An aircraft holding company is suing the Treasury Department after the agency blocked a transaction involving the company and an alleged Specially Designated Global Terrorist, according to court records filed June 2. In the lawsuit, Seychelles-registered Askan Holdings, owned by Romania-based Transylvania International Airlines SRL, argued that no sanctioned party was involved in the transaction and said the Treasury’s Office of Foreign Assets Control failed to identify the blocked party or grant Askan a license. Askan is asking a court to order OFAC to grant the license or to stop blocking the transaction.
The Commerce Department again renewed an export denial order for Mahan Airways because the airline continues to violate the order and the Export Administration Regulations, according to a May 29 notice. The Iranian airline has been on the banned list since 2008, and the notice renewed the ban for 180 days, until about Dec. 2, 2020, Commerce said. Since last renewing Mahan’s denial order in December (see 1912050032), the U.S. sanctioned a China-based logistics company for operating as a sales agent for Mahan Airways (see 2005190020 and 2005200027).
A North Korean bank and 28 North Korean and Chinese citizens were charged with evading U.S. sanctions, according to an indictment unsealed May 28. The scheme -- which included branches of North Korea’s state-owned Foreign Trade Bank in Thailand, Libya, Austria, Russia, Kuwait and China -- involved a series of front companies used to access the U.S. financial system. The scheme allowed the banks to process at least $2.5 billion in illegal payments through more than 250 front companies, which provided funding for North Korea’s nuclear missile programs.
A Texas man pleaded guilty to involvement in a scheme to illegally export 17 million cigarettes to Mexico, U.S. Immigration and Customs Enforcement said May 26. The cigarettes originated from a warehouse controlled and operated by Jose Francisco Guerra, who authorities later discovered owned a second warehouse with contraband cigarettes. The warehouses contained nearly 423 million contraband cigarettes destined for export to Mexico, ICE said. Authorities uncovered the scheme when they stopped a tractor trailer heading to Mexico with the cigarettes and a falsified shipping manifest, ICE said. The cigarettes on the truck also did not have “the applicable tax stamp” required by Texas law. As part of his plea, Guerra agreed to forfeit his customs broker license and various equipment and assets. The total value of the seized equipment and assets was about $88 million, ICE said. Guerra faces up to 10 years in prison and a potential $250,000 fine.
The State Department rescinded a policy of denial for a subsidiary of BAE Systems located in Saudi Arabia, according to a notice. The policy no longer applies to BAE Systems Saudi Arabia Limited (BAES SAL), which was one of several BAES subsidiaries convicted of violating the Arms Export Control Act and the International Traffic in Arms Regulations in 2010. The State Department rescinded the denial policy after receiving a request from BAES SAL and determining the action was “in the national security and foreign policy interests” of the U.S.
The State Department issued statutory debarment for 23 people for violations of the Arms Export Control Act, the agency said in a notice. The State Department stressed that they are blocked from participating in activities regulated by the International Traffic in Arms Regulations, including brokering activities, exports and temporary imports. The debarment period will last for three years, at which time the people can apply for reinstatement of export privileges, the agency said. If their export privileges are not reinstated, they remain debarred.
The Department of Justice charged the leaders of a sanctions-evading financial services company in Iran with wire fraud, money laundering, identity theft and sanctions violations, the agency said in a May 18 press release. PAYMENT24 CEO Seyed Sajjad Shahidian and COO Vahid Vali used the company to help Iranian citizens avoid U.S. financial sanctions against Iran, which included purchases of U.S. computer software, software licenses and computer servers. The company offered a package to help clients purchase goods and services from U.S. businesses, including a PayPal account, a fake “ID card,” a remote IP address from the United Arab Emirates and a Visa gift card. The company charged a fee to evade U.S. sanctions, the press release said.
The U.S. government appealed a March court decision that blocked the Trump administration from transferring oversight of 3D printing of firearms from the State Department to the Commerce Department (see 2003090029). The appeal, filed May 5, aims to lift the temporary injunction, which the administration has said is based on a misunderstanding of export regulations (see 2002270014).
Maltese authorities charged five men for violating European Union sanctions on Libya, according to an April 25 notice from the Malta Police Force. The arrests, which resulted from “weeks of investigations,” came after the men allegedly used a Malta-registered company to illegally export two ships to Libya. The men pleaded not guilty.
A South Korean bank will pay $86 million after admitting violations of the Bank Secrecy Act, which included processing transactions for sanctioned parties and violations of the International Emergency Economic Powers Act, the Justice Department said April 20. The Industrial Bank of Korea did not maintain an adequate anti-money laundering program and processed more than $1 billion worth of transactions for sanctioned Iranian entities, the Justice Department said. This was partly due to the bank’s lack of an automated screening program and its poorly trained compliance staff, which fell “months behind” their manual review of transactions. Despite self-disclosing some violations, the bank failed to inform the Treasury Department of at least $990 million worth of illegal transactions, the Justice Department said.