OFAC Issues License Allowing Maduro’s Criminal Defense Counsel to Be Paid by Government of Venezuela, and then Revokes it

In a development that implicates the tension between the rights of criminal defendants to be represented by counsel of their choice, and the right of the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) to prohibit the funding, by a sanctioned person or entity, of the defense of a criminal case against a different sanctioned person, OFAC has issued and then revoked a specific license to the defense attorneys retained to represent former Venezuelan President Nicolas Maduro and his wife Cilia Flores de Maduro.  Maduro and Flores are facing trial in the Southern District of New York on narcotics and firearms charges, following their capture by U.S. forces in January. The Government of Venezuela has offered to fund the pair’s defense. 

Maduro and Flores are on OFAC’s List of Specially Designated Nationals and Blocked Persons (the “SDN List”), which generally prohibits any U.S. person from providing services to them, and from receiving funds from them.  OFAC’s Venezuela Sanctions Regulations, 31 C.F.R. Section 591, allow certain exceptions. Under 31 C.F.R. §§ 591.506, a U.S. lawyer may undertake the “[r]epresentation of persons named as defendants in… legal… proceedings before any U.S. federal, state, or local court[.]”  The catch, however, is that “receipt of payment of professional fees… must be specifically licensed or otherwise authorized pursuant to § 591.507.”   Section 591.507 provides that the “receipt of payment of professional fees and reimbursement of incurred expenses… is authorized from funds originating outside the United States,” provided the funds do not originate from any entity “whose property and interests in property are blocked” by the regulations or an executive order.  The Government of Venezuela is on the SDN List, as a result of which its property and interests in property are blocked.  Accordingly, defense counsel may not receive payment from the Government of Venezuela without a specific license from OFAC.

After initially granting such a license, OFAC quickly revoked it.  Counsel for Maduro and Flores have moved to dismiss the indictment, claiming that revocation of the license violates their Sixth Amendment right to effective assistance of counsel, as well as their Fifth Amendment right to Due Process.  The defense argues that the U.S. government is using its power to selectively deprive Maduro and Flores of their defenses, by invoking sanctions regulations at the same time it has issued a series of broad general licenses (for use by the public) authorizing various commercial activities with the Government of Venezuela.  The defense points out that no fundamental constitutional right compels issuance of licenses allowing the public to engage in commercial activity with Venezuela, while the defense of a criminal case implicates Fifth and Sixth Amendment rights.  The U.S. government argues that the initial issuance of the license to defense counsel was an administrative error, that Maduro and Flores may use their own personal funds to pay for their defense, that they may have a court-appointed attorney, that there is no constitutional right to representation by a particular counsel, and that the authority of the United States to enforce sanctions laws overrides a defendant’s preference for a particular counsel. 

The issue is now pending before U.S. District Judge Alvin Hellerstein.  At a March 26, 2026 argument, Judge Hellerstein questioned whether there has been any violation of the right to effective assistance of counsel, but did not issue a ruling. 

The Maduro case continues to generate interesting legal issues.  Regardless of how Judge Hellerstein rules on the pending motion, it is likely that Maduro and Flores will continue to challenge the legality of their prosecution in multiple ways.