November 2, 2023

The Readbook is Kharon's weekly roundup of our published pieces, upcoming events, and the best-curated news feed on the intersection?of international security and global commerce.

ANNOUNCEMENTS

We are excited to announce the launch of our Sanctioned Securities solution, a powerful tool designed to give the banking and investment management industry the data they need to confidently and efficiently address a key challenge in risk management, pre-trade transaction monitoring, exclusions, and financial crimes compliance. [Learn more]

KHARON SNAPSHOT

Hamas Fundraising: U.S. Targets Hamas Investments

The U.S. Department of the Treasury has signaled that it will continue to aggressively go after Hamas's financial networks, imposing sanctions on a network of key financial operatives. Kharon's experts break down the network in our latest Snapshot video. [Watch Here]

THIS WEEK ON THE KHARON BRIEF

Sanctioned Hamas Financier Linked to Investment Companies in Sudan and Europe

A key Hamas financier sanctioned last week by the U.S. Department of the Treasury has been linked to a global network of enterprises, including a company at the center of Hamas’s global asset holdings and investment portfolio. [Read More]

KHARON IN THE NEWS

Kharon was named to the ESGFinTech100 list of the world’s most innovative ESG tech companies for the financial services industry. [Learn More]

In a recent Vogue Business article on the implementation and impact of the UFLPA, Kharon’s experts offered their thoughts on the challenges businesses face in adapting to the regulation. [Read More]

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MEDIA ROUNDUP

SANCTIONS        

The U.S. Government imposed sweeping sanctions in efforts to disrupt Russia's supply chains used for the procurement of technology and other equipment, as well as targeting Russia's domestic industrial base. ?[U.S. Treasury]

The U.S. Department of the Treasury published a new directive that prohibits certain financial services by U.S. persons to or for the benefit of Myanma Oil and Gas Enterprise, which remains the largest single source of foreign revenue for Burma’s military regime. [U.S. Treasury]

The U.S. Department of the Treasury imposed a second round of sanctions on key assets in Hamas’s investment portfolio, as well as individuals who are facilitating sanctions evasion by Hamas-affiliated companies. [U.S. Treasury]

Japan has imposed a fresh set of sanctions on individuals and a company connected to the Gaza-based militant group Hamas, according to a statement released by the Japanese foreign ministry. [Reuters]

A Turkish real estate investment fund responded to the U.S. imposition of sanctions on three of its shareholders on the grounds of providing aid to Hamas, saying it does not provide financial support to any organization. [Reuters]

The European Union is weighing a new round of sanctions that would hit some EUR 5 billion in trade with Russia, including export restrictions on welding machines, chemicals and further technologies used for military purposes. [Bloomberg]

Russia's President Vladimir Putin has cleared the way for a Cyprus-registered investment firm to transact in shares of four Russian groups in which it holds minority stakes, including Gazprom. [Reuters]

Nearly two years since the invasion of Ukraine, a handful of western banks and traders are increasingly willing to enter new deals for Russian metals, seizing opportunities for profit while competitors hold back. [Bloomberg]

EU leaders endorsed unprecedented plans to use profits generated by frozen Russian state assets for Ukraine reconstruction, and called on the European Commission to make legal proposals to that effect. [Politico]

The United Nations released its midterm Panel of Experts report on North Korea, covering the reporting period from January to July 2023, detailing how the regime in North Korea continues to evade United Nations sanctions. [U.N.]

North Korea likely breached an annual cap on oil imports set by the U.N. within the first five months of the year, employing obscure tankers for clandestine fuel delivery operations, according to a new U.N. report. [NK News]

COMPLIANCE + ENFORCEMENT        

At its plenary meeting, FATF advanced numerous initiatives to strengthen global AML and counter-terrorist financing standards. Four jurisdictions were also removed from the FATF gray list.? [U.S. Treasury] [FATF]

Türkiye is preparing new legislation covering crypto-assets to persuade FATF to remove it from a "grey list" of countries that have taken insufficient action to prevent money laundering and terrorist financing. [Reuters]

The Economic Crime and Corporate Transparency Act received Royal Assent in the U.K allowing authorities to proactively target organized criminals and others seeking to abuse the U.K.’s open economy. [GOV.UK]

A U.S. Justice Department policy shift around the disclosure of possible wrongdoing uncovered in mergers and acquisitions reinforces the need for buyers to dive deep into a target’s compliance efforts, both before and after a deal closes.? [WSJ]

A U.S. resident and two Russian-Canadian nationals were charged by U.S. authorities with a massive sanctions evasion and export control scheme, in which dual-use electronic components were unlawfully exported to Russia through Brooklyn front companies. [U.S. Justice]

A Dutch court convicted a Russian businessman of exporting computer chips and other electronic products to the Russian arms and defense industry in violation of European Union sanctions and sentenced him to 18 months in jail. [AP]

Russian tycoon Alexey Kuzmichev has been detained for questioning in France in connection with alleged tax evasion and money laundering and for violating international sanctions. [Reuters]

Canada’s Financial Transactions and Reports Analysis Centre imposed an administrative monetary penalty on a precious metals and stones dealer for its failure to assess and document money laundering and terrorist activity financing risk. [FINTRAC]

EXPORT CONTROLS + SUPPLY CHAIN        

New U.S. export controls may compel a California-based AI firm to cancel billions of dollars in next-year orders for its advanced chips to China, a move that could deprive Chinese tech companies of crucial AI resources. [WSJ]

China's state-backed chip investment fund has invested nearly USD 2 billion in a memory chip company. [Reuters]

HUMAN RIGHTS + FORCED LABOR        

China set out plans to develop a free trade zone in its northwestern Xinjiang region, despite Western sanctions, rooting it in President Xi Jinping's ambitious Belt and Road Initiative to connect the country to Europe through economic corridors. [Reuters]