A prepenalty notice means OFAC believes violations occurred and proposes a number. The response window printed on the notice is short and consequential — because penalty math moves substantially on factors the response controls.
OFAC's enforcement guidelines score aggravating and mitigating factors: willfulness, management knowledge, pattern versus isolated slip, sophistication, compliance program quality, cooperation, remediation. The response's job is to re-score the case — documented remediation and a credible compliance narrative move proposed penalties down in published settlements over and over. Base-penalty mechanics (transaction values, self-disclosure status, egregiousness determinations) each have argument surface too.
Published outcomes show meaningful movement between proposed and settled figures where responses engaged the guideline factors with evidence. No outcome is promised; the mechanism is real.
The interplay between an open case and new disclosures is genuinely strategic — timing and packaging change the math. Decide with counsel, not by reflex in either direction.
Final penalties are challengeable in federal court under the APA. It's the road less traveled for reasons — cost, disclosure, deference — but it exists, and its existence disciplines the settlement table.