This newsletter is a listing of the latest changes in export control regulations through November 30, 2023. The newsletter is provided as a complimentary service to assist exporters with their ITAR and EAR export compliance responsibilities. It provides a summary of recent changes to export control regulations or other regulatory matters of interest that may impact your company’s international trade and export compliance functions. Call us at 703-847-5801 or email info@fdassociates.net with questions or comments.
See also our “Latest Sanctions Fines & Penalties” section below for an update on companies and persons denied export privileges by the United States Government.
REGULATORY UPDATES
The President
President Biden Signs Executive Order Establishing Artificial Intelligence Policy for the Federal Government
November 1, 2023: 88 FR 75191: On October 30, 2023, the Biden Administration issued Executive Order (E.O.) 14110 on Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence. It establishes a government-wide effort to guide responsible artificial intelligence (AI) development and deployment through federal agency leadership, regulation of industry, and engagement with international partners.
The E.O. directs over 50 federal entities to engage in more than 100 specific actions to implement the guidance set forth across eight overarching policy areas.
- Safety and security. The E.O. promotes the development and implementation of repeatable processes and mechanisms to understand and mitigate risks related to AI adoption, including with respect to biosecurity, cybersecurity, national security, and critical infrastructure.
- Innovation and competition. The E.O. compels actions to attract AI talent to the United States, understand novel intellectual property (IP) questions, protect inventors and creators, and promote AI innovation, including at startups and small businesses.
- Worker support. The E.O. states that AI adoption may be disruptive to the workforce and directs agencies to research and develop potential mitigations against such disruptions.
- Consideration of AI bias and civil rights. The E.O. states that AI models may perpetuate biases and their implementation may lead to civil rights violations. The E.O. includes a section on equity and civil rights considerations for use of AI in the criminal justice system and the administration of federal government programs and benefits.
- Consumer protection. The E.O. instructs agencies to enforce existing, technology-agnostic authorities in an effort to minimize harm to consumers, and to identify needed authorities related to AI.
- The E.O. calls for the evaluation and mitigation of privacy risks—potentially exacerbated by AI— associated with the collection, use, and retention of user data.
- Federal use of AI. The E.O. requires the Office of Management and Budget (OMB) to establish an interagency council to coordinate AI use by federal agencies and develop guidance on AI governance and risk management activities for agencies. It acknowledges the ubiquity of generative AI (GenAI) tools, and directs agencies to move toward adoption with safeguards in place. The E.O. also calls for additional agency hiring and training activities to increase the AI workforce capacity across the federal government.
- International leadership. The E.O. declares that the United States should be a global leader in AI development and adoption by engaging with international allies and partners, leading efforts to develop common AI regulatory and accountability principles and advancing responsible global technical standards for AI.
https://www.federalregister.gov/d/2023-24283
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White House Announces Continuation of National Emergency with Respect to Iran
November 7, 2023: On November 14, 1979, by Executive Order 12170, the President declared a national emergency with respect to Iran pursuant to the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) and took related steps to deal with the unusual and extraordinary threat to the national security, foreign policy, and economy of the United States constituted by the situation in Iran.
U.S. relations with Iran have not yet normalized, and the process of implementing the agreements with Iran, dated January 19, 1981, is ongoing. For this reason, the national emergency declared on November 14, 1979, and the measures adopted on that date to deal with that emergency, must continue in effect beyond November 14, 2023. Therefore, in accordance with section 202(d) of the National Emergencies Act (50 U.S.C. 1622(d)), President Biden authorized the continuation for 1 year the national emergency with respect to Iran declared in Executive Order 12170.
The emergency declared by Executive Order 12170 is distinct from the emergency declared in Executive Order 12957 on March 15, 1995. This renewal, therefore, is distinct from the emergency renewal of March 10, 2023.
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Department of State, Directorate of Defense Trade Controls (DDTC)
DDTC Name and Address Changes Posted To Website
November 13 through 29, 2023: The Directorate of Defense Trade Controls (DDTC) posted the following name and/or address changes on its website at:
- Change in name from Callenberg Technology AB to Trident BMC AB due to acquisition.
- Change in name and address from General Electric International, Inc. (Israel), 40 Tuval Street, 13th Floor, Ramat Gan 5252247, Israel to GE Aviation Systems North America LLC, 21 Leonardo Da Vinci St., Tel Aviv 6473319, Israel, and all locations in Israel.
- Change in name from L-3 Communications India Private Ltd. to L3Harris Maritime & Aero Private Ltd. due to corporate reorganization.
- Change in address for Airbus Military, S.L. from Avenida Aragón 404, 28022 Madrid, Spain to Calle Aviocar 2, 28906 Getafe, Madrid, Spain.
- Change in name from Teledyne FLIR Detection, Inc. to Teledyne FLIR Defense, Inc. due to corporate reorganization.
- Change in name from Babcock Defence and Security Holdings LLP to Babcock Land Defence Limited due to corporate restructuring.
- Change in address from Warwick House, Farnborough Aerospace Centre, Farnborough, Hampshire, GU14 6YU, United Kingdom to Victory Point, Lyon Way, Frimley, Camberley, Surrey, GU16 7EX, United Kingdom for the following entities due to corporate restructuring:
- BAE Systems (Defence Systems) Limited
- BAE Systems (Global Combat Munitions) Limited
- BAE Systems (International) Limited
- BAE Systems (Military Air) Overseas Limited
- BAE Systems (Oman) Limited
- BAE Systems (Operations) Limited
- BAE Systems Display Technologies Limited
- BAE Systems Electronic Systems (Overseas) Limited
- BAE Systems Global Combat Systems Limited
- BAE Systems (Global Combat Munitions) Limited
- BAE Systems Hawk (Synthetic Training) Limited
- BAE Systems Integrated System Technologies
- BAE Systems (Marine) Limited
- BAE Systems Surface Ships Limited
- BAE Systems Integrated System Technologies (Overseas) Limited
- BAE Systems Project Services Limited
- BAE Systems Surface Ships International Limited
- BAE Systems Global Combat Systems Munitions Limited
- BAE Systems (Defence Systems) Limited
- BAE Systems Services Limited
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Department of Defense
DSCA Notifies Congress of Potential FMS Sale To Iraq
November 2, 2023: The State Department made a determination approving a possible Foreign Military Sale to the Government of Iraq of Bell Helicopter Contracted Logistics Support (CLS) and related equipment for an estimated cost of $300 million. The Defense Security Cooperation Agency delivered the required certification notifying Congress of the possible sale, which will support the foreign policy and national security of the United States by helping to improve the security of a strategic partner. Further, the proposed sale will improve the Republic of Iraq’s capability to meet current and future threats by enhancing the strength of its homeland defense. The Republic of Iraq will have no difficulty absorbing these services into its armed forces.
https://www.dsca.mil/sites/default/files/mas/Press%20Release%20-%2023-63%20Iraq%20CN.pdf
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DSCA Notifies Congress of Potential FMS Sale To Romania
November 9, 2023: The State Department made a determination approving a possible Foreign Military Sale to the Government of Romania of M1A2 Abrams Main Battle Tanks and related equipment for an estimated cost of $2.53 billion. The Defense Security Cooperation Agency delivered the required certification notifying Congress of this possible sale, which will support the foreign policy and national security objectives of the United States by helping to improve the security of a NATO Ally which is an important force for political and economic stability in Europe. Further, the proposed sale will improve Romania’s capability to meet current and future threats by providing a credible force that is capable of deterring adversaries and participating in NATO operations. Romania will have no difficulty absorbing this equipment into its armed forces.
