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  • OFAC sanctions additional Venezuelan government officials, amends and adds general licenses

    Financial Crimes

    On November 5, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions against five current Venezuelan government officials. The sanctions—issued pursuant to Executive Order (E.O.) 13884, which prevents all property and property interests of the Government of Venezuela existing within the U.S. or in the possession of a U.S. person from being transferred, paid, exported, withdrawn, or otherwise dealt in (previous InfoBytes coverage here)—reflects Treasury’s continued efforts against persons who offer support to the Maduro regime.

    In conjunction with the sanctions, OFAC also issued amended Venezuelan General License (GL) 34A, which supersedes and replaces GL 34, and authorizes transactions with certain Venezuelan government individuals blocked by E.O. 13884. OFAC also issued GL 35, titled “Authorizing Certain Administrative Transactions with the Government of Venezuela,” which permits certain transactions “necessary and ordinarily incident” to day-to-day operations. New and amended FAQs provide additional guidance.

    Visit here for additional InfoBytes coverage of actions related to Venezuela.

    Financial Crimes Department of Treasury OFAC Venezuela Of Interest to Non-US Persons Sanctions

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  • OFAC extends two Ukraine-related general licenses

    Financial Crimes

    On November 1, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced it extended the expiration date to March 31, 2020 of two Ukraine-related general licenses (GLs) by issuing GL 13M, which supersedes GL 13L, and GL 15G, which supersedes GL 15F. OFAC also noted that GL 15G includes an expanded authorization for certain safety-related activity and a new authorization for certain activities to comply with environmental regulatory requirements.

    Visit here for continuing InfoBytes coverage of actions related to Ukraine.

    Financial Crimes Of Interest to Non-US Persons Department of Treasury OFAC Ukraine Sanctions

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  • Terrorist Financing Targeting Center designates network supporting IRGC and Hizballah

    Financial Crimes

    On October 30, the U.S. Treasury Department announced that the seven member nations of the Terrorist Financing Targeting Center (TFTC) have jointly designated 25 targets for allegedly supporting Iran’s Islamic Revolutionary Guard Corps and Hizballah, as part of Treasury’s efforts to “bolster the fight against terrorist financing.” The targets include 21 entities that comprise a “vast network of businesses providing financial support to the Basij Resistance Force” through the use of shell companies and other measures within Iran’s automotive, mining, metals, and banking industries, along with four Hizballah-affiliated individuals allegedly involved in related financial activities in Iraq. The seven members—Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, the United Arab Emirates, and the U.S.—coordinate disruptive actions, share financial intelligence information, and enhance member state capacity in order to target activities posing national security threats to TFTC members, including the disruption of financial networks used to fund terrorism.

    Visit here for additional InfoBytes coverage on actions involving Iran and Hizballah.

    Financial Crimes Department of Treasury Iran Of Interest to Non-US Persons

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  • OFAC amends Venezuela-related general license, delays effective date

    Financial Crimes

    On October 24, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) issued amended Venezuela General License (GL) 5A to highlight a delay in effectiveness and clarify that prior to January 22, 2020, certain transactions related to the financing for, and other dealings in the Petróleos de Venezuela SA 2020 8.5 Percent Bond are prohibited under Executive Orders 13835 and 13857, unless specifically authorized by OFAC. OFAC also published a new FAQ to provide additional guidance on the reason for the issues of GL 5A.

    Visit here for additional InfoBytes coverage of actions related to Venezuela.

