A golf course in Marion, Illinois, is set to close as a result of economic sanctions imposed by the Department of Treasury’s Office of Foreign Assets Control against Zimbabwe’s Robert Mugabe and his cronies. How do the Mugabe sanctions have an impact almost 9,000 miles away?

According to this story in an Illinois newspaper, Kokopelli Golf Course was purchased, almost 15 months ago, from a Florida partnership by local investors. One of the partners in the Florida partnership, it appears, was John Bredenkamp, alleged by OFAC to be a Mugabe crony — a charge that Bredenkamp denies. So OFAC blocked the title to the golf course and the sale hasn’t closed, despite the intervention of Senator Durbin, the senior senator from Illinois, and despite arguments that the closing of the golf course as a result of OFAC’s blocking title to the club would have a significant impact on the local economy. Indeed, the closing of this town’s golf club would appear to be the only visible impact of the Mugabe sanctions since, the last time I checked, Mugabe was still sitting fat, happy, rich and in power in Zimbabwe.

The news story does not reveal the size of Bredenkamp’s interest in the partnership that owned the golf club. If his interest was greater than 50 percent, then under current OFAC guidance, as this blog reported here, the partnership and all of its assets, including the golf club, would be a blocked asset. This case shows the problem with such a rule is that it potentially punishes innocent parties. Assuming, as is likely the case, that the other partners entered into the partnership with Bredenkamp prior to Bredenkamp becoming designated by OFAC as subject to the Mugabe sanctions, there is no conceivable reason to punish the other partners. Instead, OFAC should block Bredenkamp’s interest in the partnership and any revenue due to him under the partnership agreement. The policy behind this position is even more obvious when blocking the interest of innocent partners has an impact on the economy of a small U.S. town.

If the Kokopelli Golf Club closes, Marion residents can, ironically, always go to Zimbabwe to tee off. According to Golf Digest:

Despite hyperinflation, cholera and hugely unpopular President Robert Mugabe, golf survives in Zimbabwe. At Bulawayo Golf Club (founded in 1895), members have been paying with gasoline because local bank notes are now worthless.

Fore!

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