The U.S. Treasury's Office of Foreign Assets Control (OFAC) implemented a new rule in March 2025, extending the mandatory recordkeeping period for transactions subject to its regulations. Companies are now required to retain these records for ten years, a significant increase from the previous five-year requirement. This change, which followed an interim rule published in September 2024, aims to enhance the government's ability to investigate and enforce sanctions compliance over a longer timeframe.
For freight forwarders and logistics companies, this extension means a substantial increase in the administrative and compliance workload. They must ensure their internal systems and processes are capable of securely storing and retrieving detailed transaction data for a full decade. This includes all documentation related to cargo, parties involved, financial transactions, and any due diligence performed to verify compliance with OFAC sanctions. Failure to maintain adequate records could lead to severe penalties, making a robust audit trail crucial for mitigating risk.
This regulatory update necessitates a review of current record management policies and IT infrastructure to ensure they meet the new ten-year standard. Forwarders should also consider staff training on the updated requirements and the importance of meticulous recordkeeping to avoid potential compliance breaches.