https://www.dsca.mil/sites/default/files/mas/Press%20Release%20-%20Romania%2023-71%20CN.pdf
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DSCA Notifies Congress of Potential FMS Sale To South Korea
November 14, 2023: The State Department made a determination approving a possible Foreign Military Sale to the Republic of Korea of Standard Missile 6 Block I (SM-6 Blk I) and related equipment for an estimated cost of $650 million. The Defense Security Cooperation Agency delivered the required certification notifying Congress of this possible sale, which will support the foreign policy goals and national security objectives of the United States by improving the security of a major ally that is a force for political stability and economic progress in the Indo-Pacific region. Further, the proposed sale will improve the Republic of Korea’s capability to meet current and future threats while further enhancing interoperability with the United States and other allies. The Republic of Korea will have no difficulty absorbing these articles into its armed forces.
https://www.dsca.mil/sites/default/files/mas/Press%20Release%20-%20Korea%2023-78%20CN.pdf
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DSCA Notifies Congress of Potential FMS Sale To South Korea
November 15, 2023: The State Department made a determination approving a possible Foreign Military Sale to the Republic of Korea of AIM-9X Block II and Block II+ (Plus) Sidewinder Missiles and related equipment for an estimated cost of $52.1 million. The Defense Security Cooperation Agency delivered the required certification notifying Congress of this possible sale, which will support the foreign policy goals and national security objectives of the United States by improving the security of a major ally that is a force for political stability and economic progress in the Indo-Pacific region. Further, the proposed sale will improve the Republic of Korea’s capability to meet current and future threats while further enhancing interoperability with the United States and other allies. Korea will have no difficulty absorbing these articles into its armed forces.
https://www.dsca.mil/sites/default/files/mas/Press%20Release%20-%20Korea%2023-76%20CN.pdf
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DSCA Notifies Congress of Potential FMS Sale To Japan
November 17, 2023: The State Department made a determination approving a possible Foreign Military Sale to the Government of Japan of Tomahawk Weapon System and related equipment for an estimated cost of $2.35 billion. The Defense Security Cooperation Agency delivered the required certification notifying Congress of this possible sale, which will support the foreign policy goals and national security objectives of the United States by improving the security of a major ally that is a force for political stability and economic progress in the Indo-Pacific region. Further, the proposed sale will improve Japan’s capability to meet current and future threats by providing a long range, conventional surface-to-surface missile with significant standoff range that can neutralize growing threats. Japan will have no difficulty absorbing these articles into its armed forces.
https://www.dsca.mil/sites/default/files/mas/Press%20Release%20-%20Japan%2023-69%20CN.pdf
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Department of Commerce – Bureau of Industry and Security (BIS)
FinCEN and the U.S. Department of Commerce’s Bureau of Industry and Security Announce New Reporting Key Term and Highlight Red Flags Relating to Global Evasion of U.S. Export Controls
November 6, 2023: the Department of Commerce’s Bureau of Industry and Security (BIS) and the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) issued a joint notice highlighting a new Suspicious Activity Report (SAR) key term (“FIN-2023-GLOBALEXPORT”) for financial institutions to reference when reporting potential efforts by individuals or entities seeking to evade U.S. export controls not related to Russia’s invasion of Ukraine. FinCEN and BIS previously issued two joint alerts in June 2022 and May 2023 urging financial institutions to be vigilant against potential Russian export control evasion in response to Russia’s illegal invasion of Ukraine. Financial institutions are encouraged to continue to use the key term “FIN-2022-RUSSIABIS” when filing SARs related to suspected Russian export control evasion.
The joint notice emphasizes the importance of financial institutions applying a risk-based approach to trade transactions and remaining vigilant against efforts by individuals or entities seeking to evade export controls, globally. This joint notice highlights global red flag indicators of export control evasion, with a focus on advanced and critical technologies, that also can be applicable to due diligence efforts of exporters in addition to financial institutions.
BIS leverages SARs to investigate violations of U.S. export control regulations. Investigations involving advanced technologies (e.g., advanced semiconductors, quantum, hypersonics) sought by nation state adversaries to support military modernization efforts designed to overcome U.S. military superiority, or mass surveillance programs that enable human rights abuses are being prioritized and worked through the interagency Disruptive Technology Strike Force, co-led by BIS and the Department of Justice.
The joint notice is part of the ongoing efforts by BIS and the U.S. Department of the Treasury to strengthen export controls and prevent global evasion of U.S. export controls. By working together and leveraging their respective expertise, BIS and FinCEN aim to disrupt illicit acquisition activities and enhance the overall security and integrity of the international trade and financial systems.
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| LATEST FINES, PENALTIES AND SANCTIONS |
This section of our newsletter provides information on the latest sanctions, fines and penalties for export violations or matters of non-compliance with the ITAR or EAR issued by the US government enforcement agencies. It is provided as a service to exporters and associates of FD Associates to remind them of the importance of extreme due diligence in all international trade and export compliance matters, particularly those involving exports subject to the ITAR or the EAR. Don’t let this happen to you or your company! Call us with questions or concerns at 703-847-5801 or email info@fdassociates.net.
Fines and Penalties
November 1, 2023: Four individuals were arrested, and an indictment and criminal complaint were unsealed in the Eastern District of New York regarding two separate conspiracies to unlawfully export controlled, dual-use technologies to Russia following Russia’s full-scale invasion of Ukraine.
A Brooklyn, New York, resident and two Canadian nationals were also arrested in connection with a sophisticated global procurement scheme in which the defendants used two corporate entities registered in Brooklyn to unlawfully source and purchase millions of dollars’ worth of dual-use electronics on behalf of end-users in Russia, including companies affiliated with the Russian military. Some of the electronic components and integrated circuits shipped by the defendants are the same make, model, and part number that have been found in seized Russian weapons platforms and signals intelligence equipment in Ukraine.
Separately, a Brooklyn resident was arrested, and a four-count indictment was unsealed alleging an illegal exports scheme to procure dual-use electronic components for entities in Russia involved in the development and manufacture of drones for the Russian war effort in Ukraine.
According to court documents, Nikolay Goltsev, 37, of Montreal, Canada; Salimdzhon Nasriddinov, 52, of Brooklyn; and Kristina Puzyreva, 32, of Montreal, Canada have been charged in a sanctions evasion and export control scheme, in which millions of dollars’ worth of semiconductors, integrated circuits and other dual-use electronic components were unlawfully exported to Russia through two Brooklyn front companies.
In a four-count indictment unsealed in the Eastern District of New York, Nikita Arkhipov, 39, and Artem Oloviannikov, 37, both of St. Petersburg, Russia; and Nikolay Grigorev, 36, of Brooklyn; are charged with conspiracy and other offenses related to an export control scheme to benefit companies affiliated with the Russian military, including SMT-iLogic, a sanctioned Russian entity that has been identified as part of the supply chain for producing Russian military drones used in Russia’s war against Ukraine.
These actions were coordinated through the Justice and Commerce Departments’ Disruptive Technology Strike Force and the Justice Department’s Task Force KleptoCapture. The Disruptive Technology Strike Force is an interagency law enforcement strike force co-led by the Departments of Justice and Commerce designed to target illicit actors, protect supply chains, and prevent critical technology from being acquired by authoritarian regimes and hostile nation states. Task Force KleptoCapture is an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export restrictions and economic countermeasures that the United States has imposed, along with its allies and partners, in response to Russia’s unprovoked military invasion of Ukraine.
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November 3, 2023: The Department of Commerce’s Bureau of Industry and Security (BIS) announced the imposition of a civil penalty of $44,750 against Forta LLC (Forta), a manufacturer of synthetic reinforcement fibers, located in Grove City, Pennsylvania, to resolve three violations of the antiboycott provisions of the Export Administration Regulations (EAR, 15 C.F.R. parts 730-774) (antiboycott regulations), as alleged in BIS’s Proposed Charging Letter (PCL). Forta voluntarily disclosed the conduct to BIS, cooperated with the investigation by BIS’s Office of Antiboycott Compliance (OAC), and took remedial measures after discovering the conduct at issue, all of which resulted in a significant reduction in penalty.
