Former Lebanese Business Owner Secures Sanctions Removal After Suing OFAC
The Office of Foreign Assets Control last week removed a former Lebanon-based small business owner from its Specially Designated Nationals List after he sued the Treasury Department over his designation in December, arguing that OFAC unfairly delayed a decision on his delisting request.
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Fadi Hussein Serhan, now a retired Lebanese citizen, dismissed his complaint on April 7 after the two parties “reached a settlement agreement” over the issue. OFAC officially removed Serhan and his former company, Vatech SARL, from the SDN List on May 15.
Serhan was originally designated in 2015 after OFAC said he provided services to the terrorist group Hezbollah. OFAC said he used Vatech, his Lebanese audio-visual equipment “small retail shop,” to sell equipment to Al Manar TV, a broadcast network allegedly affiliated with Hezbollah, Serhan’s complaint said.
The complaint, filed in the U.S. District Court for the District of Columbia, said Serhan took “substantial remedial actions” after his designation, including dissolving Vatech, giving OFAC the records of sales made by Vatech to Al Manar TV, ending his business relationship with Al Manar TV and “retiring from business altogether.” Serhan did this to “conform his conduct to U.S. sanctions policy objectives and to change the circumstances that gave rise to his designation.”
But OFAC still denied “multiple requests” from Serhan to be removed from the SDN List, the complaint said.
The agency eventually rescinded Serhan’s designation in 2019 but re-sanctioned him under different authorities, including the Hizballah International Financing Prevention Amendments Act of 2018, saying he was “assisting in, sponsoring, or providing financial, material, or technological support for, or financial or other services to or in support of Al Manar,” the complaint said.
OFAC also sent Serhan a summary of its basis for sanctioning him, saying that Serhan “voluntarily disclosed” to OFAC that he sold items to Al Manar TV, according to the complaint. Serhan’s sales records, which he gave to OFAC, showed he sold hundreds of thousands of dollars worth of equipment to the TV station between January 2009 and April 2016.
Although Serhan argued “he did not know or have reason to know” that Al Manar TV was subject to sanctions, OFAC said “it was unreasonable for him not to have known, especially since AL-MANAR had appeared on the SDN List since 2006.”
Serhan in 2020 submitted another “petition for administrative reconsideration” to OFAC seeking removal from the sanctions list, saying there had been a “change in circumstances underlying” his designation. OFAC denied the petition, saying “the evidence in the record does not establish that [Serhan] will not continue to provide support to Al Manar TV,” the complaint said.
In July 2023, Serhan said he submitted another petition to OFAC in which he committed to paying $18,958.06 -- “the total amount received by Vatech SARL from Al Manar following his initial November 5, 2015 designation by OFAC" -- to a charity accepted by OFAC. He also said he would provide “an expert affidavit that any equipment sold by Vatech SARL to Al Manar should no longer be usable or operable,” give OFAC “documentation on an ongoing basis” to prove he’s complying with U.S. sanctions, provide explanations for his bank deposits greater than $1,000, and more.
The complaint said OFAC never made a decision on Serhan’s petition despite telling Serhan multiple times over the course of the next year that an “adjudication was imminent.”
OFAC’s “failure to adjudicate” Serhan’s petition “has caused substantial harm to Plaintiff personally, professionally, and financially, tarnishing his reputation and upending his ability to conduct basic transactions to support his livelihood,” the complaint said. The agency’s allegation that Serhan was connected to Hezbollah through Al Manar TV “has resulted in the loss of commercial partnerships and business relationships,” adding that his “ongoing suffering is a direct result" of Treasury's "failure to adjudicate" Serhan's delisting petition.
Treasury didn’t respond to a request for comment. In its February response to Serhan’s complaint, the agency denied multiple claims made by Serhan, including that the Lebanese citizen “took substantial remedial actions” after his initial designation.” The agency also denied that it “unreasonably” delayed a decision on his delisting petition.