controlled territory. OFAC designated al-Kubaysi and Al-Kawthar in coordination with the Government of Iraq, which has also taken steps under its domestic authorities to bar this entity from the Iraqi financial system and freeze any assets al-Kubaysi and Al-Kawthar may have subject to Iraq’s jurisdiction. Al-Kawthar was designated for being owned or controlled by al-Kubaysi. As of mid-2016, al-Kubaysi owned Al-Kawthar, which was located in ISIS-controlled territory. Between late 2015 and early 2016, Al-Kawthar Money Exchange reconciled financial transfers worth approximately $2.5 million with another Iraq-based money exchange company that was associated with ISIS financial facilitators. Al-Kawthar sent transfers using a Gulf-based company, which is co-owned by two suspected ISIS facilitators. In spring 2014, al-Kubaysi, as the owner of Al-Kawthar, reconciled deposits and withdrawals with the Hanifa Currency Exchange, which is owned by ISIS financial facilitator Fawaz Muhammad Jubayr al-Rawi. OFAC designated both Fawaz Muhammad Jubayr al-Rawi and the Hanifa Currency Exchange branch in Albu Kamal as Specially Designated Global Terrorists pursuant to E.O. 13224 on December 13, 2016. In 2013, Al-Kawthar was involved in facilitating money transfers for AQI.
On June 6, 2003, OFAC issued the Global Terrorism Sanctions Regulations, 31 CFR part 594 (68 FR 34196, June 6, 2003 (“the Regulations”), to implement Executive Order (E.O.) 13224 of September 23, 2001, “Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten To Commit, or Support Terrorism” (66 FR 49079, September 25, 2001). OFAC has amended the Regulations on several occasions.
On September 9, 2019, the President, invoking the authority of, inter alia, the International Emergency Economic Powers Act (50 U.S.C. 1701–1706) (IEEPA) and the United Nations Participation Act (22 U.S.C. 287c) (UNPA), issued E.O. 13886, “Modernizing Sanctions To Combat Terrorism” (84 FR 48041, September 12, 2019), effective September 10, 2019. In E.O. 13886, the President, finding it necessary to consolidate and enhance sanctions to combat acts of terrorism and threats of terrorism by foreign terrorists, terminated the national emergency declared in E.O. 12947 of January 23, 1995, “Prohibiting Transactions With Terrorists Who Threaten To Disrupt the Middle East Peace Process” (60 FR 5079, January 25, 1995), and revoked E.O. 12947, as amended by E.O. 13099 of August 20, 1998, “Prohibiting Transactions With Terrorists Who Threaten To Disrupt the Middle East Peace Process” (63 FR 45167, August 25, 1998). In addition, the President amended E.O. 13224, in order to build upon initial steps taken in E.O. 12947, to further strengthen and consolidate sanctions to combat the continuing threat posed by international terrorism, and in order to take additional steps to deal with the national emergency declared in E.O. 13224, with respect to the continuing and immediate threat of grave acts of terrorism and threats of terrorism committed by foreign terrorists, which include acts of terrorism that threaten the Middle East peace process.
Section 1 of E.O. 13886 replaces in its entirety section 1 of E.O. 13224, which had been amended by a number of prior Executive orders (E.O. 13224, as amended by all such authorities, is referred to herein as “amended E.O. 13224”), but does not amend the Annex to E.O. 13224, which was previously amended by E.O. 13268 of July 2, 2002, “Termination of Emergency With Respect to the Taliban and Amendment of Executive Order 13224 of September 23, 2001” (67 FR 44751, July 3, 2002) (“amended Annex to E.O. 13224”).
