It is being reported that the University of Tampere in Finland has asked the police to investigate a suspected breach of sanctions “at the institution”.
The suspicions relates to potential breach of sanctions as well as export controls on dual-use goods. The particular sanctions regime involved is not specified in the material that is public.
Little other information is available including whether the suspicions relate to staff or students.
It is being reported (here and here) that the German authorities have conducted raids on business and residential premises in the town of Königswinter in relation to a criminal investigation into the alleged exports of luxury cars to Russia shipped through third countries.
The raids are said to have taken place in late September and a criminal case has been opened. Cars, cash and evidence were all seized as part of the raids.
The sales are alleged to have totalled more than €4 million.
Further to our post of yesterday about an individual sentenced to 32 months for exporting aircraft parts to Russia in breach of EU sanctions, the Rotterdam District court has released a second judgment for the conviction of the company involved.
The company has been sentenced to pay a fine of €165,826. The prosecutor was seeking a fine of all the funds in the company’s bank accounts at the time it was raided, but it is unclear from the judgment whether the fine is that sum.
The company is not named in the judgment.
On 3 October 2024, the District Court in Rotterdam sentenced an individual to 32 months in jail, as well as confiscation of $8,000 and €250,000 in cash, as well as the forfeiture of all the stock-in-trade and business bank accounts.
The individuals had exported over 460 prohibited aircraft parts to three different Russian airlines: i) Ural Airlines; ii) S7 Engineering LLC; and iii) JSC Siberia Airlines.
The defendant had created a paper trail to mask the destination of the exports which purported to show exports to Serbia, Turkey and Tajikistan. Internal documents, however, linked the exports to the Russian customers.
Messages on seized phones included: “We’re going to keep loading until we’re arrested”.
The Dutch Prosecution Service has issued a press release stating that they are seeking a sentence for a 42-year old individual consisting of:
i) a 24 month custodial sentence of which 10 months is suspended;
ii) confiscation of all the proceeds of crime obtained from the breaches of sanctions; and
iii) forfeiture of the company’s stock.
As per our earlier posts the man was arrested in July 2023, for exports of electronic components and other dual use goods to Russia via Kyrgyzstan, Uzbekistan and Kazakhstan. The man is also alleged to have falsified records to mask the true destination of the exports.
In May this year the man had won a court hearing allowing his company to keep trading pending trial.
Details of confiscations conducted by Estonia’s Customs office have been reported including the confiscation of goods being exported to Russia at border crossings in breach of EU sanctions. The confiscations include €3,275,295 in cash, electronics parts and equipment, a Starlink antenna, drones, night vision goggles, firearms and ammunition, as well as consumer goods such as jewelry, wine, and diving equipment.
It is also being reported that some of the confiscations are now the subject of ongoing investigations.
It is being reported, based on Freedom of Information requests made to Norway’s custom office by the Barents Observer, that 23 confiscations of luxury and other goods being exported to Russia have taken place since 2023.
One of the confiscations was at an unspecified port, and the other 22 were at the land crossing at Storskog, with 10 during 2023 and 12 so far in 2024.
The reporting makes no mention of other enforcement actions taken after the confiscation.
It is being reported that German authorities in the city of Karlsruhe have arrested two individuals. The individuals were husband who is a German national and wife of Ukrainian nationality.
It is alleged that they made available internet access to the sanctioned broadcasting channels Rossiya-1 and Russia Today. EU sanctions prohibit for a person “to broadcast or to enable, facilitate or otherwise contribute to broadcast” of these channels.
Raids on the couple’s home gathered evidence and €40,000. The authorities also obtained a freezing order over a bank account containing €120,000.
With the news of OFSI imposing a civil penalty, Europe has today hit its 300th successfully-concluded enforcement action in relation to trade and financial sanctions and export controls since the start of 2017.
To mark the occasion we are publishing updated enforcement graphs which we last posted back in January when this blog first went live.
Total number of fines/penalties/convictions: 2017-2024
As the graph shows 2024 has, to date, been the most prolific in terms of sanctions enforcement in recent years with 69 so far this year. Already there have been three times as many successfully-concluded enforcement actions in Europe in 2024 as there were in 2017.
Total value of fines/penalties: 2017-2024
While the volume of enforcement has increased, the shape of this graph illustrates that the value of the fines imposed did not keep pace in the years following when the UK and French financial services regulators having imposed fines of £102m, €50m, and £38m.
After several years of plateau 2024 is, however, showing signs of acceleration with fines of over €32m imposed so far this year – more than double the figure for 2023.
Russian / Belarusian sanctions enforcement
Focusing just on enforcement of the sanctions against Russia and Belarus, perhaps unsurprisingly, the picture varies across Europe, although the total of 111 examples to date is worth stressing in and of itself.
This graph includes only enforcement actions that have concluded with a fine, penalty, conviction or confiscation. A total of 18 countries show no examples, although it is possible that there are such examples and they have not been made public. Poland, the Netherlands, Switzerland and Latvia are the only countries with more than 10 examples.
This is another way of looking at the same data. Again, this is specific to the Russia/Belarus sanctions, and is the number of concluded enforcements. This does not reflect the scale of the fines. A few countries dominate the picture.
Current investigations
Looking at publicly-available data on the number of current/live investigations reveals a similar picture. Many states appear to be currently inactive, while there are more than 2000 investigations which are reported as ongoing across Europe. That is a figure which bears repeating – more than 2000 ongoing regulatory/criminal sanctions investigations across Europe.
