Audit Report

OIG-19-033

ANTI-MONEY LAUNDERING/TERRORIST FINANCING

Audit of the Office of Terrorism and Financial 

Intelligence’s Report on Section 241 of the 

Countering America’s Adversaries Through 

Sanctions Act

February 22, 2019

Office of Inspector General

Department of the Treasury
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i 

Contents

Audit Report

Background....................................................................................................... 2

Office of Terrorism and Financial Intelligence ................................ 2

Countering America’s Adversaries Through Sanctions Act............. 3

CAATSA Section 241 Reporting................................................... 5

Audit Results..................................................................................................... 7

CAATSA Section 241 Report Complies With Requirements............ 7

Finding 1 Response to Section 241(a)(3) Lacks Detailed Analysis ................. 7

Recommendation....................................................................... 11

Appendices

Appendix 1: Objective, Scope, and Methodology .............................................. 12

Appendix 2: CAATSA Sections Delegated to Treasury...................................... 15

Appendix 3: Management Response................................................................. 17

Appendix 4: Major Contributors to This Report ................................................. 20

Appendix 5: Report Distribution ....................................................................... 21

Abbreviations

CAATSA Countering America’s Adversaries Through Sanctions Act

IA Office of International Affairs

ODNI Office of the Director of National Intelligence

OFAC Office of Foreign Assets Control

OIA Office of Intelligence and Analysis

OIG Office of Inspector General

SDN Specially Designated Nationals and Blocked Persons

State Department of State

TFFC Office of Terrorist Financing and Financial Crimes

TFI Office of Terrorism and Financial Intelligence

Treasury Department of the Treasury
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Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 1 

 

February 22, 2019 

Sigal Mandelker

Under Secretary

Terrorism and Financial Intelligence

This report presents results from an audit of the Department of the 

Treasury (Treasury) Office of Terrorism and Financial 

Intelligence (TFI). This is the first of two audit reports related to 

TFI’s compliance with Title 2, Countering Russian Influence in 

Europe and Eurasia Act of 2017, of the Countering America’s 

Adversaries Through Sanctions Act (CAATSA).1 The objective of 

this audit was to determine whether TFI complied with reporting 

requirements stipulated in CAATSA section 241, Report on 

Oligarchs and Parastatal Entities of the Russian Federation. We plan 

to issue a second audit report assessing whether TFI’s

Ukraine-/Russia-related sanctions program complies with applicable 

laws and regulations, including the CAATSA Title 2 sections 

summarized in appendix 2.

In brief, TFI’s report to Congress dated January 29, 2018, 

complies with the requirements listed in CAATSA section 241, but 

the response to one of the sections lacks detailed analysis. 

Specifically, TFI’s response to section 241(a)(3), on the exposure 

of key economic sectors of the United States to Russian politically 

exposed persons and parastatal entities,2 could be more 

informative. The completion of the CAATSA section 241 report 

represents a great undertaking among members of multiple 

agencies including Treasury, represented by TFI. However, TFI’s 

prioritization of four of the five sections and a miscommunication 

1 Public Law (P.L.) 115-44, Countering America’s Adversaries Through Sanctions Act (August 2, 

2017) 2 The term “parastatal entities” refers to entities which the government owns or controls, wholly or in 

part. For the purposes of the unclassified CAATSA section 241 report to Congress, Treasury defined 

the term “parastatals” as companies in which Russian Federation ownership is at least 25 percent 

and that had 2016 revenues of approximately $2 billion or more. 
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 2 

between TFI personnel, led to a gap in project management over 

section 241(a)(3) and ultimately left little time for Treasury 

employees with requisite knowledge and experience to provide a

more detailed analysis. 

Accordingly, we recommend that the Under Secretary for TFI 

ensures TFI, in responding to new legislation and ad hoc requests 

from stakeholders requiring coordination among multiple 

components, assigns a project manager. 

We conducted fieldwork for this report during March through 

July 2018. Appendix 1 provides a more detailed description of our 

audit objective, scope, and methodology.

