Prosecutors in the US are reported to be moving forwards with their investigation into alleged sanctions violations committed by Deutsche Boerse AG and its Luxembourg-based subsidiary Clearstream Banking SA. Clearstream is alleged to have acted as an intermediary between Iran’s Central Bank and JPMorgan by receiving interest payments and redemptions into its JPMorgan account on $1.67bn of bonds held on behalf of an Italian bank that was acting as a front for Iran’s Central Bank. There is no indication that JPMorgan knew the accounts were linked to Iran.
The prosecutors are said to be considering whether to charge Clearstream with violating US sanctions and making false statements to US regulators. If they find that Clearstream’s management knowingly withheld information, they may bring charges against individuals.
The EU has renewed the listings of the 7 people and 1 entity targeted by its Zimbabwe sanctions for a further year, until 20 February 2018. Currently the sanctions are suspended in respect of all listed people and entities except for Robert Mugabe, Grace Mugabe, and Zimbabwe Defence Industries. See Council Decision 2017/288 amending Council Decision 2011/101/CFSP and the EU’s notices here and here.
It has also introduced an exception to its arms embargo on Zimbabwe, allowing for the export of certain explosive substances where they are solely for use in Zimbabwe’s civilian mining and infrastructure projects. See Council Regulation 2017/284 amending Council Regulation 314/2004 and Council Decision 2017/288 amending Council Decision 2011/101/CFSP.
The General Court of the EU has rejected another challenge to the re-listing of entities after they have won their annulments challenging their initial listing on the EU’s Iran sanctions; Islamic Republic of Iran Shipping Lines v Council (link to the judgment is here). The Court has held that the Council was entitled not only to re-list IRISL and some companies said to be connected with it, but that it could introduce new listing criteria that expressly target IRISL-connected companies after IRISL’s designation had been annulled (on which see previous blog). The judgment contains interesting comments on the probative value of witness evidence and the credibility and source of evidence. Maya Lester QC acted for the applicants.
Amazon has announced that it may have violated US sanctions on Iran by processing and delivering orders of consumer products to sanctioned people and entities located outside Iran. Amazon voluntarily reported the possible violations, and has said that it will cooperate with an investigation by US regulators. It has also said it will enhance its processes designated to identify transactions associated with people designated under the Iran Threat Reduction and Syria Human Rights Act 2012.
OFAC has designated Venezuela’s Executive Vice President, Tareck El Aissami, as a Specially Designated Narcotics Trafficker. He is said to have facilitated shipments of narcotics from Venezuela, and in previous positions to have overseen narcotics shipments from Venezuela of over 1000kg on multiple occasions. His primary frontman Samark Lopez Bello has also been designated as an SDNT, along with his international network of companies, for his role in laundering drug proceeds and generating significant illicit profits on behalf of El Aissami. The details are here, and OFAC’s press release is here.
The US Treasury has increased the maximum civil penalties that may be imposed under relevant OFAC sanctions regimes to account for inflation. The increases are effective from today, and are set out in full here.
The EU has published a notice for the attention of Mohamed and Amir Garrana, both listed on its sanctions against those said to have misappropriated Egyptian state funds, informing them that it holds new information on file concerning them. They may write to the Council to obtain the information relating to them before 13 February 2017.
OFAC has issued a Finding of Violation to B Whale Corporation (BWC), a shipping company based in Taiwan and member of the TMT Group of Shipping Companies, for violating US sanctions on Iran. The violation occurred when BWC’s vessel, the M/V B Whale, transferred 2,086,486 barrels of crude oil from a vessel owned by the National Iranian Tanker Company, which is identified on OFAC’s SDN List. OFAC’s enforcement notice is here.
The transaction took place while BWC was involved in bankruptcy proceedings in the US. OFAC determined that BWC was a US person within the scope of its sanctions on Iran because it was present in the US for those proceedings when the transaction occurred. In addition, the vessel B Whale was subject to US sanctions because it was property under the jurisdiction of a US court, and therefore the transfer of oil constituted an import from Iran to the US.
OFAC’s found BWC’s conduct to have been aggravated by its reckless disregard for US sanctions, attempts to conceal the transfer, and the significant benefit provided by the transaction to Iran, but mitigated by its clean sanctions record and the fact that all of its assets had been liquidated in bankruptcy.