The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) has reached an agreement with IMG Academy LLC for $1.72 million. The agreement resolves allegations of repeated transactions with individuals sanctioned by the OFAC due to their connections with a Mexican drug cartel.
Elite Sports Academy Faces Financial Penalty
According to the OFAC, IMG Academy engaged in repeated transactions with sanctioned individuals for five consecutive years. These transactions involved annual tuition and enrollment agreements designed to support the attendance of the individuals’ children.
Between 2018 and 2022, IMG Academy entered into annual contracts with two individuals designated as Specially Designated Nationals (SDN) due to their support of a Mexican narcotics trafficking organization. The OFAC cited a failure to comply with sanctions requirements, specifically a lack of sanctions verification despite receiving complete name information that matched entries on the SDN List.
Implications and Future Steps
The OFAC stated the purpose of this action is to encourage institutions to implement effective, risk-based internal controls to prevent sanctions violations and to prevent illicit actors from benefiting within the United States. The $1.72 million agreement amount reflects the OFAC’s consideration of various factors.
IMG Academy is recognized as a high-performance sports training and educational center, having trained professional athletes, world champions, and Olympic medalists.
Frequently Asked Questions
What prompted the OFAC to grab action against IMG Academy?
The OFAC took action due to IMG Academy’s repeated transactions with individuals sanctioned for their ties to a Mexican drug cartel, spanning five consecutive years.
What type of agreements were made between IMG Academy and the sanctioned individuals?
IMG Academy signed annual tuition and enrollment agreements to support the attendance of the two sanctioned individuals’ children.
What did the OFAC cite as a key failure by IMG Academy?
The OFAC cited IMG Academy’s failure to comply with sanctions requirements, including a lack of sanctions verification despite receiving complete name information that matched entries on the SDN List.
As institutions increasingly operate on a global scale, how might this case influence compliance procedures in similar educational settings?