In a written response, management agreed with the finding that 

section 241(a)(3) met all statutory requirements and concurred 

with the recommendation that project management should 

minimize miscommunications that are likely to arise when 

implementing a complex and novel statutory scheme. Accordingly, 

TFI will continue to assign, as appropriate, an employee with 

sufficient stature and authority to be responsible for overseeing and 

coordinating complex, multifaceted reports, such as section 241. 

TFI affirmed its commitment to complying fully with Congressional 

reporting provisions and noted that given the increasing reliance 

upon TFI’s economic tools and authorities across this and other 

programs as well as the increasing volume of reporting 

requirements, TFI is repeatedly in the position of making 

judgements with respect to how they allocate their resources.

Management’s response is included in its entirety in appendix 3. 

Background 

Office of Terrorism and Financial Intelligence

The Consolidated Appropriations Act of 20053 established TFI, 

headed by an Under Secretary to whom the Office of Intelligence 

and Analysis (OIA), Financial Crimes Enforcement Network, Office 

of Terrorist Financing and Financial Crimes (TFFC), Office of 

 

3 P.L. 108-447, Consolidated Appropriations Act, 2005 (December 8, 2004) 
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 3 

Foreign Assets Control (OFAC), and Treasury Executive Office for 

Asset Forfeiture, all report. OIA is responsible for the receipt, 

analysis, collation, and dissemination of foreign intelligence and 

foreign counterintelligence information related to Treasury 

operations. OIA also serves as liaison to the intelligence community 

and represents Treasury in various intelligence-related 

activities. TFFC is the policy development and outreach office for 

TFI and works with federal agencies to develop and promote the 

United States’ position in both international and domestic forums 

related to money laundering and illicit financing. 

Countering America’s Adversaries Through Sanctions Act

CAATSA united several existing bills directing the President to 

impose sanctions related to Iran, the Russian Federation, North 

Korea, and other cyber and terrorism-related programs. Title 2 of 

CAATSA, Countering Russian Influence in Europe and Eurasia Act 

of 2017, encourages the President to uphold and seek unity with 

European and other key partners on sanctions implemented against 

the Russian Federation, engage partner governments to close 

loopholes in multilateral and unilateral restrictive measures against 

the Russian Federation, and increase efforts to enforce compliance 

with sanctions in response to the crisis in Ukraine, cyber intrusions 

and attacks, and human rights violators in the Russian Federation. 

It also codified existing executive orders, imposes various new 

mandatory sanctions against the Russian Federation, and requires 

the Secretary of the Treasury to submit to Congress three reports 

related to the Russian Federation.4 CAATSA section 241 requires 

the Secretary of the Treasury, in consultation with the Secretary of 

State and the Director of National Intelligence, to submit to 

Congress within 180 days of CAATSA passage a detailed report on

the following.

 

4 CAATSA Title 2 requires the Secretary of the Treasury to submit reports pursuant to sections 241, 

Report on Oligarchs and Parastatal Entities of the Russian Federation, 242, Report on Effects of 

Expanding Sanctions to Include Sovereign Debt and Derivative Products, and 243, Report on Illicit 

Finance Relating to the Russian Federation. This audit report only addresses section 241. See 

appendix 2 for more information regarding sections of CAATSA Title 2. 
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 4 

1. Senior foreign political figures5 and oligarchs6 in the Russian 

Federation, including: a) identification of the most significant 

senior foreign political figures and oligarchs as determined by 

their closeness to the Russian regime and their net worth, 

b) assessment of the relationship between the individuals and 

President Putin or other members of the Russian ruling elite, 

c) identification of any indices of corruption with respect to 

those individuals, d) the estimated net worth and known sources 

of income of those individuals and their family members, and 

e) identification of the non-Russian business affiliations of those 

individuals (section 241(a)(1)) 

2. Russian parastatal entities, including an assessment of: a) the 

emergence of Russian parastatal entities and their role in the 

economy of the Russian Federation, b) the leadership structures 

and beneficial ownership of those entities, and c) the scope of 

the non-Russian business affiliations of those entities

(section 241(a)(2))