As part of the settlement with BIS, Forta admitted to the conduct set forth in the PCL, which alleged violations involving the furnishing of information about business relationships with boycotted countries or blacklisted persons and the failure to report the receipt of a request to engage in a restrictive trade practice or foreign boycott against a country friendly to the United States. Specifically, Forta participated in a trade show in Abu Dhabi in 2019. In connection with the shipment of products and items for display at the trade show, the company furnished to its freight forwarder a commercial invoice/packing list certifying that the goods were not of Israeli origin and not manufactured by a company on the “Israeli Boycott Blacklist.” Furnishing such information is prohibited by Section 760.2(d) of the EAR. In addition, the company failed to report to BIS the receipt of the request to furnish this information as required by Section 760.5 of the EAR.
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November 3, 2023: Pursuant to Section 766.24 of the Export Administration Regulations, 15 CFR Parts 730–774 (2021) (“EAR” or “the Regulations”), the Commerce Department’s Industry and Security Bureau granted the request of the Office of Export Enforcement (“OEE”) to renew the temporary denial order issued in this matter on May 5, 2023. The Bureau has found that renewal of this order, as modified, is necessary in the public interest to prevent an imminent violation of the Regulations and that renewal for an extended period is appropriate because Mahan Airways has engaged in a pattern of repeated, ongoing and/or continuous apparent violations of the EAR.
- Mahan Airways of Iran
- Pejman Mahmood Kosarayanifard, a/k/a Kosarian Fard of the United Arab Emirates
- Mahmoud Amini of the United Arab Emirates
- Kerman Aviation, a/k/a GIE Kerman Aviation of France
- Sirjanco Trading LLC of the United Arab Emirates
- Mahan Air General Trading LLC of the United Arab Emirates
- Mehdi Bahrami of Turkey
- Al Naser Airlines, a/k/a al-Naser Airlines, a/k/a Al Naser Wings Airline, a/k/a Alnaser Airlines and, Air Freight Ltd of the United Arab Emirates
- Ali Abdullah Alhay, a/k/a Ali Alhay, a/k/a Ali Abdullah Ahmed Alhay of Saudi Arabia
- Bahar Safwa General Trading of the United Arab Emirates
- Sky Blue Bird Group, a/k/a Sky Blue Bird Aviation, a/k/a Sky Blue Bird Ltd., a/k/a Sky Blue Bird FZC of the United Arab Emirates
- Issam Shammout, a/k/a Muhammad Isam Muhammad, Anwar Nur Shammout, a/k/a Issam Anwar of Turkey
https://www.federalregister.gov/d/2023-24310
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November 6, 2023: Swift Prepaid Solutions, Inc. d/b/a daVinci Payments (daVinci), a financial services and payments firm based in Buffalo Grove, Illinois, has agreed to remit $206,213 to settle its potential civil liability for 12,391 apparent violations of OFAC sanctions on Crimea, Iran, Syria, and Cuba.
Between November 15, 2017 and July 27, 2022, daVinci, which manages prepaid reward card programs, enabled reward cards to be redeemed from persons apparently resident in sanctioned jurisdictions. The settlement amount reflects OFAC’s determination that daVinci’s conduct was non-egregious and was voluntarily self-disclosed.
Between March 2020 and February 2022, in the course of a compliance review and subsequent investigation, daVinci discovered that on 12,378 occasions it had redeemed prepaid cards for users with Internet Protocol (IP) addresses associated with Iran, Syria, Cuba, and Crimea. After daVinci began preventing access to its platform from IP addresses associated with these sanctioned jurisdictions, the company further discovered it had redeemed prepaid cards for 13 card recipients who had used email addresses with suffixes (sometimes called top-level domains) associated with sanctioned jurisdictions (e.g., Syria is .sy, Iran is .ir) during the redemption process and who were apparently resident therein. Over the course of the relevant time period, this absence of comprehensive geolocation controls led daVinci to process 12,391 redemptions totaling $549,134.89 for cardholders apparently located in sanctioned jurisdictions, resulting in apparent violations of the Cuban Assets Control Regulations, 31 C.F.R. § 515.201; the Iranian Transactions and Sanctions Regulations, 31 C.F.R. 2 § 560.204; the Ukraine-/Russia-Related Sanctions Regulations, 31 C.F.R. § 589.287; and the Syrian Sanctions Regulations, 31 C.F.R. § 542.207 (the “Apparent Violations”).
This enforcement action underscores the importance of obtaining and using all available information to verify a customer’s identity or residency, including by using location-related data, such as IP address and top-level domains, for sanctions compliance purposes. As appropriate, firms providing services through online platforms should integrate such information into a risk-based sanctions compliance program to prevent the provision of services to persons in sanctioned jurisdictions. This case further demonstrates the potential shortcomings of controls that rely on customer-provided information, rather than a holistic information-gathering system that can mitigate evasion or misrepresentation. The action further highlights the value of conducting proactive, self-initiated reviews to identify compliance gaps, disclose any potential violations to OFAC, and taking steps to remediate deficiencies, including by instituting periodic independent testing to ensure adequate controls.
https://ofac.treasury.gov/media/932276/download?inline
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November 7, 2023: Matthew S. Axelrod, Assistant Secretary for Export Enforcement at the U.S. Commerce Department’s Bureau of Industry and Security (BIS), issued a Temporary Denial Order (TDO) suspending the export privileges of seven persons and three companies – Nikolay Goltsev, Salimdzhon Nasriddinov, Kristina Puzyreva, Oleg Zenchenko, Yekaterina Vetoshkina, Pavel Chernikov, Vladimir Bochkarev, SH Brothers Group Inc. (SH Brothers), SN Electronics, Inc. (SN Electronics), and Suntronic F.Z.E. (Suntronic). These ten parties are alleged to be part of a sophisticated global procurement scheme that unlawfully sourced and purchased millions of dollars in dual-use electronics for end-users in Russia, including companies affiliated with the Russian military.
These actions are related to an indictment in the Eastern District of New York and are the result of coordination by the Disruptive Technology Strike Force co-led by the Departments of Justice and Commerce and Task Force KleptoCapture. Goltsev, Nasriddinov, Puzyreva, Zenchenko, Vetoshkina, Chernikov, and Bochkarev were indicted in the Eastern District of New York on multiple charges, including conspiracy to violate the Export Control Reform Act. Goltsev, Nasriddinov and Puzyreva were previously arrested on October 31, 2023, pursuant to a criminal complaint. The actions by the Department of Commerce build on the indictment by blocking SH Brothers, SN Electronics, and Suntronic, along with the other parties to the TDO, from access to U.S. origin items and technologies.
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November 14, 2023: Pursuant to section 766.24 of the Export Administration Regulations (the “Regulations” or “EAR”), the Bureau of Industry and Security (“BIS”), U.S. Department of Commerce, through its Office of Export Enforcement (“OEE”), has requested the issuance of an Order temporarily denying, for a period of 180 days, the export privileges under the Regulations of:
- Nikolay Goltsev, a/k/a Nick Stevens, a/k/a Gio Ross of Quebec, Canada.
- Salimdzhon Nasriddinov of New York, USA
- Kristina Puzyreva of Quebec, Canada
- Vladimir Bochkarev of Russia
- Pavel Chernikov of Russia
- Yekaterina Vetoshkina of Russia
- Oleg Zenchenko of Russia
- SH Brothers Group, Inc. of New York, USA
- SN Electronics, Inc. of New York, USA
- Suntronic FZE of the United Arab Emirates
https://www.federalregister.gov/d/2023-25005
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November 21, 2023: The U.S. Department of the Treasury, through the Financial Crimes Enforcement Network (FinCEN), the Office of Foreign Assets Control (OFAC), and IRS Criminal Investigation (CI), has taken unprecedented action to hold Binance Holdings Ltd. and its affiliates (collectively, Binance) accountable for violations of the U.S. anti-money laundering (AML) and sanctions laws that protect American national security and the integrity of the international financial system. Binance is the world’s largest virtual currency exchange, responsible for an estimated 60% of centralized virtual currency spot trading.
