The Magnitsky Act, adopted in 2012 to tackle Russian corruption and expanded in 2016 to cover serious human rights abuses globally, is an extremely powerful tool to hold perpetrators accountable.
Managed by the Departments of the Treasury and State, more than 200 individuals and companies have been sanctioned to date. Sanctions include visa denials, asset freezes and the inability to transact in dollars. In November, the newest designees were announced, notably, members of a Libyan militia responsible for mass killings and a Lebanese politician with ties to Hezbollah.
The Magnitsky model has proven appealing. Canada and the U.K. passed similar legislation in 2017 and 2018 respectively, and an EU version is set to take effect in January 2021.
Given the significant ramifications of a Magnitsky designation, it is essential that the U.S. government periodically examine its administration of the law. Despite its noble intent, the law raises several due process issues.
One area of concern is whether designation punishes past activity or prevents ongoing abuses. The Treasury Department’s Office of Foreign Assets Control (OFAC) notes that “The ultimate goal of sanctions is not to punish, but to bring about a positive change in behavior.”
However, it seems that some listings are really aimed at punishing past activity, particularly where it proved impossible to carry out a criminal prosecution. If so, where wrongdoing has ceased, the imposition of unlimited and potentially indefinite sanctions could violate due process and other rights. Convicted criminals are able to make restitution by serving their sentences and/or paying fines.