3. The exposure of key economic sectors of the United States to 

Russian politically exposed persons and parastatals, including at 

least the banking, securities, insurance, and real estate sectors

(section 241(a)(3))

4. The likely effects of imposing debt and equity restrictions on 

Russian parastatal entities and of adding Russian parastatals to 

the Specifically Designated Nationals and Blocked 

Persons (SDN)list7

 (section 241(a)(4)) 

5. The potential impacts of imposing secondary sanctions on

Russian oligarchs, Russian state-owned enterprises, and Russian 

parastatal entities (section 241(a)(5))

 

5 For the purposes of the unclassified CAATSA section 241 report to Congress, the term “senior 

foreign political figures” are 1) senior members of the Russian Presidential Administration; 

2) members of the Russian Cabinet, Cabinet-rank ministers, and heads of other major executive 

agencies; and 3) other senior political leaders (including the leadership of the State Duma and 

Federation Council), other members of the Russian Security Council, and senior executives at 

state-owned enterprises. 6 For the purposes of the unclassified CAATSA section 241 report to Congress, the term “oligarch” 

refers to individuals who, according to reliable public sources, have an estimated net worth of 

$1 billion or more. 7 OFAC’s SDN list shows designated individuals and entities in connection with activity involving

sanctioned countries or individuals, groups, and entities designated under sanctions programs that 

are not country-specific, such as terrorists and narcotics traffickers. 
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 5 

CAATSA Section 241 Reporting

The Secretary of the Treasury delegated the responsibility of

drafting the section 241 report, to the Under Secretary for TFI, 

who held meetings with TFI components to discuss the reporting 

requirements. Participants agreed that two of OIA’s components 

would respond to the majority of the section 241 requirements and 

TFFC would assist in coordinating and packaging the report.

Treasury employees told us the individuals who drafted the section 

241 report were also involved in discharging other national security 

missions of TFI. 

During September and October 2017, one OIA component actively 

collaborated with the Office of the Director of National 

Intelligence (ODNI) and other agencies to plan, scope, and collect 

information for section 241(a)(1), the Russian oligarchs and senior 

political officials lists. Throughout November and December 2017, 

OIA and ODNI drafted the report section on 241(a)(1). During

November and December 2017, the second OIA component

collected information and drafted the sections on 241(a)(2), (a)(4), 

and (a)(5). Working drafts were provided to TFFC. In January 

2018, TFFC drafted section 241(a)(3). 

Section 241(b) required that an unclassified report be submitted, 

but added that it may contain a classified annex. Because of this 

requirement, Treasury officials had to decide what to include in the 

unclassified report since the majority of the information developed 

in response to section 241 of CAATSA was deemed classified. 

TFFC and OIA briefed the Under Secretary for TFI and the 

Secretary of the Treasury on the report contents and recommended 

what information be disclosed in an unclassified report. TFI officials 

told us Treasury leadership considered two potential methodologies 

for the unclassified report to Congress. The first methodology was 

to provide a list of oligarchs and senior political figures, mirroring

the classified annex, that would list the Russian malign actors as 

described in greater detail in the classified report. Treasury officials 

told us this approach risked telegraphing to the world, as well as 

Russian oligarchs and senior political figures, potential targets for 

future sanctions. Because section 241 only required Treasury to 

develop a report, and not to issue sanctions, the threshold for 

inclusion in this report alone would not meet the legal threshold for 
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 6 

sanctionable activity or create the legal ramifications of a sanction, 

most notably, blocking assets. Therefore, this methodology also 

presented the risk of asset flight, offering individuals on the list an

opportunity to move and conceal assets, potentially reducing the 

impact of future sanctions. With this methodology, the unclassified 

report would address the section 241(b) requirement and the report 

would mirror the classified list of oligarchs and senior political 

figures with the classified list providing more details and addressing

the remaining requirements in section 241.