Binance settled with FinCEN and OFAC for violations of the Bank Secrecy Act (BSA) and apparent violations of multiple sanctions programs. The violations include failure to implement programs to prevent and report suspicious transactions with terrorists — including Hamas’ Al-Qassam Brigades, Palestinian Islamic Jihad (PIJ), Al Qaeda, and the Islamic State of Iraq and Syria (ISIS) — ransomware attackers, money launderers, and other criminals, as well as matching trades between U.S. users and those in sanctioned jurisdictions like Iran, North Korea, Syria, and the Crimea region of Ukraine. By failing to comply with AML and sanctions obligations, Binance enabled a range of illicit actors to transact freely on the platform. This settlements are part of a global agreement simultaneous with Binance’s resolution of related matters with the Department of Justice (DOJ) and the Commodity Futures Trading Commission (CFTC).
FinCEN’s settlement agreement assesses a civil money penalty of $3.4 billion, imposes a five-year monitorship, and requires significant compliance undertakings, including to ensure Binance’s complete exit from the United States. OFAC’s settlement agreement assesses a penalty of $968 million and requires Binance to abide by a series of robust sanctions compliance obligations, including full cooperation with the monitorship overseen by FinCEN. To ensure that Binance fulfils the terms of its settlement — including that it does not offer services to U.S. persons — and to ensure that illicit activity is addressed, Treasury will retain access to books, records, and systems of Binance for a period of five years through a monitor. Failure to live up to these obligations could expose Binance to substantial additional penalties, including a $150 million suspended penalty, which would be collected by FinCEN if Binance fails to comply with the terms of the required compliance undertakings and monitorship.
The monitor will oversee remedial undertakings necessary to address Binance’s failure to comply with its anti-money laundering and sanctions obligations. The monitor will also conduct periodic reviews and report to FinCEN, OFAC, and the CFTC on its findings and recommendations to ensure Binance’s ongoing compliance with the terms of the settlement agreements.
These actions underscore Treasury’s commitment to promoting compliance within the virtual currency industry, including by actively enforcing AML and sanctions laws. Treasury’s authorities to enforce those laws are broad, reaching a wide range of misconduct, and can apply to both U.S. and foreign persons. Wherever located, virtual currency exchanges and financial technology firms should, like any other financial institution, ensure they adopt a managerial commitment to compliance at the very top, and that risk-based programs and controls are integrated effectively into their platforms and technology from “Day One.”
https://home.treasury.gov/news/press-releases/jy1925
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November 22, 2023: On June 23, 2022, in the U.S. District Court for the Southern District of Texas, Samantha Coronado (“Coronado”) was convicted of violating 18 U.S.C. 554(a). Specifically, Coronado was convicted of smuggling 730 rounds of CBC .50 caliber ammunition from the United States to Mexico. As a result of her conviction, the Court sentenced Coronado to 46 months of confinement, three years of supervised release and a $100 assessment.
The Bureau of Industry and Security has decided to deny Coronado’s export privileges under the Regulations for a period of seven years from the date of Coronado’s conviction. The Office of Exporter Services has also decided to revoke any BIS-issued licenses in which Coronado had an interest at the time of her conviction.
From the date of this Order until June 23, 2029, Samantha Coronado, with a last known address of Inmate Number: 83982–509, FMC Carswell, Federal Medical Center, P.O. Box 27137, Fort Worth, TX 76127, and when acting for or on her behalf, her successors, assigns, employees, agents or representatives (“the Denied Person”), may not directly or indirectly participate in any way in any transaction involving any commodity, software or technology (hereinafter collectively referred to as “item”) exported or to be exported from the United States that is subject to the Regulations.
https://www.federalregister.gov/d/2023-25838
Sanctions
U.S. Department of State
November 2, 2023: The Department of State imposed sanctions to further target individuals and entities associated with Russia’s war effort and other malign activities. All targets are being designated pursuant to Executive Order (E.O.) 14024, which authorizes sanctions with respect to specified harmful foreign activities of the Government of the Russian Federation. The Department of State designated a major entity involved in the development, operation, and ownership of Russia’s key Arctic LNG 2 liquified natural gas (LNG) project, as well as the metals and mining sector of the Russian Federation economy, and a network procuring items in support of the production of the KUB-BLA and Lancet suicide drones being used by the Russian military in Ukraine.
- Limited Liability Company Arctic LNG 2 (LLC Arctic LNG 2)
- Joint Stock Company Russian Titanium Resources (Rustitan)
- Anatoliy Nikolaevich Tkachuk
- Alexey Alexeyevich Novikov
- Russian Titanium Resources Limited
- Limited Liability Company Zala Aero
- A Level Aerosystems Cst
- Aleksandr Vyacheslavovich Zakharov
- Svetlana Nikolaevna Zakharova
- Limited Liability Company Invest Group
- Maria Aleksandrovna Osetrova
- Limited Liability Company Scientific And Technical Center Orion
- Limited Liability Company Doris
- Lavrentii Aleksandrovich Zakharov
- Nikita Aleksandrovich Zakharov
- Limited Liability Company Aeroscan
- Limited Liability Company Emergency Digital Solutions
- Limited Liability Company RTK
- Limited Liability Company Omp
- Maksim Alekseyevich Kotelnikov
- Limited Liability Company Hartis DV
- Dmitriy Alekseyevich Dmitriev
- Limited Liability Company Id Solution
- Igor Nikolaevich Ievlev
- Ooo Mvizion
- Limited Liability Company Sputnik Electronics
- Limited Liability Company Technical Center Windeq
- Limited Liability Company Alfakomponent
- Limited Liability Company Fotopark
- Limited Liability Company Bik Inform
- Limited Liability Company Nanochip
- Limited Liability Company N Chip Msk
- Limited Liability Company Sputnik Spetspostavka
- Limited Liability Company Entep
- Limited Liability Company Spetstechnotrade
- Limited Liability Company Orelmetallpolymer
- Bestop Globle Mfg Limited
- Limited Liability Company Legion Komplekt (Legion Komplekt)
- Baltelektron Limited Liability Company
- Makro Tim Limited Liability Company
- Dafeng Asia Co LLC
- Limited Liability Company Advanta Electro
- Limited Liability Company Comfort Max
- Neway Technologies Limited
- LLC Laser Components
- Limited Liability Company Scientific Production Company Electronic, Optical, And Mechanical Systems
- Limited Liability Company Stilsoft
- Limited Liability Company New Technologies
- Joint Stock Company Npc Spetsneftprodukt
- Moscow State Technical University Named After N. E. Bauman
- Limited Liability Company Machine Building Association Pressmash
- Limited Liability Company Lanmax (Lanmax)
- Dream Lite Trading LLC
- Limited Liability Company Mdikam Ek
- Bliksem Computers & Requisites Trading Company LLC
- Joint Stock Company Plastmass Plant
- Gleb Romanovich Trotsenko
- Limited Liability Company Lex Prime
- Limited Liability Company Start Aero
- Limited Liability Company Gleniks Teknolodzhis
- LLC A Invest
- Limited Liability Company Infrastructure Corporation Aeon
- Limited Liability Company Tsrti
- LLC Bp Inzhiniring
- LLC Aeon Development
- Limited Liability Company Ri2
- Limited Liability Company Yacht Club River Park Nagatino
- Limited Liability Company Rechnikov Invest
- Limited Liability Company River Park
- Limited Liability Company Yup 2
- Limited Liability Company Ksk Ltd
- Limited Liability Company Torgrechtrans
- Limited Liability Company Ahd South Port
- Limited Liability Company Rassvet
- Limited Liability Company Flemsted
- LLC Tsentrtekhkhimmash
- Qualified Developer Kutuzovskiy 16 Limited Liability Company
- Limited Liability Company Ahd Kutuzovskiy Towers
- Elena Igorevna Milskaia
- Limited Liability Company Kaliningrad Balttrans
- Limited Liability Company Pozitivinfo
- Limited Liability Company Prospekt
- Interregional Public Organization For The Promotion Of Domestic Traditions And Cultural Heritage Veche
- Salman Soipovich Zakriev
- Yakub Salmanovich Zakriev
- Public Legal Company Military Construction Company
- LLC Abz Belyi Rast
- Federal Autonomous Institution Roskapstroy
- Limited Liability Company Roskapstroy Infrastructural Projects
- Limited Liability Company Roskapstroy Clean Water
- Limited Liability Company Roskapstroy Novorossiya
- Aleksey Sergeevich Besprozvannykh
- Anastasiya Borisovna Bondarenko
- Viktor Leonidovich Evtukhov
- Oleg Yurevich Kachanov
- Dmitriy Aleksandrovich Oguryaev
- Lev Valentinovich Gershanok
- Aleksey Mikhaylovich Serko
https://www.state.gov/taking-additional-sweeping-measures-against-russia/
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U.S. Department of Commerce, Bureau of Industry and Security (BIS)
November 6, 2023: 88 FR 76128: The Bureau of Industry and Security (BIS) amended the Export Administration Regulations (EAR) by adding 13 entities to the Entity List under the destinations of Russia (12), and Uzbekistan (1). These entities have been determined by the U.S. Government to be acting contrary to the national security or foreign policy interests of the United States.
