US Judge Upholds OFAC Sanctions on Ex-Guatemala Official ‘Miguelito’ Martínez

Judge Rejects Challenge by Former Guatemalan Official

A U.S. federal judge has upheld the Treasury Department’s decision to keep former Guatemalan official Luis Miguel Martínez Morales on the Specially Designated Nationals (SDN) list, maintaining the asset freeze and financial restrictions against him. Judge Beryl A. Howell of the U.S. District Court for the District of Columbia ruled that the Office of Foreign Assets Control (OFAC) acted within its legal authority when it rejected Martínez’s request to be removed from the sanctions roster.

Martínez, widely known in Guatemala as “Miguelito,” was designated by OFAC on December 1, 2023, under Executive Order 13818, which targets serious human rights abuse and corruption globally. U.S. authorities accused him of using his position as head of the quasi-ministerial Center of Government during the presidency of Alejandro Giammattei to steer state contracts to firms in which he had financial interests and to circumvent formal bidding processes. The case also referenced allegations of bribes linked to the purchase of 16 million doses of Russia’s Sputnik V COVID-19 vaccine.

Martínez argued that the accusations related to old events and that a Guatemalan anti-corruption agency had cleared him in the vaccine matter. However, after a formal review, OFAC notified him in February 2025 that foreign court or prosecutorial decisions are not binding on U.S. sanctions determinations and that he had failed to present sufficient evidence to rebut the available information or demonstrate a change in circumstances. The court agreed, noting that the agency “has determined that the arguments presented by [Martínez] do not refute the information available to OFAC.”

Behind the Ruling: OFAC’s Broad Discretion and the Burden of Proof

How the Court Reinforced OFAC’s Autonomy

The ruling underscores a core principle of U.S. sanctions law: OFAC’s administrative reviews are not secondary trials of foreign court decisions. Judge Howell’s decision makes clear that a target’s exoneration in a local jurisdiction carries no weight unless the sanctioned individual can independently disprove the factual basis that underpinned the listing. The court’s deference to the Treasury’s fact-finding process effectively raises the bar for any challenge—Martínez’s failure to produce “sufficient evidence” to change OFAC’s mind was fatal to his case.

The Sputnik V Angle and Its Diplomatic Echoes

The mention of bribes tied to the 16-million-dose Sputnik V procurement adds a layer of sensitivity. The deal, brokered during the height of the pandemic, has been the subject of scrutiny in Guatemala and beyond. While the court did not adjudicate the truth of the bribe allegations, their inclusion in the record signals that U.S. authorities view the transaction as part of a broader pattern of corrupt practices, potentially complicating efforts by other governments to distance themselves from problematic vaccine deals that intersected with U.S. sanctions frameworks.

What This Means for the Giammattei Circle

Martínez was arguably the most powerful unelected figure in Giammattei’s government, with influence over appointments, contracts and strategic decisions even after his formal role was dissolved in late 2020. The sanctions and now the court’s validation effectively freeze any U.S.-held assets and block any future access to the American financial system. That not only isolates Martínez personally but also sends a warning to other former officials in the region who may be under investigation: a political or judicial clean bill of health at home does not guarantee immunity from U.S. designations.

What the Martínez Case Signals for Sanctions Compliance

• For compliance teams at international banks and corporations: treat the ruling as a fresh reminder that U.S. sanctions due diligence cannot rely on foreign court findings. Screening systems should flag all persons designated by OFAC regardless of local judicial or prosecutorial updates.
• For law firms representing sanctioned individuals: note the explicit requirement to present “sufficient evidence” and demonstrate a “change of circumstances.” The Martínez case illustrates that merely citing an overseas exoneration is inadequate; a robust, fact-based rebuttal is essential for any delisting request.
• For governments in Central America: expect continued scrutiny of pandemic-era procurement contracts. The U.S. Department of Justice and OFAC are increasingly weaving together corruption, health security and sanctions enforcement, raising the stakes for officials who may have been cleared domestically but remain exposed under U.S. jurisdiction.