Episode 161

9th June – 12th June 2025

Sanctions

US Imposes Sanctions on ICC Judges Over Actions Against United States and Israel

The United States has imposed sanctions on four International Criminal Court (‘ICC’) judges in response to the court's investigations and actions against the US and Israel. The sanctions, authorised under Executive Order 14203, target judges who have been directly involved in investigations and prosecutions against American and Israeli personnel.

The sanctioned judges are Solomy Balungi Bossa and Luz del Carmen Ibanez Carranza, who authorised an investigation into US personnel in Afghanistan, and Reine Adelaide Sophie Alapini Gansou and Beti Hohler, who authorised arrest warrants for Israeli Prime Minister Benjamin Netanyahu and former Minister of Defence Yoav Gallant. These sanctions will result in the blocking of the judges' property and interests within the United States and will prohibit any transactions with them. For its part, the European Union and the United Nations have come out in support of the ICC.

US Sanctions vast Iranian "Shadow Banking" Network

The United States has imposed sanctions on a sprawling Iranian "shadow banking" network, encompassing over 35 individuals and entities. This network, masterminded by the Zarringhalam brothers, is accused of laundering billions of dollars for the Iranian regime. The operation facilitated the illicit sale of Iranian oil and other commodities, funnelling the proceeds to fund Tehran's nuclear and missile programs, as well as its network of terrorist proxies.

The sanctions target a complex web of Iranian exchange houses and front companies located in the United Arab Emirates and Hong Kong. These entities were instrumental in helping designated Iranian persons and entities evade international sanctions and access the global financial system. In a coordinated action, the Treasury Department's Financial Crimes Enforcement Network (‘FinCEN’) has updated an advisory to help financial institutions identify and report suspicious transactions linked to Iran's illicit financial activities. This move underscores the US commitment to disrupting Iran's destabilising activities by denying it access to the international financial system. The State Department, OFAC, and FinCEN press releases are linked.

US Treasury Sanctions Los Chapitos, Fentanyl-Trafficking Faction of Sinaloa Cartel

The US Treasury’s Office of Foreign Assets Control (‘OFAC’) has sanctioned Los Chapitos, a violent faction of the Sinaloa Cartel responsible for fentanyl trafficking into the United States. The sanctions target two fugitive leaders, Archivaldo Ivan Guzman Salazar and Jesus Alfredo Guzman Salazar, sons of jailed cartel boss Joaquin "El Chapo" Guzman Loera. The US State Department has offered rewards of up to $10 million for their arrest. Additionally, OFAC has designated regional affiliates involved in drug trafficking, extortion, and money laundering. The sanctions aim to disrupt illicit fentanyl production and cartel activities under Executive Orders 14059 and 13224.

US Treasury Targets Hamas and PFLP’s Sham Charities in Global Terror Financing Crackdown

The US Treasury’s Office of Foreign Assets Control (‘OFAC’) has imposed sanctions on five individuals and five overseas charities found to be financing Hamas's Military Wing and the Popular Front for the Liberation of Palestine under the guise of humanitarian aid. These organisations, operating in regions including Gaza, Türkiye, Algeria, and the Netherlands, secretly funnelled funds to terrorist groups while misleading international donors. The Treasury’s action aligns with broader counterterrorism efforts, highlighting the persistent misuse of nonprofit organisations for illicit financial activities. The sanctions block the assets of those designated and prohibit US transactions with them, reinforcing the US administration’s commitment to combatting global terrorist financing networks.

Founder of Crypto Payment Firm Charged with Laundering Over $500m for Sanctioned Russian Banks

Iurii Gugnin, founder of Evita Investments, faces a 22-count indictment for allegedly laundering more than $500 million through US banks and cryptocurrency exchanges to aid sanctioned Russian banks and facilitate restricted tech purchases. Authorities claim Gugnin used crypto transactions to obscure fund sources, bypass sanctions, and acquire sensitive US electronics for Russian entities, including Rosatom. He allegedly falsified compliance reports and conducted online searches about criminal investigations. If convicted, he faces decades in prison for fraud, sanctions violations, and money laundering.

OFSI Updates Main Sanctions Website

In the UK, the Office of Financial Sanctions Implementation (‘OFSI’) has updated its main website, drawing on the information produced across all government departments with sanctions obligations.

Five Nations Sanction Israeli Ministers over Settler Violence

The foreign ministers of Australia, Canada, New Zealand, Norway, and the UK have announced sanctions and other measures against Israeli ministers Itamar Ben-Gvir and Bezalel Smotrich for inciting violence against Palestinians in the West Bank. The joint statement condemns extremist rhetoric that encourages displacement, settlement expansion, and human rights abuses, asserting that such actions undermine both regional stability and Israel’s own security. The measures focus on accountability while reaffirming support for Israel’s security and calling for a two-state solution. The statement also highlights the humanitarian crisis in Gaza, emphasising the urgent need for aid, a ceasefire, and the release of hostages. The OFSI Notice and Foreign Office press release are available. The United States has condemned the decision.

