Financial Sanctions – Page 3 – European Sanctions Enforcement

September 25, 2024September 25, 2024 by Mark Handley

Luxembourg – CSSF imposes fine for sanctions compliance failings

Luxembourg’s financial services regulator, the CSSF, has today announced a fine of €40,000 on Dock Financial S.A.

The fines relates to AML and sanctions compliance failings identified as part of an on-site inspection between December 2021 and November 2022.

In relation to sanctions, the CSSF has found that:

“A substantial part of the EMI’s client portfolio was not subject to name screening controls on a daily basis, over a substantial period of time, thus constituting a failure to comply with the obligation to detect persons, entities and groups subject to restrictive measures in financial matters without delay so that the necessary restrictive measures can be applied to them in line with all United Nations Security Council resolutions, acts adopted by the European Union (resolutions and acts directly applicable in Luxembourg) and national regulations“.

This was identified as a breach of CSSF regulations requiring detection of designated persons.

September 25, 2024September 25, 2024 by Mark Handley

Netherlands – fines imposed for making funds available to a designated person

Further to our earlier post from July 2023 regarding the arrest of a 73-year old individual, the Dutch Public Prosecution Service has announced that it has reached a settlement both with the individual and a related company. The press release is only available in Dutch and was not included amongst those published in English.

The company has been fined €195,000 and the individual, the company’s director, has been fined €20,000. The company and the individual have not been named.

The fines have been imposed because at the end of 2021 the company paid out dividends of approximately €18m to one of its shareholders who was a designated person under the EU’s Russian sanctions. The company also did not freeze the designated person’s shares, and continued to allow the shares to vote.

In addition, in 2019, a loan of €100,000 was repaid to a different Russian designated person in breach of the EU’s asset freeze.

September 23, 2024September 23, 2024 by Mark Handley

Romania – authorities arrest and extradite suspect to the US

The US Attorney’s Office for the Eastern District of New York has issued a press release concerning the guilty plea by Mohammad Bazzi on charges of conspiracy to conduct unlawful transactions with a Specially Designated Global Terrorist.

The press release confirmed that Bazzi was arrested in Romania in March 2023 by the Romanian authorities, and was then subsequently extradited to the United States to face the charges there.

September 18, 2024September 18, 2024 by Mark Handley

Lithuania – seizure of fire trucks exported from Belarus

It is being reported in the Zimbabwe press that 17 fire trucks purchased by the government of Zimbabwe from a supplier in Belarus were seized in March 2023 by the Lithuanian authorities on suspicion of the export and/or sale of the fire trucks breaching the EU’s Belarus sanctions.

It is also being reported that diplomatic efforts by Zimbabwe to secure the release of the trucks have so far been unsuccessful.

The report further states that the trucks are said to contain components manufactured by an entity included as a designated person under the Belarus sanctions.

While an investigation remains ongoing into the transshipment of the fire trucks to Zimbabwe via Lithuania it is unclear on what basis the fire trucks remain detained.

September 12, 2024 by Mark Handley

Netherlands – conviction for breach of ISIS sanctions upheld by Court of Appeal

Yesterday the Court of Appeal in the Hague issued judgment on an appeal against a conviction for multiple terrorism-related offences including one of making funds or economic resources available to a person designated under the EU’s ISIS sanctions.

The transfers were of €200 and €300 respectively.

The conviction was upheld on the basis that the necessary criminal intent was present:

“In order to prove that the regulations have been deliberately violated, it is not necessary to prove that there was intent to violate the standards set out in the indictment. The intent is colorless. However, it must be proved that the defendant intended that the sums of money would end up directly or indirectly with [person 1] and [person 2], to whom the Terrorism Sanctions Regulations 2007-II applied at the time“.

The total sentence was for a custodial prison term of 48 months, but it is not possible to identify what proportion of that was for the sanctions offence and what proportion for the other non-sanctions convictions.

September 10, 2024 by Mark Handley

France – trial underway against the captain of a Russian cargo ship for sanctions breaches

The trial of the captain of a Russian cargo ship is now underway in Rouen.

It is being reported that the Rouen Prosecutor’s Office is seeking a fine of €8m, plus confiscation of the ship (valued at €8m) plus a suspended prison sentence of 10 months.

The case arises from the departure from the port of Rouen on 25 February 2022 of the vessel the “Baltic Leader” which was Russian flagged and carrying wind turbines.

Part of the prosecution’s case is that the vessel was ultimately owned and/or controlled by Promsvyazbank which is a designated person under the EU’s Russian sanctions.

September 10, 2024 by Mark Handley

Lithuania – two companies fined for Russian sanctions breaches

The Lithuanian Customs Department has today issued a press release confirming that two companies – unnamed – have each been fined €10,000.

The breaches were the provision of services – described as “temporary storage, clearance of customs documents, representation at customs” – to entities included on the EU’s list of designated persons under the EU’s Russian sanctions.

August 16, 2024 by Mark Handley

Lithuania – company fined over €1.2m for importing Russian coal and rubber from designated persons

The Customs Office of Lithuania has issued a press release confirming that it has imposed a fine of €1,274,960 on an unnamed Lithuanian company for the importation of both coal and rubber from Russia in breach of EU sanctions.

The Russian suppliers are themselves said to be the subject of sanctions, but have not been named.

The enforcement action was conducted by the Business Entity Inspections Department of the Kaunas Region.

August 14, 2024 by Mark Handley

Lithuania – more than 50 currently-ongoing sanctions investigations

A published interview with Lithuania’s Prosecutor General has stated that the Lithuanian authorities currently have “more than 50 pre-trial investigations into sanctions violations” – including both Russian and Belarusian sanctions.

The interview included mention of the fact that one of the investigations relates to suspected arms smuggling, and that this has been referred to the court for prosecution.

The same article reported on a press release from Lithuania’s Financial Crime Investigation Service of yesterday, which stated that seven individuals and four companies are suspected of unlawful exports to Russia valued at nearly €2 million. Searches of 18 different premises have been conducted as part of this investigation.

It is alleged that attempts were made to mask the unlawful exports with false declarations naming different goods, as well as false destinations for the exports to Turkey, Kazakhstan, Uzbekistan, Belarus.

Details of the other ongoing investigations were not provided.

August 14, 2024 by Mark Handley

Switzerland – investigation into suspected breaches of Russian asset freeze

It is being reported that the Office of the Attorney General in Switzerland has opened criminal and administrative proceedings as part of investigations into suspected breaches of the asset freeze imposed on Suleyman Kerimov under Swiss sanctions.

It is being reported that SECO has confirmed that the criminal proceedings were commenced in November 2023 and that four individuals are under suspicion, as well as that eight premises have been raided so far.

Assets worth SWF 1.3 billion have also been made subject to a “super-provisional” asset freeze.