The departments of State and the Treasury announced Feb. 2 additional enforcement actions in an effort to thwart Iran’s ballistic missile and unmanned aerial vehicle programs as well as its cyber operations. Separately, the Justice Department sentenced a UK national to 18 months in prison for violating the Iran sanctions.
Specifically, Treasury’s Office of Foreign Assets Control has designated three Hong Kong-based front companies and one Iran-based subsidiary of a designated entity for supplying materials and sensitive technology for Iran’s ballistic missile and UAV programs, including UAVs being used by the Russian military against Ukraine. Another Hong Kong-based front company has been designated for its involvement in the sale of hundreds of millions of dollars’ worth of Iranian commodities for the benefit of the Islamic Revolutionary Guard Corps-Qods Force.
As a result of these actions, all property and interests in property of these 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 U.S. or in the possession or control of U.S. persons must be blocked and reported to OFAC. All transactions by U.S. persons or within the U.S. (including transactions transiting the U.S.) that involve any property or interests in property of blocked or designated persons are prohibited.
In addition, persons that engage in certain transactions with any of these entities may themselves be exposed to sanctions. Furthermore, any foreign financial institution that knowingly facilitates a significant transaction or provides significant financial services for any of the designated entities could be subject to U.S. sanctions.
OFAC has also sanctioned six officials in the Iranian Islamic Revolutionary Guard Corps Cyber-Electronic Command in response to recent cyber operations by IRGC-affiliated cyber actors in which they hacked and posted images on the screens of programmable logic controllers manufactured by an Israeli company.
Furthermore, the Justice Department reported Feb. 1 that a UK national has been sentenced to 18 months in prison for violations of the International Emergency Economic Powers Act and the Iranian Transactions and Sanctions Regulations. According to the plea agreement, this person conspired with others to export and attempt to export an industrial microwave system and counter-drone system from the U.S. to Iran without first obtaining the requisite license from OFAC. The counter-drone system, which has both commercial and military uses, can be used to stop, identify, redirect, land, or take total control of a target UAV.
For more information on export and sanctions penalties and how to avoid them, please contact attorney Kristine Pirnia via email.
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