A second methodology for the unclassified report was to draw on 

public sources, such as the Forbes’ ranking of the “200 richest 

businessmen in Russia 2017,” to assemble a list of wealthy

Russians and senior political figures. This methodology would 

further distinguish this from a sanctions list and make clear that 

inclusion on the list does not imply Treasury is considering future 

action against these individuals. Department of State (State) 

officials told us the risk in using this approach was that the public 

might wrongly identify wealthy individuals on the list, with no 

connection to the Russian regime, as malign actors. In addition, the 

classified information would not be available to the public, which 

could lead to scrutiny over the efforts of the report drafters. With

this methodology, the classified annex would answer most section 

241 reporting requirements and the unclassified report would serve 

to address section 241(b). 

Treasury opted for the second approach and determined that the 

unclassified report to Congress would follow the public-source 

methodology to reduce the possibility for asset flight. By the 

deadline of January 29, 2018, Treasury submitted the final report 

to the appropriate congressional committees along with an 

explanation of the methodology.

8

 

8 CAATSA section 241(c) defines the term ‘‘appropriate congressional committees’’ as (A) the 

Committee on Banking, Housing, and Urban Affairs, the Committee on Foreign Relations, and the 

Committee on Finance of the Senate; and (B) the Committee on Foreign Affairs, the Committee on 

Financial Services, and the Committee on Ways and Means of the House of Representatives.
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 7 

Audit Results

TFI’s report pursuant to section 241 complies with CAATSA

requirements, but the response to section 241(a)(3) lacks detailed 

analysis. 

CAATSA Section 241 Report Complies With 

Requirements

In accordance with CAATSA section 241, the Secretary of the 

Treasury, in consultation with the Secretary of State and the 

Director of National Intelligence, met the 180 day deadline for 

submitting the unclassified report and classified annex to the 

appropriate congressional committees. We determined that the 

unclassified report complies with section 241(b) and the classified 

annex complies with reporting requirements specified in sections 

241(a)(1) through (a)(5). The unclassified report responded only to 

section 241(b), which required that a report be submitted in an 

unclassified form. This report included a list of Russian oligarchs 

and senior political officials identified through public sources. The 

classified annex provided responses to sections 241(a)(1) through 

(a)(5) requirements, and section 241(a)(3) was the only part of the 

response that lacked detailed analysis. Our review of 

correspondence, drafts, and briefing documents showed evidence 

of substantial coordination and consultation with ODNI and State

officials, as required. Also, Treasury officials told us section 241 

(a)(1) took over 2,500 hours for interagency components to draft. 

Given the extensive collaboration among interagency components, 

the in-depth analysis conducted, and the short reporting period of 

six months, TFI, in consultation with ODNI and State, produced an 

informative report, except for section 241(a)(3). 

Finding 1 Response to Section 241(a)(3) Lacks Detailed Analysis

Although Treasury provided a response to section 241(a)(3) that 

meets statutory requirements, its response could have been more 

detailed and informative. TFI’s prioritization of the other four 

sections and a miscommunication between TFI personnel led to a 

gap in project management over section 241(a)(3) and ultimately 

left little time for Treasury employees with requisite knowledge and 

experience to provide a more detailed analysis. 
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 8 

Project management is defined as the application of knowledge, 

skills, tools, and techniques to project activities to meet project 

requirements. Project management incorporates processes such as 

initiating, planning, executing, controlling, and closing to ensure 

that the various elements of the project are properly coordinated 

and completed on time. Proper coordination of a project includes 

the development of a project plan and proper execution of that 

plan. Timely completion of a project depends on activity definition, 

schedule development, and schedule control. A project manager is 

responsible for all aspects of the project, including 1) developing 

the project management plan; 2) keeping the project on schedule 

and within budget; 3) identifying, monitoring, and responding to 

risk; and 4) providing accurate and timely reporting of project 

metrics. The project manager is the lead person responsible for 

communicating with all stakeholders, particularly the project 

sponsor and project team. 