It should be remembered, however, that for most states such information has not been made public. In Germany alone nearly 2000 investigations have been started since early 2022, but the information is limited on how many of these remain active.
Back in July we published a post highlighting that Switzerland’s SECO had imposed 5 new fines for sanctions breaches.
Through a Freedom of Information request we have obtained anonymized and redacted copies of these five Final Administrative Criminal Decisions.
These five decisions, and machine-generated translations are provided below, as well as summaries of the enforcement actions. The numbering sequence from when this blog published the previous 10 decisions is continued.
As previously, the value of the fines are all fairly low and these five cases combine for a total of CHF 13,490.
11. Final administrative criminal decision, dated 19 February 2024
Original: 2024-02-19-I.77-Strafbescheid.pdf
Translation: 2024-02-19-I.77-Strafbescheid_Translation.pdf
This case concerned the attempted export of CHF 10,569.90 of electrical switches to Russia. The export was stopped at Zurich Airport Customs in December 2023.
The goods in question had been included on the Swiss sanctions list as of 25 January 2023.
The company claimed it was unaware the goods were sanctioned, and SECO accepted this finding that the export was negligent rather than intentional.
In light of the company’s cooperation, and the company being able to show a track record of refusing sales to Russia which they knew were sanctioned, SECO set the fine at CHF 750, plus CHF 250 in costs.
The goods in question were returned to the seller.
12. Final administrative criminal decision, dated 26 February 2024
Original: 2024-02-26-I.78-Strafbescheid.pdf
Translation: 2024-02-26-I.78-Strafbescheid_Translation.pdf
This case concerned the attempted export of €57,263 worth of pressure transmitters, pressure transducers and pressure gauges to Russia. The export was stopped at Zurich Airport Customs in December 2022.
The goods in question had been added to the Swiss sanctions list during November 2022.
SECO had earlier written to the company, in 2021, to say that the export of the goods could be done without a licence, subject to the changing requirements of Swiss sanctions.
SECO accepted the argument that the export was not intentional, but found it was negligent and that the company should have been more aware of the sanctions in place.
In light of the company’s cooperation, SECO set the fine at CHF 2,900, plus CHF 970 in costs.
The goods in question were returned to the seller.
13. Final administrative criminal decision, dated 26 February 2024
Original: 2024-02-26-I.67-Strafbescheid.pdf
Translation: 2024-02-26-I.67-Strafbescheid_translation.pdf
This case concerns two attempted exports of spare parts for medical and dental devices to Russia. Within wider sales of nearly €27,000 worth of parts, sanctioned goods with a value of approximately €3,600 were included.
On both occasions the goods were stopped by customs.
The company sought to explain the two prohibited exports by saying that the wrong HS code had been entered into its internal system (9026.2000 instead of 8481.1010) and so it had not been caught by its systems. In the other instance the company said it searched for the HS code using the format in the customs tariff (which used a full-stop in the number), while in the relevant Appendix in the Ordinance the HS code used a space instead of a full stop. The company’s searches against its products therefore resulted in false negatives and the shipments were incorrectly authorised.
The company relied heavily on its detailed procedures and training as mitigation, and had appointed an outside consultant to assist further with compliance. In addition, the company sought a retrospective approval for the exports on humanitarian/medical grounds.
SECO denied that request saying “a retroactive authorization cannot be issued to regularize exports”.
While not alleging an intention to breach the sanctions, SECO decided that the company had been negligent and commented that a “more precise check” of the prohibited codes would have prevented the export. It is as good an example of the importance of fuzzy searching as you’ll find.
The company was fined CHF1,000 and costs of CHF590. The seized goods were returned to the company.
14. Final administrative criminal decision, dated 11 March 2024
Original: 2024-03-11-I.79-Strafbescheid.pdf
Translation: 2024-03-11-I.79-Strafbescheid_Translation.pdf
This case concerned two blocked exports of goods valued at €2000 which were stopped by the Zurich Customs office. The goods included foam generators and level sensors.
In the first example the attempted export took place on the same day as the respective goods were announced as being added to the lists of prohibited items. The version of Annex 23 to the Ordinance had been updated on SECO’s website, but not on other versions. Nonetheless, SECO determined that the export fell under the heading of “negligent”.
In the second example, the company argued that the prohibition against certain goods which are “suitable for use in the aerospace industry” could be negatived by evidence that this was not going to be the actual use. SECO disagreed.
The company was fined CHF2,300 and ordered to pay costs of CHF970. The seized goods were returned to the company.
15. Final administrative criminal decision, dated 13 March 2024
Original: 2024-03-13-I.76-Strafbescheid-002.pdf
Translation: 2024-03-13-I.76-Strafbescheid_translation.pdf
This case concerned a shipment of 8,640kg of products with customs code 3824.9919 valued at €19,612.80.
The goods were seized by the St. Gallen customs office in October 2022.
The company claimed that it had no knowledge that the goods in question were subject to Switzerland’s Russian sanctions.
SECO’s response was to state:
“However, it is not the actual knowledge of the persons concerned of the criminal nature of the sale and export transaction that establishes criminal liability, but it is sufficient if the knowledge of the criminal liability should have been present in the company with due diligence. This must be affirmed in the present case.”
SECO accordingly concluded that the company was guilty of a negligent breach of sanctions.
A fine of CHF2,800 was imposed and costs of CHF960. The seized goods were returned to the company.
