November 21, 2024
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. Subscribe to the email version .
/EVENTS
Navigating the Complexities of Russian Diversion: Risks, Enforcement, and Compliance Strategies
Join experts from Kharon, Descartes, and PwC as they unpack how Russia circumvents sanctions through diversion tactics, discuss recent enforcement actions, and share key strategies for detecting and mitigating these risks. [Register Here ]
/THIS WEEK ON THE KHARON BRIEF
UK Sanctions Update Adds Four New Sectors, Bolstering Compliance
Our recent report explains the U.K.’s new sanctions regulations and what firms need to know about these changes — coming May 2025 — to stay compliant and avoid penalties. [Read More ]
Russian Network Linked to Sanctioned Chinese Aircraft Engine Manufacturer
As the U.S. continues to crack down on China’s military supply to Russia with recent sanctions, Kharon has uncovered that a Chinese company supplied aircraft engines to an affiliated Russian defense contractor months after the invasion of Ukraine. [Read more ]
/MEDIA ROUNDUP
SANCTIONS
The U.K.’s OFSI introduced changes to sanctions legislation that will improve its intelligence on industry’s compliance with financial sanctions, strengthen its enforcement powers, enable it to deal with licensing applications more efficiently, and clarify financial sanctions legislation where there is existing uncertainty. [U.K. Government ]
OFAC and OFSI marked the two-year anniversary of their enhanced partnership, reaffirming their shared commitment to global security through the development and implementation of effective sanctions. [U.S. Treasury ]
The U.S. Department of the Treasury and the U.S. Department of State sanctioned six individuals and entities for their involvement in perpetrating violence in the West Bank. [U.S. Treasury ] [U.S. State ]
Nearly 90 Democratic lawmakers urged U.S. President Joe Biden to sanction members of Israeli Prime Minister Benjamin Netanyahu's government over anti-Palestinian violence in the West Bank, according to a letter released last week. [Reuters ]
The U.S. Department of the Treasury targeted key Hamas officials as well as individuals involved in supporting the terrorist group’s fundraising efforts and weapons smuggling into Gaza. [U.S. Treasury ]
The U.S. Department of the Treasury sanctioned 26 companies, individuals, and vessels associated with a Syrian conglomerate responsible for generating hundreds of millions of dollars in revenue for Iran’s Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF) and the Houthis through the sale of Iranian oil to Syria and China. [U.S. Treasury ]
Donald Trump’s new administration will revive its “maximum pressure” policy to “bankrupt” Iran’s ability to fund regional proxies and develop nuclear weapons, according to people familiar with the transition. [FT ]
In an annual report, the U.S.-China Economic and Security Review Commission called on lawmakers to mandate a detailed study within six months to look at how Iranian oil has entered China through indirect routes, allowing the country to “insulate itself from sanctions.” [SCMP ]
Billions of dollars of sanctioned Iranian oil is finding its way to China annually, as a burgeoning group of dark fleet vessels operates with impunity on the edge of a major maritime thoroughfare. [Bloomberg ]
The EU widened its restrictive measures on Iran in view of Iran’s military support to Russia’s war of aggression against Ukraine and to armed groups and entities in the Middle East and the Red Sea region. [EU Council ]
The U.K. announced further measures against Iran in response to its transfer of ballistic missiles to Russia, aiding its war in Ukraine. [U.K. Government ]
The U.K. sanctioned ten officials and organizations involved in Russia’s forcible deportation and attempted indoctrination of Ukrainian children. [U.K. Government ]
OFSI said it has identified instances where shipments of Russian-origin oil and oil products have been manipulated to appear as non-Russian through the use of fabricated or falsified certificates of origin, and issued an advisory with an overview of red flags to identify such activity and potential mitigation measures. [U.K. Government ]
Leaders of the Group of Seven (G7) major democracies reiterated a pledge to keep imposing severe costs on Russia for its invasion of Ukraine, through sanctions, export controls, and other measures, and vowed to support Kyiv for as long as it takes. [Reuters ]
The EU is working on a new package of sanctions aimed at targeting the shadow fleet of tankers Russia is using to get its oil to market, according to people familiar with the matter. [Bloomberg ]
The Biden administration is considering additional financial sanctions on Russia as the White House moves to prohibit U.S. banks from dealing with Gazprombank, a major Russian lender that plays a key role in energy transactions. [Nikkei Asia ]