According to the Government Accountability Office’s Standards for 

Internal Control in the Federal Government,9 management is 

responsible for developing an organizational structure with an 

understanding of the overall responsibilities. It assigns these 

responsibilities to discrete units to enable the organization to 

operate efficiently and effectively, comply with applicable laws and 

regulations, and reliably report quality information. As part of 

establishing an organizational structure, management must 

consider the entity’s overall responsibilities to external stakeholders 

and also how units interact to fulfill their individual responsibilities. 

Management is also responsible for using quality information—

meaning appropriate, current, complete, accurate, accessible, and 

timely—to achieve the entity’s objectives. 

CAATSA section 241(a)(3) requires the Secretary of the Treasury

to submit an analysis on the exposure of key economic sectors of 

the United States to Russian politically exposed persons and 

parastatal entities, including, at a minimum, the banking, securities, 

insurance, and real estate sectors. Treasury’s response to this 

section consists of five sentences, including one sentence for each 

of the four economic sectors specified in the act. Although each 

 

9 The Government Accountability Office’s Standards for Internal Control in the Federal Government

(September 2014), also known as the Green Book and issued by the Comptroller General of the 

United States, provides the overall framework for establishing and maintaining an effective internal 

control system.
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 9 

sentence makes reference to a specified economic sector, the 

analysis is lacking. The response offers qualitative terms with no 

defined thresholds and only vague qualifications about the ability to 

estimate possible effects. Unlike other sections of the report, draft 

and final versions of section 241(a)(3) do not contain any citations

to support the information and analysis presented. 

OIA was responsible for drafting most of the responses to section

241, however it is unclear what group within TFI was responsible 

for the response to section 241(a)(3). Assignments of responsibility 

were not documented and we received conflicting information 

about the responsibility for section 241(a)(3). We were told that 

OIA personnel determined that OIA could not respond to 241(a)(3), 

as officials were cautious in exercising their authorities to collect 

information on U.S. persons.

10 Additionally, an OIA employee told 

us that OIA analysts do not have the expertise to complete a 

domestic economic analysis as their analytical focus, in their 

normal course of business, is outside of the United States. OIA 

employees and analysts told us that they raised this concern in 

meetings with TFFC and the Office of International Affairs (IA) 

early in the planning process, but they were unaware if or how this 

issue was being addressed. On December 22, 2017, OIA emailed a 

draft of its completed sections to the TFFC employee responsible 

for coordinating Treasury’s response. In the attached draft, OIA left 

a placeholder for section 241(a)(3) and, in the body of the email

addressed to the TFFC employee, identified OIA’s inability to 

respond to the area as an open item. According to the TFFC 

employee, other sections of the report received higher priority 

during the drafting process, and the issue of OIA’s inability to draft 

the section escaped his attention until it was raised one week 

before the report was due. However, the employee acknowledged 

that the issue may have been raised earlier. 

Neither the TFFC employee nor OIA formally requested assistance 

from other Treasury offices with economic expertise, such as IA or 

the Office of Domestic Finance, to address section 241(a)(3) until 

January 23, 2018, less than a week before the report was due. An 

 

10 Executive Order 12333 section 2.3 governs the collection of U.S. person information by intelligence 

community members. Pursuant to that Executive Order, OIA may intentionally collect (overtly or 

through publicly available sources) information about a U.S. person if the information sought is 

reasonably believed to be necessary for an authorized mission or OIA function, and if the information 

falls within one of the section 2.3 categories. 
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 10

IA official told us that IA officials declined to complete the section 

with so little time left in the reporting process but did consult with 

TFFC on how to approach the response. However, OIA and TFFC 

employees told us that during the drafting process they informally 

discussed with IA that completing a response to section 241 (a)(3) 

was an open item. Ultimately, the TFFC employee assisting with 

the report’s coordination, drafted a response to section 241(a)(3) 

on January 27, 2018, two days before the report was due to 

Congress. 

The TFFC employee told us that the section 241(a)(3) response 

contained information compiled from open sources available on the 

Internet and not from any analytical body of work within Treasury. 

Treasury employees with economic expertise identified this section 

as a weak point in the report and told us it could have been more 

detailed. 