Russia
- Aeroscan Limited Liability Company;
- Alfakomponent;
- BIC-Inform LLC;
- Hartis DV LLC;
- ID Solution LLC;
- OOO OMP;
- Orelmetallpolimer LLC;
- Spel LLC;
- Spetstehnotreyd LLC;
- STC Orion LLC;
- Technical Center Windeq LLC
- ZALA Aero Group.
Uzbekistan
- Mvizion LLC.
https://www.federalregister.gov/d/2023-24508
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November 14, 2023: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued an OFAC Compliance Communiqué: Guidance for the Provision of Humanitarian Assistance to the Palestinian People in response to questions from the NGO community and the general public on how to provide humanitarian assistance while complying with OFAC sanctions.
OFAC issued this guidance to clarify that U.S. sanctions do not stand in the way of legitimate humanitarian assistance to the Palestinian people. Donors seeking to support the Palestinian people are encouraged to donate to trusted organizations.
https://ofac.treasury.gov/media/932311/download?inline
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November 17, 2023: 88 FR 80955: The Bureau of Industry and Security (BIS) amended the Export Administration Regulations (EAR) by adding four entities under nine entries to the Entity List. These entities are listed under the destinations of Costa Rica (1), Ecuador (1), India (1) Panama (2), Spain (1), Russia (1), and Venezuela (2). These entities have been determined by the U.S. Government to be acting contrary to the national security or foreign policy interests of the United States.
The End-User Review Committee (ERC) determined to add Aerofalcon S.L., under the destination of Spain; Novax Group S.A., under the destinations of Costa Rica, Ecuador, Panama, Venezuela, and Russia; and Zero Waste Global SA, under the destinations of Panama and Venezuela, to the Entity List. These entities are added to the Entity List pursuant to § 744.11 of the EAR for engaging in activities contrary to U.S. national security and foreign policy interests. Specifically, these entities were used by their principals to circumvent U.S. sanctions, supplying the representatives of Nicolás Maduro in Venezuela with U.S. origin aircraft parts. This circumvention was conducted by, among other efforts, concealing the true end user and end destination of the exports using misrepresentations and fraudulent documents, including the filing of false Electronic Export Information. These entities will be added with a license requirement for all items subject to the EAR and a license review policy of presumption of denial.
The ERC also determined to add Si2 Microsystems Private Limited, under the destination of India, to the Entity List. This entity is added to the Entity List for providing support to Russia’s military and/or defense industrial base. Specifically, this entity supplied Russian consignees connected to the Russian defense sector with U.S.-origin integrated circuits after March 1, 2023. These integrated circuits are classified under Harmonized Tariff System (HTS)-6 codes 854231, 854232, 854233, and/or 854239. These HTS–6 codes are identified under supplement no. 4 to part 746 (Russian and Belarusian Industry Sector Sanctions Pursuant to § 746.5(a)(1)(ii)). All U.S.-origin items classified under these HTS–6 codes have been controlled for export and reexport and transfer within Russia since September 15, 2022. Such U.S.-origin items require a license under § 746.5(a)(1)(ii) of the EAR when destined to Russia or Belarus. Therefore, the documented shipments by this entity to Russia of such U.S.-origin items are contrary to U.S. national security and foreign policy interests under § 744.11(b) of the EAR. This entity will be added with a license requirement for all items subject to the EAR and a license review policy of denial.
Costa Rica
- Novax Group S.A.
Ecuador
- Novax Group S.A.
India
- Si2 Microsystems Private Limited.
Panama
- Novax Group S.A.;
- Zero Waste Global SA.
Spain
- Aerofalcon S.L.
Russia
- Novax Group S.A.
Venezuela
- Novax Group S.A.;
- Zero Waste Global SA.
https://www.federalregister.gov/d/2023-25684
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Department of the Treasury, Office of Foreign Assets Control (OFAC)
November 2, 2023: OFAC Issued General License 13G: “Authorizing Certain Administrative Transactions Prohibited by Directive 4 under Executive Order 14024”.
General License 13G: U.S. persons, or entities owned or controlled, directly or indirectly, by a U.S. person, are authorized to pay taxes, fees, or import duties, and purchase or receive permits, licenses, registrations, certifications, or tax refunds to the extent such transactions are prohibited by Directive 4 under Executive Order 14024, Prohibitions Related to Transactions Involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation, provided such transactions are ordinarily incident and necessary to the day-to-day operations in the Russian Federation of such U.S. persons or entities, through 12:01 a.m. eastern standard time, January 31, 2024.
This General License 13G does not authorize: (1) Any debit to an account on the books of a U.S. financial institution of the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation; or (2) Any transactions otherwise prohibited by the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587 (RuHSR), including transactions involving any person blocked pursuant to the RuHSR, unless separately authorized.
Effective November 2, 2023, General License No. 13F, dated August 10, 2023, is replaced and superseded in its entirety by this General License No. 13G
https://ofac.treasury.gov/media/932271/download?inline
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November 2, 2023: OFAC Issued General License 74: “Authorizing the Wind Down and Rejection of Transactions Involving East-West United Bank”.
General License 74: All transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to the wind down of transactions involving East-West United Bank, or any entity in which East-West United Bank owns, directly or indirectly, a 50 percent or greater interest, are authorized through 12:01 a.m. eastern standard time, January 31, 2024, provided that any payment to a blocked person is made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587 (RuHSR).
Except as provided in this General License 74, U.S. persons are authorized to reject, rather than block, and return to the originator or originating financial institution or their successor-in-interest, all transactions prohibited by E.O. 14024 that are ordinarily incident and necessary to the processing of funds involving East-West United Bank, or any entity in which East-West United Bank owns, directly or indirectly, a 50 percent or greater interest, as an originating, intermediary, or beneficiary financial institution, through 12:01 a.m. eastern standard time, January 31, 2024.
This general license does not authorize: (1) Any transactions prohibited by Directive 2 under E.O. 14024, Prohibitions Related to Correspondent or Payable-Through Accounts and Processing of Transactions Involving Certain Foreign Financial Institutions; (2) Any debit to an account on the books of a U.S. financial institution of the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation; or (3) Any transactions otherwise prohibited by the RuHSR, including transactions involving any person blocked pursuant to the RuHSR other than the blocked persons described in this General License 74, unless separately authorized.
https://ofac.treasury.gov/media/932256/download?inline
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November 2, 2023: OFAC Issued General License 75: “Authorizing Certain Transactions Related to Debt or Equity of, or Derivative Contracts Involving, Certain Entities Blocked on November 2, 2023”.
