Jeremy Paner Discusses Recent 'Operation Economic Outcast' Bank Actions

Jeremy Paner was quoted in Arabian Gulf Business Insight on the impact of the recent OFAC and FinCEN “Operation Economic Outcast” actions against financial institutions in the UAE and Türkiye.

The article examines how recent U.S. Treasury actions against the UAE branches of Egypt's Banque Misr and Türkiye 's Golden Global Investment Bank will lead to increased scrutiny from U.S. correspondent banks and heightened compliance obligations across the region.

“The Treasury is essentially saying: ‘We have a problem with this.’ For an investigator – somebody sitting in a bank trying to dig into the risk rating of its relationships – that’s very valuable information,” Paner said.

He also noted that banks assess risk across broader financial networks, explaining that “the risk is not only in Turkey, because the Turkish financial institution will have other partners around the region.”

Paner also addressed how these actions complicate the compliance burden for institutions connected to the targeted banks.

“Maintaining relationships with the Egyptian bank is going to be more expensive because there’s going to be more compliance controls as it’s deemed a riskier bank,” Paner said. “It’s nearly impossible to completely separate out a branch from its parent.”

“If the cost of compliance is greater than the fees collected and the revenue generated from that relationship, then it’s an easy call for a bank.”

Read the article.