We believe the gap in project management that resulted from TFI’s 

prioritization of the other sections and a miscommunication 

between TFI personnel were significant factors in the response to 

section 241(a)(3) lacking detailed analysis. The section 241 

reporting effort involved multiple TFI components and external 

agencies as well as several mid-project changes to component task 

assignments. Effective project planning is critical to control the 

project scope, schedule, quality, and deliverables. Treasury officials 

told us that tasks such as the section 241 report are not 

specifically and formally assigned, and each office understands 

which requirements would be within their purview. While a TFFC 

employee coordinated Treasury’s overall response to section 241, 

each component was responsible for the management and 

completion of their respective sections. No individual was formally 

placed in a lead role for section 241 and given authority to assign 

tasks and coordinate activities or require status updates from 

different work groups. In many interviews with individuals 

responsible for drafting the report, we were told that it is common 

practice for various offices to collaborate on tasks and informally 

volunteer to meet requirements. OIA officials and analysts stated 

that it would have been helpful to have a centralized project 

manager for this report. 

We recognize that time and resource constraints may have been a 

challenge in completing the section 241 report. Nevertheless, in 
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 11

the absence of other informative sources of information it may limit 

policy and decision makers’ understanding of the exposure of key 

economic sectors of the United States to Russian politically 

exposed persons and parastatal entities and may not provide the

stakeholders with sufficient information to make key decisions and 

develop future legislation to help counter aggression by the Russian 

Federation. As such, we believe it is prudent for TFI to complete 

further analysis pursuant to section 241(a)(3) and consider 

submitting the more detailed information to the appropriate 

congressional committees. 

Recommendation

We recommend that the Under Secretary for TFI ensures TFI, in 

responding to new legislation and ad hoc requests from 

stakeholders requiring coordination among multiple components, 

assigns a project manager. 

Management Response

TFI management agrees with the recommendation and will 

continue its practice to assign, where appropriate, an employee 

with sufficient stature and authority to be responsible for 

overseeing and coordinating complex, multifaceted reports.

OIG Comment

Management’s response meets the intent of our recommendation.

* * * * * *

We appreciate the cooperation and courtesies extended to our staff 

during this audit. For the major contributors to this report, see 

appendix 4, and for report distribution, see appendix 5. If you wish 

to discuss the report, please contact me at (202) 927-5400 or 

Greg Sullivan, Audit Director, at (202) 927-5369. 

/s/

Deborah L. Harker

Assistant Inspector General for Audit

Appendices
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 12

Appendix 1: Objective, Scope, and Methodology

Our audit objective was to determine whether the Office of 

Terrorism and Financial Intelligence (TFI) complied with section 241 

of the Countering America’s Adversaries Through Sanctions Act of 

2017 (CAATSA). The audit scope included actions taken by TFI 

from July 1, 2017 through February 28, 2018, to meet the 

requirements of section 241, Report on Oligarchs and Parastatal 

Entities of the Russian Federation. We conducted our fieldwork at 

TFI component offices, the Office of the Director of National 

Intelligence, and U.S. Department of State offices located in 

Washington, D.C. 

To accomplish our objective, we identified the requirements of 

CAATSA section 241 and other laws, regulations, and guidance 

associated with congressional reporting and intelligence activities, 

including: 

• Public Law 115-44, Countering America's Adversaries Through 

Sanctions Act (August 2, 2017)

• GAO-14-704G, Standards for Internal Control in the Federal 

Government (September 2014)

• 31 U.S.C. 311, Office of Intelligence and Analysis

(December 8, 2004)

• 31 U.S.C. 312, Terrorism and Financial Intelligence

(May 29, 2015)

• Executive Order 12333, as amended, United States Intelligence 

Activities (July 30, 2008)

• Intelligence Community Directive 203, Analytic Standards

(January 2, 2015)

• Procedures for U.S. Department of the Treasury Intelligence 

Activities (July 6, 2017)

• Treasury Order 109-01, Authority for Congressional Relations 

Activities (January 13, 1977)

• Treasury Order 113-02, Legislative Procedures (July 25, 1990)

• Project Management Institute, A Guide to the Project 

Management Body of Knowledge, Sixth Edition (2017). 
Appendix 1: Objective, Scope, and Methodology 

Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 13

We reviewed the CAATSA report submitted to Congress and 

assessed compliance with the requirements of section 241. We 

reviewed CAATSA section 241 and determined whether all 

requirements were answered in the submitted report. We also 

considered interpretive definitions for terms in the report that were 

not defined in section 241.

