As I understand it, Bitcoin mining involves selecting which unconfirmed transactions (mem pool transactions) to include in the block. A common algorithm for selecting them is ones with higher fees. Another aspect could be ignoring ones from sanctioned wallet IDs. If treasury.gov had a monthly-updating CSV file of wallet IDs that are sanctioned, then the person setting up the mining software could have a cron job to refresh treasury.gov's list periodically. Would that work?

I think you're saying this would be a big hassle, maybe for miners. Can you explain that more?