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CISA urges companies to take action to combat malicious cyber activity
On September 14, the Cybersecurity and Infrastructure Security Agency, along with several other federal agencies and international partners, released a joint cybersecurity advisory (CSA) highlighting continued malicious cyber activity taken by advanced persistent threat actors affiliated with the Iranian Government’s Islamic Revolutionary Guard Corps (IRGC). The CSA recommended that companies continually test their security programs to protect against longstanding online threats that may arise from IRGC-affiliated actors known for exploiting vulnerabilities for ransom operations. “Our unified purpose is to drive timely and prioritized adoption of mitigations and controls that are most effective to reducing risk to all cyber threats,” CISA said in its announcement. Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson added that the U.S. Treasury Department “is dedicated to collaborating with other U.S. government agencies, allies, and partners to combat and deter malicious cyber-enabled actors and their activities, especially ransomware and cybercrime that targets economic infrastructure.” He noted that the CSA provides information on specific tactics, techniques, and procedures used by IRGC-affiliated actors, and advised both the public and private sector to use the information to strengthen cybersecurity resilience and reduce the risk of ransomware incidents. Organizations are encouraged to review a 2021 Treasury advisory, which highlights the sanctions risks associated with ransomware payments and provides steps for companies to take to mitigate the risk of being a victim of ransomware (covered by InfoBytes here).
OFAC sanctions individuals and entities connected to IRGC-QF
On September 14, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions as part of a joint action with the DOJ, Department of State, FBI, U.S. Cyber Command, National Security Agency, and Cybersecurity and Infrastructure Security Agency, against ten individuals and two entities for their roles in conducting malicious cyber acts, including ransomware activity. The individuals and entities designated are affiliated with Iran’s Islamic Revolutionary Guard Corps (IRGC), which “is known to exploit software vulnerabilities in order to carry out their ransomware activities, as well as engage in unauthorized computer access, data exfiltration, and other malicious cyber activities.” OFAC also noted that a joint cyber security advisory was published to highlight continued malicious cyber activity by advanced persistent threat actors that the authoring agencies assess are affiliated with IRGC. As a result of the sanctions, all property, and interests in property of the designated individuals and entities, “and of any entities that are owned, directly or indirectly, 50 percent or more by them, individually, or with other blocked persons, that are in the United States or in the possession or control of U.S. persons, must be blocked and reported to OFAC.” U.S. persons are generally prohibited from engaging in transactions with the designated persons. OFAC further warned that engaging in certain transactions with the individuals and entities designated today entails risk of additional sanctions.
OFAC sanctions Iranians involved in production of UAVs to Russia
On September 8, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Orders 13382 and 14024 against an Iran-based air transportation service provider, as well as three companies and one individual involved in the research, development, production, and procurement of Iranian unmanned aerial vehicles (UAVs) and UAV components. Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson reiterated that the U.S. “is committed to strictly enforcing our sanctions against both Russia and Iran and holding accountable Iran and those supporting Russia’s war of aggression against Ukraine,” and stressed that the U.S. will “not hesitate to target producers and procurers who contribute to Iran and its IRGC’s UAV program, further demonstrating [the U.S.’s] resolve to continue going after terrorist proxies that destabilize the Middle East.” The sanctions follow designations implemented by OFAC last year against members of a network of companies and individuals that provided critical support to Iran’s Islamic Revolutionary Guard Corps Qods Force’s use of UAVs (previously covered by InfoBytes here).
As a result of the sanctions, all property and interests in property belonging to the sanctioned individuals and entities subject to U.S. jurisdiction are blocked and must be reported to OFAC. U.S. persons are also generally prohibited from engaging in any dealings involving the property or interests in property of blocked or designated persons. Additionally, OFAC warned that “any foreign financial institution that knowingly facilitates a significant transaction or provides significant financial services for any of the individuals or entities designated today could be subject to U.S. correspondent or payable-through account sanctions.”
OFAC sanctions Iran’s MOIS over cyber activities
On September 9, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order (E.O.) 13694 against Iran’s Ministry of Intelligence and Security (MOIS) and its Minister of Intelligence for conducting malicious cyber-enabled activities targeting government and private-sector organizations and across various critical infrastructure sectors, including the U.S. and its allies. OFAC noted that in July, MOIS and the Iranian government sponsored cyber-threat actors who disrupted the Albanian government computer systems. OFAC previously flagged MOIS pursuant to E.O.s 13224, 13472, and 13553 for supporting multiple terrorist groups, as well as for commissioning serious human rights abuses against the Iranian people.
As a result of the sanctions, all property and interests in property belonging to the sanctioned targets that are in the U.S. or in the possession or control of U.S. persons, and “any entities that are owned 50 percent or more by one or more designated persons” are blocked. Additionally, U.S. persons are prohibited from engaging in any dealings involving the property or interests in property of blocked or designated persons, unless exempt or authorized by a general or specific OFAC license. Additionally, OFAC warned that “any foreign financial institution that knowingly conducts or facilitates a significant transaction for or on behalf of the persons designated today could be subject to U.S. correspondent or payable-through account sanctions.”
OFAC issues updated Iran general license and related FAQ
On August 25, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) issued Iran General License (GL) M-2, “Authorizing the Exportation of Certain Graduate Level Educational Services and Software,” which authorizes accredited graduate and undergraduate degree-granting academic institutions in the U.S. to engage with Iranian students in online educational services and exploration of software through September 1, 2023, provided certain criteria are met. OFAC also published an updated FAQ related to GL M-2. Effective August 25, GL M-2 supersedes and replaces GL M-1.