General License 75: All transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to the divestment or transfer, or the facilitation of the divestment or transfer, of debt or equity of the following blocked entities (“Covered Debt or Equity”) to a non-U.S. person are authorized through 12:01 a.m. eastern standard time, January 31, 2024: (1) Sistema Public Joint Stock Financial Corporation; (2) East-West United Bank; (3) Limited Liability Company Arctic LNG 2; or (4) Any entity in which one or more of the above persons own, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest.
Except as provided in this general license, all transactions prohibited by E.O. 14024 that are ordinarily incident and necessary to facilitating, clearing, and settling trades of Covered Debt or Equity that were placed prior to 4:00 p.m. eastern daylight time, November 2, 2023 are authorized through 12:01 a.m. eastern standard time, January 31, 2024.
Except as provided in this General License 75 , all transactions prohibited by E.O. 14024 that are ordinarily incident and necessary to the wind down of derivative contracts entered into prior to 4:00 p.m. eastern standard time, November 2, 2023 that (i) include a blocked person described in this general license as a counterparty or (ii) are linked to Covered Debt or Equity are authorized through 12:01 a.m. eastern standard time, January 31, 2024, provided that any payments to a blocked person are made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587 (RuHSR).
This general license does not authorize: (1) U.S. persons to sell, or to facilitate the sale of, Covered Debt or Equity to, directly or indirectly, any person whose property and interests in property are blocked; or (2) U.S. persons to purchase or invest in, or to facilitate the purchase of or investment in, directly or indirectly, Covered Debt or Equity, other than purchases of or investments in Covered Debt or Equity ordinarily incident and necessary to the divestment or transfer of Covered Debt or Equity as described in thisgeneral license.
This general license does not authorize: (1) Any transactions prohibited by Directive 2 under E.O. 14024, Prohibitions Related to Correspondent or Payable-Through Accounts and Processing of Transactions Involving Certain Foreign Financial Institutions; (2) Any transactions prohibited by Directive 4 under E.O. 14024, Prohibitions Related to Transactions Involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation; or (3) Any transactions otherwise prohibited by the RuHSR, including transactions involving any person blocked pursuant to the RuHSR other than the blocked persons described in this general license, unless separately authorized.
https://ofac.treasury.gov/media/932261/download?inline
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November 2, 2023: OFAC Issued General License 76: “Authorizing the Wind Down of Transactions Involving Certain Entities Blocked on November 2, 2023”.
General License 76: All transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to the wind down of any transaction involving one or more of the following blocked entities (collectively, the “Blocked Entities”) are authorized through 12:01 a.m. eastern standard time, January 31, 2024, provided that any payment to a Blocked Entity is made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587 (RuHSR): (1) Sistema Public Joint Stock Financial Corporation; (2) Saint Petersburg Stock Exchange; (3) Limited Liability Company Arctic LNG 2; or (4) Any entity in which one or more of the above persons own, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest.
This general license does not authorize: (1) Any transactions prohibited by Directive 2 under E.O. 14024, Prohibitions Related to Correspondent or Payable-Through Accounts and Processing of Transactions Involving Certain Foreign Financial Institutions; (2) Any transactions prohibited by Directive 4 under E.O. 14024, Prohibitions Related to Transactions Involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation; or (3) Any transactions otherwise prohibited by the RuHSR, including transactions involving any person blocked pursuant to the RuHSR other than the Blocked Entities described in this general license, unless separately authorized.
https://ofac.treasury.gov/media/932266/download?inline
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November 3, 2023: The Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Ekaterina Zhdanova, a Russian national, for her role in laundering and moving funds using virtual currency on behalf of Russian elites. This action is consistent with the G7’s commitment to crack down on sanctions evasion and closing loopholes that allow the Russian state, its elites, proxies, and oligarchs to leverage virtual currency to offset the impact of international sanctions.
In response to Russia’s illegal invasion of Ukraine in February 2022, OFAC has imposed expansive economic sanctions on the Russian financial system. In March 2022, Ekaterina Zhdanova (Zhdanova) assisted a Russian client in obfuscating their source of wealth in order to transfer over $2.3 million into Western Europe through a fraudulently opened investment account and real estate purchases. Zhdanova’s services result in the provision of access to Western financial markets for Russian individuals that may otherwise be blocked due to U.S. and international prohibitions. This type of illicit financial activity can be used to evade the multilateral U.S. and international sanctions that impose costs on Russia for its unprovoked war and deny the access of sanctioned Russian individuals and entities to the international financial system.
Zhdanova has also provided services to individuals connected with the Russian Ryuk ransomware group. In 2021, Zhdanova laundered over $2.3 million of suspected victim payments on behalf of a Ryuk ransomware affiliate. Ryuk has been used to target thousands of victims worldwide, including in the United States, across a variety of sectors. In October 2022, U.S. law enforcement specifically identified Ryuk as an imminent and increasing cybercrime threat to hospitals and healthcare providers in the United States.
https://home.treasury.gov/news/press-releases/jy1874
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November 7, 2023: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned 13 Sinaloa Cartel members—several of whom are fugitives—and four Sonora, Mexico-based entities. Responsible for a significant portion of the illicit fentanyl and other deadly drugs trafficked into the United States, the Sinaloa Cartel is one of the most powerful and pervasive drug trafficking organizations in the world. This action was coordinated closely with the Government of Mexico, including La Unidad de Inteligencia Financiera (UIF), Mexico’s Financial Intelligence Unit.
- Juan Carlos Morgan Huerta
- Jose Arnoldo Morgan Huerta
- Jose Luis Morgan Huerta
- Miguel Angel Morgan Huerta
- Martin Morgan Huerta
- Oscar Murillo Morgan
- David Alonso Chavarin Preciado
- Jesus Francisco Camacho Porchas
- Oscar Enrique Moreno Orozco
- Ramiro Martin Romero Wirichaga
- Cristian Julian Meneses Ospina
- Sergio Isaias Hernandez Mazon
- Alvaro Ramos Acosta
- Conceptos Gastronomicos de Sonora, S. de R.L. de C.V.
- Morgan Golden Mining, S.A. de C.V.
- Comercializadora Villba Stone, S.A. de C.V.
- Exportadora del Campos Ramos Acosta, S. de R.L. de C.V.
https://home.treasury.gov/news/press-releases/jy1887
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OFAC Issued General License 76A: “Authorizing the Wind Down of Transactions Involving Certain Entities Blocked on November 2, 2023”.
November 8, 2023: All transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to the wind down of any transaction involving one or more of the following blocked entities (collectively, the “Blocked Entities”) are authorized through 12:01 a.m. eastern standard time, January 31, 2024, provided that any payment to a Blocked Entity is made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions Regulations, 31 CFR part 587 (RuHSR): (1) Sistema Public Joint Stock Financial Corporation; (2) Public Joint Stock Company Saint Petersburg Exchange; (3) Limited Liability Company Arctic LNG 2; or (4) Any entity in which one or more of the above persons own, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest.
This general license does not authorize any transactions prohibited by Directive 2 under E.O. 14024, Prohibitions Related to Correspondent or Payable-Through Accounts and Processing of Transactions Involving Certain Foreign Financial Institutions; Any transactions prohibited by Directive 4 under E.O. 14024, Prohibitions Related to Transactions Involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation; or any transactions otherwise prohibited by the RuHSR, including transactions involving any person blocked pursuant to the RuHSR other than the Blocked Entities described in this General License 76A, unless separately authorized.
Effective November 8, 2023, General License No. 76, dated November 2, 2023, has been replaced and superseded in its entirety by this General License No. 76A.
https://ofac.treasury.gov/media/932286/download?inline
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November 14, 2023: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) imposed its third round of sanctions targeting Hamas-affiliated individuals and entities since the October 7 Hamas terrorist attacks on Israel. The action designates key Hamas officials and the mechanisms by which Iran provides support to Hamas and Palestinian Islamic Jihad (PIJ). The designations are coordinated with action by the U.K. and are aimed at protecting the international financial system from abuse by Hamas and their enablers.
