Alexander Brazhnikov Jr, a US citizen, has been sentenced to 70 months’ imprisonment in the USA for his role in an international procurement network that obtained and smuggled more than $65million of electronics from the USA to Russia, in breach of export controls. He is said to have concealed the identity of the end-user and value of the goods in order to avoid having to fill out export control forms, and used shell addresses in Russia, including vacant storefronts and apartments, to obscure their destination. Payments for the goods were made to Mr Brazhnikov from a Russian account through shell corporations in several countries including the British Virgin Islands, Panama, and the UK. The Department of Justice’s press release is here.
The EU has updated the identifying information for Dawood Ibrahim, who is listed by the UN for his alleged associations with Al-Qaida and position as “one of the most prominent criminals of the Indian underworld for most of the past two decades” (see previous blog). He has been listed since 2003 by the US government as a Specially Designated Global Terrorist and since 2006 as a Naroctics Trafficking Kingpin, and is the subject of an INTERPOL Red Notice for his arrest. The update adds 7 new aliases used by Mr Ibrahim, the address of his palatial bungalow in Karachi, and the names of his parents and spouse.
On 12 August 2016 the UN Security Council Sanctions Committee removed the Iraqi Oil Tanker Company and the State Oil Marketing Organisation from the UN Iraq list. The EU has just implemented those de-listings, amending Council Regulation 1210/2003 by Commission Implementing Regulation (EU) No 2016/1398 with effect from 21 August 2016. HM Treasury’s notice is here. The amending regulation is in the Official Journal here.
On 1 July 2016, OFAC issued an “interim final rule” increasing the maximum penalties for breach of US sanctions for inflation, with effect from 1 August 2016. The increases are:
-from $65,000 to $83,864 for the Cuba sanctions regime;
– from $1,075,000 to $1,414,020 under the Foreign Narcotics Kingpin Designation Act;
– from $250,000 to $284,582 for violations of the International Emergency Economic Powers Act (most other regimes).
OFAC increased the maximum civil penalty from $50,000 to $75,122 for breach of the requirement that financial institutions freeze funds of foreign terrorist organisations, and from $10,000 to $12,856 for violating the law implementing the Kimberley process for rough diamonds. Details are on the Federal Register here.
The US Bureau of Industry and Security has extended its temporary general licence for exports, reexports, and in-country transfers to Zhongxing Telecommunications Equipment (ZTE) until 28 November 2016. The US imposed export restrictions on ZTE in March, in response to ZTE allegedly breaching US sanctions by illicitly re-exporting controlled items to sanctioned countries, and organising a series of shell companies for this purpose in relation to Iran (see previous blog). BIS has indicated that it will continue to renew the temporary general licence provided ZTE continues to cooperate with the US government in resolving the issues that led to the violations.
The Department of Commerce’s notice is here.
OFAC has removed the Philippines and Indonesia branch offices of the International Islamic Relief Organisation (IIROSA) from its SDN List, where they were listed as Specially Designated Global Terrorists. The branches were listed by OFAC in 2006 for facilitating fundraising for al-Qaida and affiliated terrorist groups. IIROSA is a defendant in the civil 9/11 litigation in the Southern District of New York. The court had ruled that a substantial basis for IIROSA remaining in the litigation was the designations of the Philippines and Indonesia branch offices. Details of the de-listings are here.
The US State Department has suggested that Russia’s use of Iranian military airbases to launch strikes in Syria could violate UN sanctions on Iran which prohibit the supply, sale, and transfer of military aircraft to Iran unless approved by the UN Security Council. Russia’s Foreign Minister Sergey Lavrov has denied this allegation, saying yesterday that “there has been no supply, sale, or transfer of fighter jets to Iran…The Russian Air Force uses these fighter jets with Iran’s approval”.