The Treasury Department fined U.S. crypto exchange Kraken $362,158.70 for violating U.S. sanctions against Iran, the agency said this week. Treasury’s Office of Foreign Assets Control said Kraken, also known as Payward, exported services to users who “appeared to be” in Iran and allows them to conduct virtual currency transactions on Kraken’s platform. The violations stemmed from Kraken’s "failure to timely implement appropriate geolocation tools, including an automated [internet protocol] address blocking system," OFAC said.
Iran Export Controls
Certain items on the Commerce Control List require a license from BIS to export them to Iran. The Iranian Transactions Sanctions Regulations (ITSR) (31 CFR Part 560) also prohibit the export and reexport of goods to Iran subject to EAR.
Congress should create a new, “permanent” committee in the executive branch tasked with planning sanctions against China under “a range of possible scenarios,” including if it invades Taiwan, a congressional commission said this week. The bipartisan commission also said the Commerce Department should provide Congress with regular enforcement and licensing reports on certain China-related export control decisions and said the administration should create a new list of Chinese firms that should be subject to strict export licensing requirements.
The U.S. this week sanctioned firms and people involved in making drones and transferring them from Iran to Russia, including an Iranian producer and two United Arab Emirates entities. The designations come less than a month after the U.S. said it was considering additional sanctions on both Russia and Iran following Iranian sales and operation of drones in Ukraine (see 2210210046).
The Treasury Department wants to modernize its licensing approach to more easily allow humanitarian groups to send aid to sanctioned jurisdictions, said Alex Parets, counselor to Treasury’s undersecretary for terrorism and financial intelligence. Parets, speaking during a Nov. 14 event hosted by the Center for Strategic and International Studies, said the administration is prioritizing work to improve its exemption process for humanitarian organizations and banks working with them.
A United Arab Emirates company violated U.S. export controls by shipping or trying to ship more than $50,000 worth of U.S.-origin telecommunications items to Syria and Iran, the Bureau of Industry and Security said in a charging letter released last week. The company, WEBS Electronics Trading Company, and its owner, Mohammad Alhamra, also lied to a BIS agent when it said it didn’t export to Syria.
The Biden administration should “make full use” of its sanctions and export control authorities against Iran for transferring weapons and other military items to Russia, the ranking Republican on the House Foreign Affairs Committee said in a Nov. 1 letter to the White House. Rep. Michael McCaul of Texas said Iran has sent hundreds of “lethal Mohajer-6 and Shahed-136 drones, as well as related technology and military advisors” to Russia since it invaded Ukraine, and is reportedly preparing to provide “Fateh-100 and Zolfaghar” ballistic missiles.
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The Office of Foreign Assets Control on Sept. 27 released quarterly reports on certain licensing activities for Iran and Sudan, covering the period from April 2019 through September 2021. The reports provide licensing statistics for exports of agricultural goods, medicine and medical devices to both countries as required by the Trade Sanctions Reform and Export Enhancement Act of 2000.
The Office of Foreign Assets Control last week updated an Iran-related general license and guidance to expand the types of internet and communications services and exports that can be provided to Iran. Updated General License D2 “dramatically increases” U.S. support for internet freedom in Iran, a State Department official said, adding that the announcement brings U.S. sanctions guidance "in line with changes in modern technology.”
The Senate should move forward with bipartisan legislation that would give the administration stronger authorities to penalize and investigate sanctioned Russian oligarchs and tackle broader sanctions evasion issues (see 2207200020), senators said during a hearing this week. But Sen. Pat Toomey, R-Pa., said Congress shouldn’t be too quick to expand some of the Biden administration’s proposals, which could expand DOJ authorities unrelated to Russia.