The Office of Foreign Assets Control (OFAC) issued an interim final rule (IFR) on 10 May 2024 (FR Doc 2024-10033, 89 FR) amending the Reporting, Procedures and Penalties Regulations (RPPR) at 31 CFR Part 501. The IFR overhauls OFAC's reporting framework by requiring electronic submission of certain reports through the OFAC Reporting System (ORS), expanding the rejected-transaction reporting obligation to all U.S. persons (not only U.S. financial institutions), modifying blocked-property reporting procedures, updating procedures for petitions for administrative reconsideration and property-blocked-in-error requests, and revising FOIA-availability provisions. The IFR took effect on 8 August 2024 and was subsequently finalised — with three new exceptions to the blocked-property reporting requirement — by the 8 October 2024 final rule (FR Doc 2024-23217, effective 7 November 2024).

Analyst notesShow

Mechanism

The May 2024 IFR is the parent overhaul instrument for OFAC's reporting framework at 31 CFR Part 501. Key structural changes:

Electronic-filing default through ORS. Reports of blocked

property and rejected transactions must now be submitted via the OFAC Reporting System (ORS), replacing the prior paper/email practice. This creates a structured-data trail OFAC relies on for civil enforcement and pattern analysis.

Rejection-reporting expansion to all U.S. persons. Previously

the rejected-transaction reporting obligation fell only on U.S. financial institutions; the IFR extends it to all U.S. persons (including non-bank intermediaries, virtual-currency platforms, payments processors, and corporates handling rejected cross-border transactions touching sanctioned parties).

Blocked-property reporting changes. Updates who must report

blocked property, what must be reported, and the modalities of reporting. The IFR's over-broad initial draft drew industry comment that even routine OFAC-licensed unblockings would require separate reports; the October 2024 final rule subsequently added three exceptions to relieve this duplication.

Procedural updates to reconsideration and unblocking petitions.

Modifies the procedures for requests relating to property blocked in error and clarifies the channel for petitions for administrative reconsideration to seek removal from the SDN List or other OFAC- maintained lists.

FOIA-availability provisions. Updates RPPR with respect to

availability of certain categories of OFAC records under the Freedom of Information Act.

The IFR took effect 8 August 2024 (90 days after Federal Register publication). The 8 October 2024 final rule (FR Doc 2024-23217) finalised the IFR's bulk text while adding three blocked-property reporting exceptions and issuing FAQ 1196 with operational guidance; the final rule itself took effect 7 November 2024. A separate but contemporaneous 13 September 2024 IFR (FR Doc 2024-20674) extended RPPR recordkeeping from 5 to 10 years to align with the 24 April 2024 IEEPA/TWEA statute-of-limitations doubling, and that recordkeeping IFR was finalised on 21 March 2025.

Downstream implications

**Compliance-program redesign across all U.S. persons handling

cross-border transactions.** The expansion of rejection reporting beyond U.S. financial institutions forces non-bank corporates, virtual-currency platforms, payments processors, fintechs, and cross-border consumer-tech distributors to build or extend sanctions-screening, decisioning, and ORS-submission workflows.

Structured-data trail strengthens OFAC enforcement posture.

ORS submission creates machine-readable records of blocked-property and rejection events that feed OFAC's analytic and enforcement pipelines. In combination with the parallel 10-year recordkeeping extension (Sept 2024 IFR / March 2025 final rule) and the doubled statute of limitations (April 2024 IEEPA/TWEA amendment), the full 2024 package materially extends OFAC's enforcement window.

**Compliance-burden delta partially relieved by October 2024 final

rule.** Industry pushback on over-broad blocked-property reporting was acknowledged through three exceptions in the final rule; net-net the IFR + final rule package raises compliance-build costs but narrows the routine-reporting tail.