    Financial Crimes Department of Treasury OFAC Venezuela Of Interest to Non-US Persons

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  • FATF updates jurisdictions with AML/CFT deficiencies

    Financial Crimes

    On October 18, the Financial Action Task Force (FATF) published its updated list of jurisdictions identified as having “strategic deficiencies” in their anti-money laundering and combating the financing of terrorism (AML/CFT) regimes that have also developed action plans with the FATF to address the deficiencies. The list of jurisdictions includes the Bahamas, Botswana, Cambodia, Ghana, Iceland, Mongolia, Pakistan, Panama, Syria, Trinidad and Tobago, Yemen, and Zimbabwe. Notably, Ethiopia, Sri Lanka, and Tunisia have been removed from the list and are no longer subject to the FATF’s AML/CFT compliance process due to making “significant progress” in their regimes, while Iceland, Mongolia, and Zimbabwe have been added since the last update in June (covered by InfoBytes here). The FATF further notes that several jurisdictions have not yet been reviewed, and that it “continues to identify additional jurisdictions, on an ongoing basis, that pose a risk to the international financial system.” While the FATF does not instruct members to apply enhanced due diligence to these jurisdictions, it encourages members to take this information into account when conducting money laundering risk assessments and due diligence.

    Financial Crimes FATF Anti-Money Laundering Combating the Financing of Terrorism Of Interest to Non-US Persons Customer Due Diligence

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  • FinCEN final rule designates Iran a primary money laundering concern; new Treasury and State department mechanism to make humanitarian trade more transparent

    Financial Crimes

    On October 25, the U.S. Treasury Department announced the issuance of a final rule by the Financial Crimes Enforcement Network (FinCEN) to impose a fifth special measure against Iran as a jurisdiction of primary money laundering concern under Section 311 of the USA Patriot Act. The final rule prohibits U.S. financial institutions from opening or maintaining a correspondent account on behalf of an Iranian financial institution, and also prohibits U.S. financial institutions from processing transactions involving Iranian financial institutions. The final rule takes effect ten days after publication in the Federal Register.

    FinCEN stated that its action is based on Iran’s abuse of the international financial system, including providing support for terrorist groups such as Hizballah and HAMAS, and builds upon Treasury’s Office of Foreign Assets Control’s (OFAC) September designation of Iran’s central bank for providing financial support to the Islamic Revolutionary Guards Corps, its Qods Force, and Hizballah (previous InfoBytes coverage here). Additionally, FinCEN determined that the Iranian regime continues to engage in deceptive financial practices through the use of front companies and shell companies, among other things, to facilitate military purchases. These actions, FinCEN noted, are “further compounded by Iran’s continued failure to adequately address its AML/CFT deficiencies, as identified by the Financial Action Task Force,” which recently re-imposed countermeasures and enhanced due diligence strategies on Iran and “called on its members and urged all jurisdictions to advise their financial institutions to apply enhanced due diligence with respect to business relationships and transactions with natural and legal persons from Iran.” (Previous InfoBytes coverage here.) 

    Concurrent with the imposition of the fifth special measure, Treasury and the U.S. Department of State announced a new mechanism to increase the transparency of humanitarian trade with Iran that will establish processes for participating foreign governments and financial institutions when conducting enhanced due diligence designed to mitigate the higher risks associated with Iran-related transactions. OFAC’s guidance outlines due diligence and reporting requirements for participating entities, and stipulates that “[p]rovided that foreign financial institutions commit to implement stringent enhanced due diligence steps, the framework will enable them to seek written confirmation from Treasury that the proposed financial channel will not be exposed to U.S. sanctions.”

    Financial Crimes FinCEN Department of Treasury Anti-Money Laundering Combating the Financing of Terrorism Of Interest to Non-US Persons Patriot Act

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  • OFAC amends Venezuela-related general license

    Financial Crimes

    On October 21, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced General License (GL) 8D, titled “Authorizing Transactions Involving Petróleos de Venezuela, S.A. (PdVSA) Necessary for Maintenance of Operations for Certain Entities in Venezuela,” which supersedes GL 8C to extend the expiration date through January 22, 2020.

    Visit here for additional InfoBytes coverage of actions related to Venezuela.

