Precedent-Setting, Antifa-Related Foreign Terrorist Designations Amplify Risks for U.S. Tax-Exempt Organizations

For the first time, the Trump administration has designated entities as Foreign Terrorist Organizations (FTOs) because of their alleged ties to Antifa. These recent designations carry potential enforcement risks and consequences for U.S. tax-exempt entities, which we discuss in detail below.

Background

On November 13, 2025, the U.S. Department of State designated four European groups — Antifa Ost, based in Germany; Informal Anarchist Federation/International Revolutionary Front, a primarily Italian group; and Armed Proletarian Justice and Revolutionary Class Self-Defense, both Greek organizations — as FTOs because of their alleged ties to Antifa and involvement in threats and attacks against political and economic institutions in Europe. The designations mark the first time that the U.S. government has labeled groups allegedly affiliated with Antifa activism abroad as FTOs. The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) also designated the groups as Specially Designated Global Terrorists (SDGTs).

Additionally, on November 24, 2025, President Trump issued an Executive Order, “Designation of Certain Muslim Brotherhood Chapters as Foreign Terrorist Organizations and Specially Designated Global Terrorists,” which directed the Secretaries of State and the Treasury to begin the process of designating certain chapters or subdivisions of the Muslim Brotherhood as FTOs and SDGTs.

These actions come in the wake of President Trump’s September 2025 Executive Order designating Antifa as a domestic terrorist organization, and a National Security Presidential Memorandum, NSPM-7, which directs the U.S. Department of Justice, the Treasury, and the Internal Revenue Service to aggressively monitor, investigate, and take action against organizations purportedly linked — directly or indirectly — to acts of “political violence or domestic terrorism.” (We have previously discussed NSPM-7 on Enforcement Edge.)

Although the new designations target foreign entities, their implications extend into the United States — particularly for U.S. tax-exempt organizations, as well as their donors and supporters — who may be labeled as “Antifa-associated” by political actors or online commentators. As a whole, the Trump administration’s coordinated actions signal its intention to use counterterrorism regulatory and enforcement tools more aggressively against civil society organizations alleged to have ideological, structural, or financial connections to the recently designated groups.

Potential Enforcement Impact for U.S. Tax-Exempt Organizations

As discussed in a prior Enforcement Edge post, foreign terrorist designations trigger several domestic risks. We discuss these risks as applied to U.S. tax-exempt organizations below.

Criminal Risk

U.S. persons and entities may face criminal liability under 18 U.S.C. § 2339B (Section 2339B) for knowingly providing “material support” or resources to an FTO, which could include providing financial support in the form of grants, partnerships, or indirect support via third parties. Providing services, including training, expert advice, or other assistance also may be considered “material support.” As a result, if an organization conducts ordinary advocacy and operations with another entity (for example, joint protests or mutual aid), and the partner entity is affiliated with a designated group, the activity could be construed as material support to a foreign terrorist entity. In addition to criminal exposure, such designations enable the government to use broad civil forfeiture authorities to seize assets belonging to, controlled by, or used to support an FTO or facilitate its activities, even without a criminal conviction.

Financial De-Risking

Banks, payment processors, and crowdfunding platforms often react to perceived terrorist-financing risk. Once an “Antifa-associated” group appears on a foreign terrorist list, financial institutions may flag, freeze, or offboard accounts of U.S. organizations that are viewed as having direct or indirect ties to such groups. The recent designations suggest that domestic entities engaging in cross-border work, humanitarian relief, advocacy, refugee or immigrant support, or community outreach with partners abroad face potentially increased compliance exposure from these or future designations.

Strict-Liability Sanctions Risk

SDGT designations impose immediate strict-liability prohibitions for U.S. persons under the International Emergency Economic Powers Act (IEEPA). That is, even without knowing that the counterparty was sanctioned or that the conduct is prohibited, U.S. persons can be held civilly liable for engaging in an unlawful transaction with an SDGT. Accordingly, tax-exempt organizations face exposure for even indirect or unintended dealings with an SDGT — for example, comingling funds or co-hosting advocacy events or protests.

Potential Civil Litigation Risk

Foreign terrorist designations also create civil liability risk. Under the Antiterrorism Act, as amended by the Justice Against Sponsors of Terrorism Act, 18 U.S.C. § 2333 (Section 2333), any U.S. national injured “by reason of an act of international terrorism” committed, planned, or organized by an FTO may bring private civil actions, including aiding-and-abetting claims, against persons or entities alleged to have substantially assisted or conspired with the FTO. The causation and knowledge standards under Section 2333 are higher than the strict liability regime under IEEPA or the broad “material support” prohibitions of Section 2339B. Still, plaintiffs’ lawyers recently have tested these theories in lawsuits against financial institutions, technology platforms, and other businesses.

Reputational Risk

Finally, these designations pose reputational risk to U.S. tax-exempt organizations perceived as affiliated with these or other Antifa-aligned groups. As noted above, such affiliations may lead to financial de-risking, as well as potential donor attrition, investigative scrutiny, and a chilling effect on First Amendment activities, all of which can hinder a tax-exempt organization’s operations within the United States.

Impacts on the Transforming Landscape for U.S. Tax-Exempt Organizations and Their Funders

In his press statement on the designations, Secretary of State Marco Rubio linked the designations to NSPM-7, describing the State Department’s actions as a broader “initiative to disrupt self-described ‘anti-fascism’ networks, entities, and organizations,” and committed to “targeting other Antifa groups across the globe.” NSPM-7 already has direct and immediate implications for tax-exempt organizations — including charities, advocacy groups, and political entities — that the government perceives as espousing “anti-Americanism, anti-capitalism, and anti-Christian [views]; support for the overthrow of the United States Government; extremism on migration, race, and gender; [or] hostility towards those who hold traditional American views on family, religion, and morality.” The expansion of foreign terrorist designations to Antifa-affiliated groups amplifies the associated enforcement risks for domestic, tax-exempt organizations whom opponents may perceive as aligned with Antifa, including immigrant rights coalitions, racial justice organizations, and community defense groups, among others.

The Trump administration’s use of foreign terrorist designations signals its intention to apply an all-tools approach to its efforts to combat organizations and entities it views as affiliated with Antifa. Relatedly, at least one state, Texas, has itself designated foreign terrorist groups. On November 18, 2025, Texas Governor Greg Abbot issued a declaration designating both the Muslim Brotherhood and the Council on American-Islamic Relations, one of the nation’s largest Muslim advocacy and civil rights groups, as FTOs and transnational criminal organizations. Collectively, these developments show the increasing commitment at the federal and state levels to utilizing foreign terrorist designations to regulate financial flows between foreign and domestic entities.

Recommendations for U.S. Tax-Exempt Organizations

The recent Antifa-related designations — and the expansion of terrorist designations, generally — sharpen the compliance risks facing U.S. tax-exempt organizations. Organizations operating internationally or engaging in cross-border advocacy should assess whether their activities may create criminal or civil exposure and develop mitigation plans accordingly. Organizations also should perform rigorous due diligence on grantees, funders, and other international partners. Funders, including fiscal sponsors, should take special caution to reassess their exposure, document non-association with designated actors, and prepare for increased scrutiny as the enforcement landscape continues to evolve.

If you have questions about this Enforcement Edge post, please contact the authors or any of their colleagues in Arnold & Porter’s White Collar Defense & Investigations practice group.

* Nicholas Casmier Anway contributed to this Blog. Nicholas is employed as an associate in Arnold & Porter’s Washington, D.C. office.

© Arnold & Porter Kaye Scholer LLP 2025 All Rights Reserved. This Blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.