OFAC sanctions Iranian petrochemical network
On August 1, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order 13846 against companies used by one of Iran’s largest petrochemical brokers to facilitate the sale of Iranian petroleum and petrochemical products from Iran to East Asia. The designations follow OFAC sanctions announced on July 6 against a network of individuals and entities for facilitating the delivery and sale of hundreds of millions of dollars’ worth of Iranian petroleum and petrochemical products from Iranian companies to East Asia through a web of Gulf-based front companies (covered by InfoBytes here). As a result of the sanctions, all property and interests in property of the sanctioned persons subject to U.S. jurisdiction, as well as any entities owned 50 percent or more by such persons, are blocked and must be reported to OFAC. U.S. persons are also generally prohibited from entering into transactions with the sanctioned persons. Additionally, OFAC warned that “any foreign financial institution that knowingly facilitates a significant transaction for any of the individuals or entities designated today could be subject to U.S. sanctions.”
11th Circuit: Statements indicating accrual of debt balance following settlement are enough to state a claim
On July 1, the U.S. Court of Appeals for the Eleventh Circuit overturned a district court’s dismissal of an FDCPA case, holding that statements sent to plaintiffs indicating that a debt balance was accruing after a settlement had been reached is enough to state a claim. According to the opinion, the plaintiffs defaulted on a mortgage and a servicer sued for foreclosure. While the foreclosure suit was pending, the defendant took over servicing of the loan. A “disagreement” arose, which led the plaintiffs to sue the defendant. A settlement was reached and it was agreed that the plaintiffs owed $85,790.99, which was to be paid in one year. However, four months later, the defendant sent a mortgage statement notifying the plaintiffs that their loan had “been accelerated” because they were “late on [their] monthly payments.” On the defendant’s “fast-tracked timetable,” the plaintiff owed $92,789.55 to be paid in a month, and if they did not pay, the defendant’s statement stated that they risked more fees and “the loss of [their] home to a foreclosure sale.” The plaintiffs continued to receive statements and the amount due increased monthly. The plaintiffs sued, saying the defendant violated the FDCPA by sending statements with incorrect balances. A district court ruled the periodic statements were unrelated to debt collection because the defendant was required to send monthly updates under TILA. The district court further determined that the plaintiffs failed to state an FDCPA claim, declined to exercise supplemental jurisdiction over the Florida law claims, and dismissed the complaint.
On appeal, the 11th Circuit ruled that statements must comply with the FDCPA, even if they are not required to be sent under the statute. The 11th Circuit reiterated that the respective requirements of TILA and the FDCPA can be approached in a “harmonized” fashion, stating that “a periodic statement mandated by [TILA] can also be a debt-collection communication covered by the FDCPA.” The appellate court reversed the district court’s dismissal because “the complaint here plausibly alleges that the periodic statements sent to the plaintiffs aimed to collect their debt.”
OFAC sanctions Iranian petrochemical network
On July 6, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions pursuant to Executive Order 13846 against an international network of individuals and entities for facilitating the delivery and sale of hundreds of millions of dollars’ worth of Iranian petroleum and petrochemical products from Iranian companies to East Asia through a web of Gulf-based front companies. The designations follow OFAC sanctions announced June 16 against a network of Iranian petrochemical producers, as well as front companies in the People’s Republic of China and the United Arab Emirates, working to support Iranian petrochemical sales (covered by InfoBytes here). As a result, all property and interests in property of the sanctioned persons subject to U.S. jurisdiction are blocked and must be reported to OFAC, as well as any entities owned 50 percent or more by such persons. U.S. persons are also generally prohibited from entering into transactions with the sanctioned persons. Additionally, OFAC warned that “any foreign financial institution that knowingly facilitates a significant transaction for any of the individuals or entities designated today could be subject to U.S. sanctions.”
FinCEN issues statements on its lists of jurisdictions with AML/CFT/CPF deficiencies
On June 23, FinCEN announced that the Financial Action Task Force (FATF) issued public statements updating its lists of jurisdictions with strategic deficiencies in anti-money laundering (AML), countering the financing of terrorism (CFT), and countering the financing of proliferation of weapons of mass destructions (CPF). FATF’s statements include (i) Jurisdictions under Increased Monitoring, “which publicly identifies jurisdictions with strategic deficiencies in their AML/CFT/CPF regimes that have committed to, or are actively working with, the FATF to address those deficiencies in accordance with an agreed upon timeline,” and (ii) High-Risk Jurisdictions Subject to a Call for Action, “which publicly identifies jurisdictions with significant strategic deficiencies in their AML/CFT/CPF regimes and calls on all FATF members to apply enhanced due diligence, and, in the most serious cases, apply counter-measures to protect the international financial system from the money laundering, terrorist financing, and proliferation financing risks emanating from the identified countries.” FinCEN’s announcement also informs members that FATF removed Malta from its list of Jurisdictions under Increased Monitoring and added Gibraltar, and that its list of High-Risk Jurisdictions Subject to a Call for Action continues to subject Iran and the Democratic People’s Republic of Korea to the FATF’s countermeasures.
OFAC sanctions Iranian petrochemical producers and other supporting entities
On June 16, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions against a network of Iranian petrochemical producers, as well as front companies in the People’s Republic of China (PRC) and the United Arab Emirates (UAE), for supporting two entities connected to the sale of Iranian petrochemicals abroad. According to OFAC, the designated network "helps effectuate international transactions and evade sanctions, supporting the sale of Iranian petrochemical products to customers in the PRC and the rest of East Asia.” As a result, all property and interests in property of the sanctioned persons subject to U.S. jurisdiction are blocked, as well as any entities owned 50 percent or more by such persons. U.S. persons are also generally prohibited from entering into transactions with the sanctioned persons. Additionally, OFAC warned that “any foreign financial institution that knowingly facilitates a significant transaction for any of the individuals or entities designated today could be subject to U.S. sanctions.”