Money Laundering

EU Updates List of High-Risk Third Countries for Financial Crime Controls

The European Commission has revised its list of third countries considered high-risk for money laundering and terrorist financing. The updated list aligns with FATF recommendations and strengthens EU efforts to mitigate financial crime risks. Countries identified as high-risk must implement enhanced due diligence measures for financial transactions involving EU entities. The Commission emphasises that these updates reinforce the bloc’s commitment to combating illicit financial flows while ensuring a robust regulatory framework. Notable among the additions is Monaco, which was trailed as being added last week, and now it has happened. Monaco is already on the FATF grey list, but it has set out a compliance roadmap, though lingering regulatory gaps have hindered its removal from the FATF grey list, to which it was added in June 2024.

Art Dealer Jailed in Landmark Case for Failing to Report Sales to Suspected Terrorist Financier

An art dealer has been imprisoned for two and a half years after failing to report the sale of nearly £140,000 worth of art to a suspected terrorist financier. Oghenochuko Ojiri was sentenced after pleading guilty to offences under the Terrorism Act 2000.

Ojiri sold the artwork to Nazem Ahmad, who is suspected of financing the proscribed group Hizballah. Despite being aware of both the regulations and Ahmad's background, Ojiri proceeded with the sales and actively concealed the purchaser's identity by altering invoices and using an alias.

The investigation is considered a landmark case and the first of its kind. The conviction highlights the importance of the art market's role in preventing terrorist financing and the legal duty of dealers to report suspicious transactions. As a result of the investigation, artwork belonging to Ahmad with a value of almost £1 million was seized. Press releases from the Crown Prosecution Service and the Metropolitan Police are available.

Bribery and Anti-Corruption

Argentina’s Anti-Corruption Office Clears Milei in LIBRA Scandal

Argentina’s Anti-Corruption Office has ruled that President Javier Milei did not violate ethics laws when endorsing the LIBRA memecoin in a 14th February social media post. The watchdog stated that Milei acted in a personal capacity and did not use public resources, dismissing allegations of misconduct. The endorsement, which coincided with a sharp rise and crash in LIBRA’s value, led to investor losses totalling $251 million, prompting political backlash and calls for impeachment. Despite the watchdog’s decision, a federal criminal court continues its investigation into Milei’s involvement in the controversy.

Argentina’s Anti-Corruption Office (Oficina Anticorrupción, OA) is formally a decentralised agency within the Ministry of Justice and Human Rights. While it is tasked with auditing the public sector and implementing anti-corruption policies, a report in 2021 indicated that it, along with two other agencies, lack functional and financial independence effectively to perform their duties.

Insurance broker appears in court

The latest stage in the prosecution of United Insurance Brokers Ltd (‘UIBL’) occurred this week. UIBL is charged with failing to prevent international bribery in Ecuador, contrary to section seven of the Bribery Act 2010. Between 2013 and 2016, UIBL’s US-based intermediaries allegedly paid bribes to secure re-insurance contracts worth $38 million, with $3 million of a $6.2 million commission reportedly funnelled to an Ecuadorian official. If contested, this will be the first “failure to prevent bribery” case tried by a jury in the UK, with trial scheduled for 2027.

Krasnoyarsk Mayor Arrested on Bribery Charges

Vladislav Loginov, the mayor of the Siberian city of Krasnoyarsk, was arrested on 9th June 2025. He is suspected of accepting bribes totalling over 180 million roubles (approximately $2.3 million) between 2018 and 2024. The alleged bribes were reportedly received from the CEO of a private company in exchange for ensuring the company won municipal contracts for road repair, infrastructure, and urban development. According to Russia's Investigative Committee, these illicit payments took the form of cash and the construction of a private bathhouse on land owned by Loginov. This case represents a high-profile instance of alleged public sector corruption in a major Russian city.

The arrest of Mayor Loginov does not appear to be an isolated incident. It follows previous accusations levelled by the local branch of the Liberal Democratic Party, which had accused him of involvement in alleged corruption schemes related to public transit, garbage collection, and tree removal. Furthermore, there have been earlier arrests of individuals reportedly connected to Loginov and municipal contracting schemes, including a businessman, Dekard Khanagyan, and one of the mayor's advisers, Artur Arutyunyan. This sequence of events suggests that the mayor's arrest may be part of a larger investigation into a potentially systemic corruption network operating within the Krasnoyarsk municipal administration. The investigation seems to have been developing over a considerable period, culminating in this recent high-profile action. This could be indicative of broader anti-corruption efforts within Russia or, alternatively, could reflect underlying political power struggles.

