The Bureau of Industry and Security issued a 180-day temporary denial order this week against three people and two companies for illegally sending controlled exports to Russia as part of a Moscow-led sanctions evasion scheme. Along with the denial order, DOJ indicted the three people, along with others, on charges related to the illegal exports, including money laundering, wire fraud, bank fraud and conspiring to defraud the U.S.
Assistant Attorney General Kenneth Polite last week touted DOJ's action under the Foreign Corrupt Practices Act, championing DOJ's $315 million FCPA resolution with ABB over the company's bribery of an official in South Africa's state-owned energy company (see 2212050021). The case was the department's "first coordinated resolution with authorities in South Africa," and has resulted in South African authorities bringing corruption charges of their own against the official, Polite said in closing remarks, as prepared for delivery, Dec. 9 at an anti-corruption conference.
Allied export control authorities should be more nimble, harmonized and coordinated to maximize their effectiveness, particularly around Russia restrictions, said Kevin Wolf, a former senior U.S. export control official. In written comments last week to the U.K. Parliament’s arms export control committees, Wolf also said the U.K. and other countries can improve their export enforcement efforts against Russia, including by creating incentives for companies to “enhance” their compliance programs, dedicating more resources to study Russian sanctions evasion and working together to create a “standard structure of export control violations.”
The U.S. and the EU didn’t appear to make much progress on export controls, investment screening and other pivotal areas of cooperation at the latest Trade and Technology Council meeting this month, experts with the Center for Strategic and International Studies said during a Dec. 12 event. The two sides still look to be closely aligned on Russia controls and sanctions, the speakers said, but until the TTC announces more concrete measures, it remains unclear how similarly they view restrictions on China.
The U.K. added Ramil Rakhmatulovich Ibatullin to its Russia sanctions regime, the Office of Financial Sanctions Implementation said in a Dec. 9 notice. Ibatullin, the commander of the 90th Tank Division, is now subject to an asset freeze and travel ban. In addition, OFSI corrected three entries for Maxim Loktev, Igor Yegorov and Denis Manturov.
Canada on Dec. 9 announced new sanctions on people and entities in Russia, Iran and Myanmar for human rights violations. The sanctions target 67 people and nine entities, including 33 current or former Russian senior officials and six entities involved in human rights violations against Russian citizens; 22 people “complicit in gross and systematic human rights violations” in Iran; and 12 people and three entities that “perform key functions on behalf of the Myanmar military regime.”
The Office of Foreign Assets Control on Dec. 9. designated "a diverse array" of over 40 people and entities connected to corruption or human rights abuses in recognition of International Anti-Corruption Day and Human Rights Day. The sanctions target people and entities across nine countries, OFAC said.
The U.S. should prepare a range of economic and financial restrictions against China to deter it from invading Taiwan, including new sanctions against Chinese banks and outbound investment restrictions on Chinese technology sectors, said Sen. Dan Sullivan, R-Alaska. Sullivan said the sanctions should “go far beyond what has been imposed on Russia” and make clear to Beijing that “no corner of its economy will be left untouched by sanctions.”
European Securities Stakeholder Group Asks for Guidance on Maintaining Asset Rights in Russian Firms
The European Securities and Markets Authority (ESMA's) Securities and Markets Stakeholder Group (SMSG) recently released a paper on the geopolitical risks surrounding depositary receipts. The SMSG looked into the effect of both EU and Russian sanctions on DRs and asks for guidance and a harmonized approach from the ESMA and European Commission over how EU citizens can maintain their asset rights in Russian companies.
Andrii Derkach, a Ukrainian national, was charged under the International Emergency Economic Powers Act with conspiracy to violate U.S. sanctions on Russia, DOJ announced. Per the indictment unsealed Dec. 7 in the U.S. District Court for the Eastern District of New York, Derkach is accused of bank fraud conspiracy, money laundering conspiracy and four counts of money laundering relating to the purchase of two California condominiums. The charges, along with forfeiture action taken on the condominiums, mark the first use of "criminal and forfeiture powers targeting the concealment of ownership by senior foreign political officials" as part of the National Defense Authorization Act of 2021, DOJ said.