To assess the completeness of the response to section 241 

requirements, we used our professional judgment to determine 

whether the answers provided in the submitted report fully 

addressed the requirements for each subsection and provided 

quality information for both internal and external users per federal 

internal control standards.11 We then corroborated our judgment 

with testimonial and documentary evidence.

We requested and reviewed documentation of the planning, 

drafting, review, and transmittal of the report pursuant to CAATSA

section 241. This included a review of draft iterations and

correspondence, which helped us to build a timeline of coordination 

activities undertaken during report development. 

We interviewed Treasury management and staff involved in 

developing the section 241 CAATSA report, including staff from 

the Office of Terrorist Financing and Financial Crimes, Office of 

Intelligence and Analysis, Office of Foreign Assets Control, Office 

of Legislative Affairs, and Office of International Affairs. Because 

the report required the Secretary of the Treasury to coordinate with 

the Secretary of State and the Director of National Intelligence, we 

also interviewed officials from those agencies. During these 

interviews, we obtained an understanding of the division of 

reporting responsibilities and the coordination process that brought 

all efforts together in the final report. We also sought feedback 

from interviewees on their perceptions of the value, quality, and 

completeness of various report sections.

We performed our fieldwork during March through July 2018. This 

audit was performed concurrently with the Audit of TFI’s 

Ukraine-/Russia-related Sanctions Program. Our conclusions on 

 

11 GAO-14-704G, Standards for Internal Control in the Federal Government (September 2014), Principle 

13, Use of Quality Information 
Appendix 1: Objective, Scope, and Methodology 

Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 14

TFI’s compliance with the remaining Title 2 CAATSA sections will 

be included in a subsequent report.

12

We conducted this performance audit in accordance with generally 

accepted government auditing standards. Those standards require 

that we plan and perform the audit to obtain sufficient, appropriate 

evidence to provide a reasonable basis for our findings and 

conclusions based on our audit objectives. We believe that the 

evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.

 

12 Our overall assessment of TFI’s compliance will include the remaining Title 2 sections of CAATSA, 

as delegated to the Treasury by the President, except sections 242 and 243. See appendix 2 for 

discussion of the sections of CAATSA.
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 15

Appendix 2: CAATSA Sections Delegated to Treasury

On September 29, 2017, the President delegated certain functions 

and authorities under the Countering America’s Adversaries 

Through Sanctions Act (CAATSA) of 2017. Table 1 summarizes, 

by section, those delegated to the Secretary of the Treasury. The 

scope of our second audit report will include all of the sections 

listed in Table 1, except 241–243.

Table 1. CAATSA Authorities and Functions Delegated to the 

Secretary of the Treasury

 

13 The President of the United States delegated the functions and authorities under CAATSA for each 

section to agency heads listed in appendix 2. For Treasury and State, delegation was to the 

Secretary of each agency and for ODNI, delegation was to the Director.

Section Number Section Title

Delegated 

Authority13

216 Congressional Review of Certain 

Actions Relating to Sanctions 

Imposed with Respect to the Russian 

Federation

Department of the

State (State) and 

Department of the 

Treasury

(Treasury)

222(b) Codification of Sanctions Relating to 

the Russian Federation

Treasury in 

consultation with 

State

223 Modification of Implementation of 

Executive Order 13662

Treasury

224(a) and 

(b)(1)