The nature of the alleged bribes—cash payments and in-kind benefits such as the construction of a private bathhouse —is a classic manifestation of corruption. Such methods are often more challenging to trace and prove than direct financial transfers into bank accounts. Cash transactions offer anonymity, while in-kind benefits can obscure the direct link between the corrupt payment and the official action. This highlights the enduring methodologies of bribery, which persist even in an increasingly digitised world, and underscores the investigative challenges in uncovering and prosecuting such schemes. Proving the quid pro quo for these types of benefits often requires extensive witness testimony, forensic accounting of the company providing the benefit, and meticulous tracing of non-financial assets. This case serves as a reminder that anti-corruption efforts must remain vigilant against these traditional forms of bribery alongside more modern, technologically enabled corruption.

US Justice Department Scales Back Foreign Bribery Investigations and Resumes Enforcement

The US Justice Department's unit dedicated to investigating foreign bribery cases has significantly shrunk under President Trump's administration, dropping from 32 prosecutors to around 15. This reduction follows Trump's executive order pausing enforcement of the Foreign Corrupt Practices Act (‘FCPA’), a key anti-corruption law. Many prosecutors have moved to other divisions, while new guidelines on handling FCPA cases have been issued such that enforcement is resumed, but with a more selective approach. Under new guidelines from Deputy Attorney General Todd Blanche, the DOJ will focus investigations on cases affecting US firms' competitiveness, critical infrastructure, and transnational crime. All new investigations now require high-level approval. Additionally, corporate monitorships are being reassessed, with some being discontinued. DOJ officials stress that combating white-collar crime remains a priority, but the new framework aims to reduce compliance burdens on US businesses.

Congresswoman Emilia Sykes Introduces Bill to Close Bribery Loopholes in US Politics

Representative Emilia Sykes has unveiled the "Closing Bribery Loopholes Act," aimed at expanding the legal definition of bribery to target corrupt politicians more effectively. The bill seeks to cover a broader range of official acts used for personal gain, including promotional events on public property. This legislation is part of a broader anti-corruption initiative which includes banning Congress members from lobbying post-service and restricting stock trading by elected officials and their families. Sykes cites the FirstEnergy bribery scandal—one of Ohio’s largest—as a key motivator behind the bill.

Market Abuse

FCA Spearheads Global Crackdown on Illegal 'Finfluencers'

The UK's Financial Conduct Authority (‘FCA’) has taken the lead in a coordinated international effort to combat illegal financial promotions by "finfluencers" on social media. Working with nine regulatory bodies from around the world, the crackdown has resulted in a range of enforcement actions, including arrests, the initiation of criminal proceedings, interviews with individuals of concern, and the issuance of ‘cease and desist’ letters and warning alerts.

The FCA is sending a clear message that those who promote financial products must be authorised to do so. The regulator is also urging consumers to be vigilant and to protect themselves from potential harm. Before acting on any financial advice seen online, consumers are strongly advised to consult the FCA's Warning List and make use of the resources available on its InvestSmart page. This international initiative signals a growing focus by regulators on the risks associated with the rise of financial influencers and the potential for consumer harm in the digital age.

Other Financial Crime News

Sri Lanka to end Secret Company Ownership with New Law

Sri Lanka is set to amend its Companies Act, a move which will put an end to the practice of secret beneficial ownership of companies. This new legislation is being introduced to meet a structural benchmark set by the International Monetary Fund (‘IMF’) and to align the country's legal framework with the Financial Action Task Force (‘FATF’) standards for combating money laundering and terrorist financing.

Under the proposed amendment, companies will be required to disclose the details of their beneficial owners. This information, which will be accessible to the public upon request to the Registrar of Companies, will include the full name, date and place of birth, nationality, country of residence, and other identification details of the beneficial owner. The failure to provide this information or the submission of false details will be treated as a criminal offence.

Cybercrime

Legal Aid Agency Data Breach Exposes Thousands of Applicants' Personal Information

The UK Legal Aid Agency suffered a cyber-attack which compromised sensitive data from applicants dating back to 2010. Initially detected on 23 April, the breach was later found to be more extensive, including personal details such as addresses, national ID numbers, criminal history, and financial records. The agency has taken its online service offline and is working with cybersecurity authorities. Legal aid applicants are urged to remain vigilant against identity fraud. An injunction prohibits sharing the leaked data.

M&S Resumes Online Orders after Cyber-Attack Disruption

Marks & Spencer has reopened its online store after a six-week shutdown caused by a cyber-attack attributed to hacking group Scattered Spider. The retailer had been losing an estimated £25m per week due to halted clothing and homeware orders, with total losses projected to reach £300m, partly offset by insurance. Some online services, including Northern Ireland deliveries and international orders, will resume in the coming weeks. M&S confirmed that personal data of thousands of customers was stolen in the attack. CEO Stuart Machin stated that the company will accelerate a planned three-year digital overhaul to enhance cybersecurity. The attack follows similar incidents targeting UK retailers, including Co-op and Harrods, highlighting growing cyber risks in the sector.