    Financial Crimes Of Interest to Non-US Persons Department of Treasury OFAC Sanctions Venezuela

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  • Treasury convenes Counter-Hizballah International Partnership to prevent illicit financial activity

    Financial Crimes

    On October 18, the U.S. Treasury Department announced it had convened the first meeting of the Counter-Hizballah International Partnership (CHIP) involving representatives from over 30 countries. CHIP participants discussed methods to diminish Hizballah’s exploitation of the international financial system to fund terrorist activities and stressed the importance of building momentum and ensuring coordination of efforts. Impact-oriented considerations included: (i) establishing cross-border information sharing among financial intelligence units; (ii) “strengthening terrorism finance risk assessments”; (iii) creating “targeted financial sanctions regimes;” and (iv) prosecuting terrorists and their affiliated financial facilitators.

    Find continuing InfoBytes coverage related to Hizballah here.

    Financial Crimes Department of Treasury Of Interest to Non-US Persons

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  • FATF discusses terror finance risks, virtual currency regulation, and global AML/CFT deficiencies

    Financial Crimes

    On October 18, the U.S. Treasury Department released a public statement issued by the Financial Action Task Force (FATF) following the conclusion of its plenary meeting held October 16-18. Topics discussed by attendees included Iranian terrorist financial risks, guidance related to “stablecoins” and virtual assets, and reports related to anti-money laundering/countering the financing of terrorism (AML/CFT). Specifically, the FATF discussed the re-imposition of countermeasures on Iran as well as enhanced due diligence strategies due to the country’s AML/CFT deficiencies. As previously covered by InfoBytes, the FATF issued a public statement last June that called upon members and urged all jurisdictions to require increased supervisory examination for branches and subsidiaries of financial institutions based in Iran. Assistant Secretary for Terrorist Financing and Financial Crimes Marshall Billingslea issued a statement in Treasury’s press release that “countries will be called upon to impose further financial restrictions to protect the international financial system if Iran hasn’t ratified and fully implemented the key treaties related to fighting money laundering and terrorist financing.”

    The FATF also issued a public statement to clarify that standards adopted last June (InfoBytes coverage here) apply to “stablecoins” and their service providers. Additionally, the FATF adopted changes to its methodology on how it will assess whether countries are complying with the relevant requirements. Specifically, the FATF noted in the plenary meeting outcomes that “assessments will specifically look at how well countries have implemented these measures. Countries that have already undergone their mutual evaluation must report back during their follow-up process on the actions they have taken in this area.”

    Additionally, the FATF (i) provided an updated report on measures for combating ISIL and Al-Qaeda financing; (ii) called upon all countries to apply countermeasures on North Korea due to ongoing AML/CFT and weapons of mass destruction proliferation financing risks to the international financial system; and (iii) noted it will publish reports by year end related to AML/CFT and counter-proliferation financing legal frameworks for both Russia and Turkey, along with a review of implementation measures undertaken by the countries.

    Financial Crimes Department of Treasury FATF Anti-Money Laundering Combating the Financing of Terrorism Of Interest to Non-US Persons Virtual Currency

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  • DOJ charges Turkish bank in Iran sanctions violation scheme

    Financial Crimes

    On October 15, the DOJ announced charges against a Turkish bank alleging fraud, money laundering, and sanctions offenses related to the bank’s alleged participation in a scheme to evade U.S. sanctions on Iran. According to the indictment, the bank used money service businesses and front companies to evade U.S. sanctions against Iran and “avoid prohibitions against Iran’s access to the U.S. financial system.” The bank allegedly lied to U.S. regulators and foreign banks about its participation in the fraudulent transactions. The concealed funds, the DOJ claimed, “were used to make international payments on behalf of the Government of Iran and Iranian banks, including transfers in U.S. dollars that passed through the U.S. financial system in violation of U.S. sanctions laws.” Additionally, the DOJ asserted that the conduct—which allowed Iran access to “billions of dollars’ worth of Iranian oil revenue”—was protected by high ranking government officials in Iran and Turkey, some of whom received millions of dollars in bribes to promote and protect the scheme from U.S. scrutiny. 

    Financial Crimes DOJ Sanctions Of Interest to Non-US Persons Iran Anti-Money Laundering

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