- Nasser Abu Sharif
- Muhjat AlQuds Foundation
- Jamil Yusuf Ahmad ‘Aliyan
- Akram al-Ajouri
- Nabil Chouman & Co
- Nabil Khaled Halil Chouman
- Khaled Chouman
- Reda Ali Khamis
- Mahmoud Khaled Zahhar
- Mu’ad Ibrahim Muhammed Rashid al-Atili
https://ofac.treasury.gov/recent-actions/20231114_33
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November 14, 2023: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued the OFAC Compliance Communiqué: Guidance for the Provision of Humanitarian Assistance to the Palestinian People in response to questions from the NGO community and the general public on how to provide humanitarian assistance while complying with OFAC sanctions.
The U.S. Department of the Treasury remains committed to denying Hamas access to funds following its heinous terrorist attacks against the people of Israel, while also ensuring legitimate humanitarian aid can continue to flow to the Palestinian people in Gaza. The Office of Foreign Assets Control (OFAC) has continued to use sanctions to degrade and disrupt Hamas’s fundraising network and is working with partners and allies around the globe to combat terrorist financing. Groups such as Hamas raise funds through entities that present themselves outwardly as legitimate charities but are in fact fronts for Hamas’s illicit fundraising, often abusing the good will of donors. OFAC will continue using the tools and authorities at its disposal to sever Hamas’s illicit fundraising avenues.
OFAC is issuing this guidance to clarify that U.S. sanctions do not stand in the way of legitimate humanitarian assistance to the Palestinian people. Donors seeking to support the Palestinian people are encouraged to donate to trusted organizations.
https://ofac.treasury.gov/media/932311/download?inline
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November 15, 2023: In support of President Biden’s National Drug Control Strategy and in cooperation with the government of Costa Rica, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) is designating a Costa Rican narcotics trafficker, known not only for the volume of drugs he moves but the violence with which he operates, who has played a significant role in Costa Rica’s recent transformation into a major narcotics transit hub.
According to the State Department’s 2023 International Narcotics Control Strategy Report, Costa Rica has a growing domestic drug consumption problem, as drugs warehoused in Costa Rica increasingly enter the local market and domestic criminal organizations gain influence with increased narcotics revenues. The national homicide rate rose from 11.2 per 100,000 inhabitants in 2021 to 12.6 per 100,000 inhabitants in 2022. The homicide rate in the province of Limon is 35.8 per 100,000 inhabitants. Despite these challenges, Costa Rica works closely with the United States to professionalize police, strengthen citizen security, and increase drug interdictions. However, resource limitations strain Costa Rican law enforcement services and pose significant challenges to future success. This action is the result of close collaboration with the U.S. Drug Enforcement Administration’s Costa Rica Country Office.
- Gilbert Hernan de Los Angeles Bell Fernandez
https://ofac.treasury.gov/recent-actions/20231115
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OFAC Issued General License 77: “Authorizing Limited Safety and Environmental Transactions Involving Certain Persons or Vessels”.
November 16, 2023: All transactions prohibited by Executive Order (E.O.) 14024 that are ordinarily incident and necessary to one of the following activities involving the blocked persons or vessels described in this general license are authorized through 12:01 a.m. eastern standard time, February 14, 2024, provided that any payment to a blocked person must be made into a blocked account in accordance with the Russian Harmful Foreign Activities Sanctions Regulations (RuHSR): (1) The safe docking and anchoring of any of the blocked vessels listed in this General License 77 (“blocked vessels”) in port; (2) The preservation of the health or safety of the crew of any of the blocked vessels; or (3) Emergency repairs of any of the blocked vessels or environmental mitigation or protection activities relating to any of the blocked vessels.
The authorizations in this General License 77 apply to the following blocked persons and vessels listed on the Office of Foreign Assets Control’s Specially Designated Nationals and Blocked Persons List and any entity in which any of the following persons own, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest:
- Kazan Shipping Incorporated (registered owner of KAZAN, IMO 9258002);
- Progress Shipping Company Limited (registered owner of LIGOVSKY PROSPECT, IMO 9256066); or
- Gallion Navigation Incorporated (registered owner of NS CENTURY, IMO 9306782).
This General License 77 does not authorize: The entry into any new commercial contracts involving the property or interests in property of any blocked persons, including the blocked entities and vessels described in this General License 77, except as otherwise authorized; The offloading of any cargo onboard any of the blocked vessels, including the offloading of crude oil or petroleum products of Russian Federation origin, except for the offloading of cargo that is ordinarily incident and necessary to address vessel emergencies authorized pursuant to this General License 77; Any transactions related to the sale of crude oil or petroleum products of Russian Federation origin; Any transactions prohibited by Directive 2 under E.O. 14024, Prohibitions Related to Correspondent or Payable-Through Accounts and Processing of Transactions Involving Certain Foreign Financial Institutions; Any transactions prohibited by Directive 4 under E.O. 14024, Prohibitions Related to Transactions Involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation; or Any transactions otherwise prohibited by the RuHSR, including transactions involving the property or interests in property of any person blocked pursuant to the RuHSR, other than transactions involving the blocked persons or vessels in this General License 77, unless separately authorized.
https://ofac.treasury.gov/media/932336/download?inline
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OFAC Issued General License 2: “Authorizing the Wind Down of Transactions Involving Orka Holding AD”.
November 16, 2023: All transactions prohibited by the Western Balkans Stabilization Regulations (WBSR), 31 CFR part 588, that are ordinarily incident and necessary to the wind down of any transaction involving Orka Holding AD, or any entity in which Orka Holding AD owns, directly or indirectly, a 50 percent or greater interest, are authorized through 12:01 a.m. eastern daylight time, March 15, 2024, provided that any payment to a blocked person is made into a blocked account in accordance with the WBSR.
This General License 2 does not authorize any transactions otherwise prohibited by the WBSR, including transactions involving any person blocked pursuant to the WBSR other than the blocked persons described in this general license, unless separately authorized.
https://ofac.treasury.gov/media/932326/download?inline
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OFAC Issued General License 3: “Authorizing Certain Transactions Related to Agricultural Commodities,
Medicine, Medical Devices, Replacement Parts and Components, Software Updates, or Medical Prevention, Diagnosis, or Treatment, or Clinical Trials Involving Orka Holding AD”.
November 16, 2023: All transactions prohibited by the Western Balkans Stabilization Regulations (WBSR), 31 CFR part 588, involving Orka Holding AD, or any entity in which Orka Holding AD owns, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest, related to the following are authorized: (1) the production, manufacturing, sale, transport, or provision of agricultural commodities, agricultural equipment, medicine, medical devices, replacement parts and components for medical devices, or software updates for medical devices; (2) the prevention, diagnosis, or treatment of any disease or medical condition; or (3) the conducting of clinical trials or other medical research.
For the purposes of this General License 3, agricultural commodities, medicine, and medical devices are defined as follows:
- Agricultural commodities. Agricultural commodities are products that fall within the term “agricultural commodity” as defined in section 102 of the Agricultural Trade Act of 1978 (7 U.S.C. 5602) and are intended for use as:
- Food for humans (including raw, processed, and packaged foods; live animals; vitamins and minerals; food additives or supplements; and bottled drinking water) or animals (including animal feeds);
- Seeds for food crops;
- Fertilizers or organic fertilizers; or
- Reproductive materials (such as live animals, fertilized eggs, embryos, and semen) for the production of food animals.
- Medicine. Medicine is an item that falls within the definition of the term “drug” in section 201 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 321).
- Medical devices. A medical device is an item that falls within the definition of “device” in section 201 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 321).
This general license does not authorize any transactions otherwise prohibited by the WBSR, including transactions involving any person blocked pursuant to the WBSR other than the blocked persons described in this General License 3, unless separately authorized.
Note to General License No. 3. Nothing in this general license relieves any person from compliance with any other Federal laws or requirements of other Federal agencies.
https://ofac.treasury.gov/media/932331/download?inline
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November 16, 2023: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) is imposing sanctions on three entities and identifying as blocked property three vessels that used Price Cap Coalition service providers while carrying Russian crude oil above the Coalition-agreed price cap. This action underscores Treasury’s commitment, alongside its international partners, to responsibly reducing oil revenues that the Russian government can use to bankroll its invasion of Ukraine.