Imposition of Sanctions with Respect 

to Activities of the Russian 

Federation Undermining 

Cybersecurity

Treasury in 

consultation with 

State

226 Imposition of Sanctions with Respect 

to Russian and Other Foreign 

Financial Institutions

Treasury in 

consultation with 

State

227 Mandatory Imposition of Sanctions 

with Respect to Significant 

Corruption in the Russian Federation

Treasury in 

consultation with 

State

228 Mandatory Imposition of Sanctions 

with Respect to Certain Transactions 

with Foreign Sanctions Evaders and 

Serious Human Rights Abusers in the 

Russian Federation

(amended sections 10(a)–(c) and (e) 

and 11(a), (b)(1), (d), and (e) of the 

Support for the Sovereignty, 

Integrity, Democracy, and Economic 

Stability of Ukraine Act of 2014

Treasury in 

consultation with 

State
 

Appendix 2: CAATSA Sections Delegated to Treasury

Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 16

 

14 The section 242 report was submitted by International Affairs, which does not fall under TFI. As our 

audit pertains to TFI’s compliance with applicable laws and regulations, this section is outside of our 

audit scope. 15 The section 243 report is an annual report to be filed through 2021. The first such report was issued 

on August 6, 2018. Because our overall assessment of TFI’s compliance with applicable laws and 

regulations includes actions taken from July 1, 2017 through April 20, 2018, this report is outside of 

our audit scope.

229 (b) Notifications to Congress Under 

Ukraine Freedom Support Act of 

2014

Treasury in 

consultation with 

State

230 Standards for Termination of Certain 

Sanctions with Respect to the 

Russian Federation

Treasury in 

consultation with 

State

233 (a) Sanctions with Respect to 

Investment in or Facilitation of 

Privatization of State-owned Assets 

by the Russian Federation

Treasury in 

consultation with 

State

234 (b)(1) Sanctions with Respect to the 

Transfer of Arms and Related 

Materiel to Syria

Treasury in 

consultation with 

State

241 Report on Oligarchs and Parastatal 

Entities of the Russian Federation

Treasury in 

consultation with 

the Office of the 

Director of 

National 

Intelligence (ODNI) 

and State

24214 Report on Effects of Expanding 

Sanctions to Include Sovereign Debt 

and Derivative Products

Treasury in 

consultation with 

ODNI and State

24315 Report on Illicit Finance Relating to 

the Russian Federation

Treasury in 

consultation with 

ODNI and State

Sources: Delegation of Certain Functions and Authorities under the Countering 

America’s Adversaries Through Sanctions Act of 2017, the Ukraine Freedom Support 

Act of 2014, and the Support for the Sovereignty and Integrity, Democracy, and 

Economic Stability of Ukraine Act of 2014 and OFAC Cheat Sheet—Russian 

Sanctions-Related Authorities in CAATSA
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 17

Appendix 3: Management Response 
Appendix 3: Management Response

Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 18
Appendix 3: Management Response

Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 19
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 20

Appendix 4: Major Contributors to This Report

Gregory Sullivan, Audit Director

Eileen Kao, Audit Manager

Justin Walker, Auditor-in-charge

John Snyder, Auditor

David Hash, Referencer
Audit of the Office of Terrorism and Financial Intelligence’s Report on 

Section 241 of the Countering America’s Adversaries Through Sanctions 

Act (OIG-19-033) 21

Appendix 5: Report Distribution

Department of the Treasury

Deputy Secretary

Office of Legislative Affairs

Office of Strategic Planning and Performance Improvement

Office of the Deputy Chief Financial Officer, Risk and Control 

Group

Office of Terrorism and Financial Intelligence

Assistant Secretary for Terrorist Financing and Financial Crimes

Assistant Secretary for Intelligence and Analysis

Office of Management and Budget

OIG Budget Examiner

United States Senate

Committee on Appropriations

Committee on Banking, Housing, and Urban Affairs

Committee on Foreign Relations

Committee on Finance

Committee on Homeland Security and Governmental Affairs

Committee on Intelligence

U.S. House of Representatives

Committee on Appropriations

Committee on Financial Services

Committee on Foreign Affairs

Committee on Homeland Security

Committee on Intelligence

Committee on Oversight and Reform

Committee on Ways and Means
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