A U.K. investment company founded by sanctioned Russian billionaires failed to overturn a British government-ordered sale of a broadband service provider after a London court ruled the decision was fair and reasonable. [Bloomberg ]
Companies registered in the British Overseas Territories exported USD 134 million worth of goods to Russia in 2024 in an apparent breach of U.K. sanctions, according to a Financial Times analysis of Russian filings. [FT ]
The U.S. Department of the Treasury sanctioned a network of nine Mexican nationals involved in the trafficking of fentanyl, heroin, and other deadly drugs, as well as money laundering and human smuggling. [U.S. Treasury ]
The U.K. sanctioned three notorious kleptocrats who have siphoned wealth from their home countries, as well as their friends, families, and fixers who helped them. [U.K. Government ]
Myanmar civil society groups said Washington should impose sanctions on a Myanmar bank being used to circumvent existing U.S. restrictions, urging the outgoing Biden administration to cut off a key source of foreign currency for the country's military junta. [Reuters ]
The U.S. imposed sanctions three years ago against the ruling party of Eritrea, yet Eritrea’s embassy in Washington has helped raise millions of dollars on behalf of the cash-strapped country since then. [WaPo ]
In a recent report, the Swiss Financial Market Supervisory Authority (FINMA) identified nine significant principal risks for the financial sector, and also outlined increased risks related to sanctions and cyberattacks, particularly via third parties. [FINMA ]
COMPLIANCE + ENFORCEMENT
The U.S. Department of the Treasury, as Chair of the Committee on Foreign Investment in the United States (CFIUS), issued a final rule to enhance certain CFIUS procedures and sharpen its penalty and enforcement authorities. [U.S. Treasury ]
OFAC issued a monetary penalty on a U.S. person for executing a plan to purchase, renovate, and operate a hotel in Iran and for using foreign money services businesses in Iran and Canada to evade U.S. sanctions. [U.S. Treasury ]
A Syrian national was indicted for illegally diverting more than USD 9 million in U.S.-funded humanitarian aid intended for Syrian civilians to armed combatant groups, including the Al-Nusrah Front, a designated foreign terrorist organization affiliated with al-Qaida in Iraq. [U.S. Justice ]
The U.S. Federal Reserve Board issued an enforcement action against a U.S. bank for deficiencies in various areas, including the bank’s risk management practices and compliance with BSA/AML regulations. [U.S. Federal Reserve Board ]
A major bank is being investigated by U.S. government agencies over its ties to a sanctioned Russian official, according to a person familiar with the matter. [Bloomberg ]
A Venezuelan national was sentenced to prison for conspiring to violate the International Emergency Economic Powers Act and for his role in a scheme to evade U.S. sanctions imposed on Venezuela’s state-owned oil company, PDVSA. [U.S. Justice ]
A U.S.-based life insurance company agreed to pay USD 178,421 to settle its potential civil liability for apparent violations of OFAC sanctions on Iran. [U.S. Treasury ]
TRADE CONTROLS + SUPPLY CHAIN
U.S. lawmakers introduced the Restoring Trade Fairness Act, a bill that would revoke China’s permanent normal trade relations with the U.S. [Select Committee on the CCP ]
HUMAN RIGHTS
The EU adopted a regulation, effective in three years, that will prohibit products in the EU market that are made using forced labor and said it will create a database of forced labor risk areas or products to support the work of authorities in assessing possible violations of this regulation. [EU Council ]
The U.S. Office of the Director of National Intelligence (ODNI) published a report on Uyghur genocide and concentrated reeducation camps in Xinjiang. [U.S. ODNI ]
U.S. Customs and Border Protection (CBP) released operational statistics for October, noting that last month the agency stopped 557 shipments valued at more than USD 38 million for further examination based on the suspected use of forced labor. [U.S. CBP ]
A bipartisan group of U.S. legislators urged Secretary of State Antony Blinken to issue a report on prison conditions in Hong Kong and take additional diplomatic steps to address reported instances of torture and mistreatment of political prisoners. [Select Committee on the CCP ]
CRYPTO + CYBER
A dual U.S.-Russian national was sentenced to prison for his involvement in a money laundering conspiracy arising from the hack and theft of approximately 120,000 bitcoin from a global cryptocurrency exchange. [U.S. Justice ]
An Ohio man was sentenced to prison for his operation of the darknet cryptocurrency mixer Helix, which processed transactions involving over USD 300 million worth of cryptocurrency from 2014 to 2017. [U.S. Justice ]
The U.S. Department of Justice unsealed criminal charges against a Russian national for allegedly administering the sale, distribution, and operation of Phobos ransomware. [U.S. Justice ]