The Office of Foreign Assets Control took significant sanctions actions over the last week in the illicit drug, Russia and Iran programs. OFAC also updated its Specially Designated Nationals List and announced a settlement with Mondo:
Illicit drug-related Sanctions
- OFAC Sanctions Mexico- and China-Based Money Launderers Linked to the Sinaloa Cartel: OFAC on July 1 sanctioned a Mexico-based money launderer and China-based members of a money laundering organization with criminal links to the Sinaloa Cartel. This action is the result of the U.S. government’s ongoing efforts, in cooperation with the Mexican government, to disrupt the trafficking of fentanyl. OFAC designated Mexico-based Diego Acosta Ovalle and Sinaloa Cartel associates Tong Peiji (佟霈佶) and He Jiaxuan (何家璇), both members of a Chinese money laundering organization that has laundered illicit drug proceeds belonging to the Sinaloa Cartel. Read more.
Russia-related Sanctions
- OFAC Issues General License to Authorize Certain Services Related to Sakhalin-2: OFAC on June 26 issued Russia-related General License 55B, “Authorizing Certain Services Related to Sakhalin-2.” GL 55B authorizes certain services related to the maritime transport of crude oil originating from the Sakhalin-2 project. The general license authorizes these transactions through June 28, 2025, provided that the Sakhalin-2 byproduct is solely for importation into Japan. Read more.
Iran-related Sanctions
- OFAC Sanctions Iran’s Shadow Banking Network: OFAC on June 25 sanctioned nearly 50 entities and individuals that constitute multiple branches of a sprawling “shadow banking” network used by Iran’s Ministry of Defense and Armed Forces Logistics and Islamic Revolutionary Guard Corps to gain illicit access to the international financial system and process the equivalent of billions of dollars since 2020. Shadow banking networks are multi-jurisdictional illicit finance systems which grant sanctioned Iranian entities access to the international financial system and obfuscate their trade with foreign customers. The MODAFL Supply Division uses exchange houses in Iran that manage numerous cover companies registered in permissive jurisdictions such as Hong Kong or the United Arab Emirates to launder the revenue generated through foreign commercial activity, including oil sales. Read more.
SDN List Updates
- OFAC Adds Entities and Vessels to SDN List: OFAC on June 27 added entities and vessels to the Specially Designated Nationals List pursuant to Executive Order 13846, Reimposing Certain Sanctions With Respect to Iran. See the updates to the SDN List. Read more.
Enforcement Action
- OFAC Announces $538,000 Settlement with Mondo for Violations of North Korea Sanctions Regulations: OFAC on June 26 announced a $538,000 settlement with Mondo TV, S.p.a. Mondo, an Italy-based animation company, has agreed to settle its potential civil liability for 18 apparent violations of the North Korea Sanctions Regulations. Specifically, between May 2019 and November 2021, Mondo caused U.S. financial institutions to process approximately $537,939 in payments for animation work Mondo outsourced to a Government of North Korea-owned animation studio. This settlement amount reflects OFAC’s determination that Mondo’s conduct was non-egregious and not voluntarily disclosed. Read more.