The United States is part of an international coalition of countries (the Price Cap Coalition), including the G7, the European Union, and Australia, that have agreed to prohibit the import of crude oil and petroleum products of Russian Federation origin. These countries, home to many best-in-class financial and professional services, have also agreed to restrict a broad range of services related to the maritime transport of crude oil and petroleum products of Russian Federation origin—unless that oil is bought and sold at or below the specific price caps established by the Coalition or is authorized by a license. This policy is known as the “price cap.” The price cap is intended to maintain a reliable supply of crude oil and petroleum products to the global market while reducing the revenues the Russian Federation earns from oil after its own war of choice against Ukraine inflated global energy prices.
On October 12, 2023, the Price Cap Coalition published a Coalition Advisory for the Maritime Oil Industry and Related Sectors (“the Advisory”). The Advisory, which is directed at both government and private sector actors involved in the maritime trade of crude oil and refined petroleum products, provides recommendations concerning specific best practices and reflects our commitment to promoting responsible practices in the industry, preventing and disrupting sanctioned trade, and enhancing compliance with the price cap.
- Kazan Shipping Incorporated
- Progress Shipping Company Limited
- Gallion Navigation Incorporated
https://home.treasury.gov/news/press-releases/jy1915
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November 16, 2023: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated eight individuals and six entities pursuant to Western Balkans-related Executive Order (E.O.) 14033 and Russia-related E.O. 14024.
Bosnia and Herzegovina
- Savo Cvijetinovic
- BN Inzinjering
- Petar Djokic
Montenegro
- Miodrag “Daka” Davidovic
- Branislav “Brano” Micunovic
North Macedonia
- Sergey Samsonenko
- Irina Samsonenko
- Ratka Kunoska Kamceva
- Kamchev Konsalting Skopje DOOEL
- Orka Fajnans Skopje DOOEL
- Orka Holding AD
- Sistina Lajf Kear Sentar Skopje DOOEL
- Bet City International DOO Skopje
Serbia
- Nenad Popovic
- Asset Electro LLC
- Asset Automation LLC
- Mosen Esset Menedzhment LLC
Russia
- Joint Stock Company All-Russian Scientific Research Design and Technological Institute of Relay Engineering with Experimental Production
- VNIIR Promelektro LLC
- ABS Electrotekhnika LLC
- VNIIR Gidroelektroavtomatika JSC
- JSC VNIIR Progress
- VNIIR Transstroi LLC
- JSC ABS ZEiM Automation
- Dominion Tverskaya Yaroslavskaya LLC
- Dominion Nikolski LLC
https://home.treasury.gov/news/press-releases/jy1916
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OFAC Issued General License 77: “Authorizing Certain Transactions Related to Agricultural Commodities, Medicine, Medical Devices, Replacement Parts and Components, Software Updates, or Medical Prevention, Diagnosis, or Treatment, or Clinical Trials Involving Orka Holding AD”.
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November 17, 2023: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) is designating six individuals affiliated with the Iran-aligned militia group (IAMG) Kata’ib Hizballah (KH) based in Iraq. Trained, funded, and supported by Iran’s Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF), KH is behind a spate of recent attacks against the United States and partners in Iraq and Syria following the horrific attacks by Hamas against Israel. The U.S. Department of State is also designating Kata’ib Sayyid al-Shuhada (KSS) and KSS leader Hashim Finyan Rahim al-Saraji. KSS, another Iraq-based IAMG that receives support from the IRGC, has planned and been involved in attacks against U.S. personnel in Iraq and Syria.
- Imad Naji al-Bahadli
- Habib Hasan Mughamis Darraji
- Ja’afar al-Husayni
- Khalid Kadhim Jasim al-Skeni
- Basim Mohammad Hasab al-Majidi
- Mojtaba Jahandust
https://home.treasury.gov/news/press-releases/jy1921
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November 29, 2023: The Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned over 20 individuals and entities for their involvement in financial facilitation networks for the benefit of Iran’s Ministry of Defense and Armed Forces Logistics (MODAFL) and Iranian Armed Forces General Staff (AFGS), and the Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF). Iran generates the equivalent of billions of dollars via commodity sales to fund its destabilizing regional activities and support of multiple regional proxy groups, including Hamas and Hizballah. MODAFL, the AFGS and the IRGC-QF utilize intricate networks of foreign-based front companies and brokers to enable these illicit commercial activities and exploit the international financial system.
Iran
- Sepehr Energy Jahan Nama Pars Company
- Majid A’zami
- Elyas Niroomand Toomaj
- Pishro Tejarat Sana Company
- Seyyed Abdoljavad Alavi
Hong Kong
- Puyuan Trade Co., Limited
- HK Sihang Haochen Trading Limited
United Arab Emirates
- Unique Performance General Trading L.L.C
- OPG Global General Trading Co. L.L.C
- JEP Petrochemical Trading L.L.C
- Future Energy Trading L.L.C
- Tetis Global FZE
- Royal Shell Goods Wholesalers L.L.C
- A Three Energy FZE
- Transmart DMCC
- Zabi Vahap
- Adelina Kuliyeva
- Mehboob Thachankandy Palikandy
- Solise Energy
Singapore
- MSE Overseas PTE. Ltd.
- Sealink Overseas PTE. Ltd.
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November 30, 2023: In coordination with foreign partners, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned eight foreign-based Democratic People’s Republic of Korea’s (DPRK) agents that facilitate sanctions evasion, including revenue generation and missile-related technology procurement that support the DPRK’s weapons of mass destruction (WMD) programs. Additionally, OFAC sanctioned cyber espionage group Kimsuky for gathering intelligence to support the DPRK’s strategic objectives.
These actions are in response to the DPRK’s November 21 claimed military reconnaissance satellite launch and demonstrates the multilateral efforts of the United States and foreign partners to hinder the DPRK’s ability to generate revenue, procure materiel, and gather intelligence that advances the development of its WMD program and the unlawful export of arms and related materiel from the DPRK.
- Kang Kyong Il
- Ri Sung Il
- Kang Phyong Guk
- So Myong
- Choe Un Hyok
- Jang Myong Chol
- Choe Song Chol
- Im Song Sun
- Kimsuky
https://home.treasury.gov/news/press-releases/jy1938
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November 30, 2023: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned three Mexican individuals and 13 Mexican companies. These individuals and companies are linked, directly or indirectly, to timeshare fraud led by the Cartel de Jalisco Nueva Generacion (CJNG). CJNG, a violent Mexico-based organization, traffics a significant proportion of the illicit fentanyl and other deadly drugs that enter the United States. OFAC coordinated this action with the Government of Mexico, including its Financial Intelligence Unit, as well as U.S. Government partners, including the Federal Bureau of Investigation (FBI), and the Drug Enforcement Administration.
- Teresa De Jesus Alvarado Rubio
- Manuel Alejandro Foubert Cadena
- Gabriela Del Villar Contreras
- Grupo Empresarial Epta, S.A. de C.V.
- Assis Realty And Vacation Club, S.A. de C.V.
- Axis Sale & Maintenance Buildings, S.A. de C.V.
- Comercializadora de Servicios Turisticos de Vallarta, S.A. de C.V.
- Condos & Vacations Buildings Sale & Maintenance, S.A. de C.V.
- Grupo Minera Barro Pacifico, S.A.P.I. de C.V.
- International Realty & Maintenance, S.A. de C.V.
- Mega Comercial Ferrelectrica, S.A. de C.V.
- Real Estates & Holiday Cities, S.A. de C.V.
- Terra Minas e Inversiones del Pacifico, S.A.P.I. de C.V.
- Banlu Comercializadora, S.A. de C.V.
- Crowlands, S.A. de C.V.
- Skairu, S.A. de C.V.