OFAC

The Office of Foreign Assets Control fined a New York online money transmitter and provider more than $1.4 million for violating U.S. sanctions on the Crimea region of Ukraine, Iran, Sudan and Syria. Payoneer came to a settlement agreement with OFAC after illegally processing more than 2,000 payments for parties in sanctioned countries, OFAC said in a July notice. The fine was OFAC’s third highest this year.

The Office of Foreign Assets Control sanctioned a senior Cuban official and a government agency for their involvement in the repression of pro-democratic protests on the island this month, OFAC said July 22. The designations target Alvaro Lopez Miera, the Cuban defense minister, and the Brigada Especial Nacional del Ministerio del Interior (also known as the Boinas Negras or the Black Berets). “This is just the beginning,” President Joe Biden said in a July 22 statement. “The United States will continue to sanction individuals responsible for oppression of the Cuban people.”

The Commerce and Treasury departments fined a Dubai energy equipment supplier and its U.S. affiliate more than $430,000 for illegally exporting goods to Iran, the agencies said July 19. The U.S. fined Dubai-based Alfa Laval Middle East (AL Middle East) $415,695 for exporting Gamajet brand storage tank cleaning units from the U.S. to Iran and fined Virginia-based Alfa Laval (AL U.S.) $16,875 because its subsidiary referred an Iranian “business opportunity” to AL Middle East, according to enforcement orders issued this week.

The U.S. released an advisory to highlight the sanctions and export controls risks for companies doing business in Hong Kong and announced a new set of Hong Kong designations July 16. The advisory, issued by the State, Treasury, Commerce and Homeland Security departments, describes “considerations” for businesses operating in “this new legal landscape,” which includes several sanctions regimes targeting Beijing and Hong Kong.

A shift toward list-based sanctions and a rise in federal government compliance expectations are causing increasing challenges for the compliance community, compliance professionals said. At the center of those challenges are the designations imposed by the Treasury Department’s Office of Foreign Assets Control, which is setting a high bar for due diligence by more clearly describing its compliance expectations in settlement agreements.

The U.S. and several allies announced a host of new sanctions against people and entities responsible for the Belarusian government’s disputed 2020 presidential election and recent human rights abuses. The sanctions, coordinated with Canada, the European Union and the United Kingdom, also target Belarus and President Alexander Lukashenko’s government for the forced diversion of a commercial plane last month to arrest a journalist, the U.S. Treasury and State Department said June 21. Treasury’s Office of Foreign Assets Control also issued a new general license to authorize certain transactions with Belarus and published additional sanctions guidance.

Sanctions compliance is increasingly presenting challenges to companies around the world as more countries turn to sanctions as a foreign policy tool, Baker McKenzie lawyers said. Some recent challenges include the growing emphasis on sanctions enforcement and the due diligence issues presented by countries with little publicly available information on ownership chains, the lawyers said.

President Joe Biden’s nominee to be the State Department’s assistant secretary for Western hemisphere affairs vowed to aggressively sanction human rights violators and said more can be done to stop sanctions evasion tactics. The nominee, Brian Nichols, also told the Senate Foreign Relations Committee May 19 that the agency should coordinate closely with the Treasury Department and voiced support for some of the agency’s Cuba restrictions.

Forwarders are seeing a rise in maximum penalties issued by CBP for violations surrounding ocean shipments that occurred over a year ago, National Customs Brokers & Forwarders Association of America officials said. Joe Brogan, the chair of NCBFAA’s export compliance subcommittee, said CBP officers are increasingly digging up old violations where forwarders submitted incorrect transportation-related information, such as the date of export or the port of export, and have levied penalties higher than $14,000 for a “single occurrence.”

President Joe Biden signed a sweeping executive order authorizing new sanctions against Russia, allowing the U.S. to designate people and companies operating in Russia’s defense and technology sectors or involved in attempts to influence foreign elections. The order, announced April 15, also authorizes sanctions against a range of Russian government officials and their associates as well as people and companies involved in Russian corruption, actions to “undermine democratic processes,” and human rights violations and transactions designed to circumvent U.S. sanctions.