Episode 175

28th July – 31st July 2025

Sanctions

US Treasury Sanctions Venezuela's Cartel de los Soles for Narco-Terrorist Ties

On 25th July 2025, the US Department of the Treasury designated the Venezuela-based Cartel de los Soles—led by Nicolas Maduro—as a Specially Designated Global Terrorist organisation. The cartel is accused of materially supporting the Tren de Aragua and Sinaloa Cartel, both identified as violent narco-terrorist groups engaged in drug trafficking, human smuggling, and exploitation. The sanctions freeze US-based assets linked to the cartel and restrict transactions involving US persons. The move underscores continued efforts to disrupt transnational criminal networks threatening US national security.

Ukraine Aligns Sanctions with EU in Latest Decrees Targeting Russia

Ukrainian President, Volodymyr Zelenskyy, has signed two decrees tightening sanctions on Russia. One synchronises Ukraine's measures with the EU’s 18th sanction packages—including restrictions on shadow tanker fleets and dozens of Russian, Chinese, and Iranian entities. The second targets over 90 Russian companies involved in extracting rare-earth and critical metals crucial to military production. Zelenskyy emphasised coordinated pressure as the most effective path to ending the war.

EU Renews Terrorism Sanctions List

On 29th July 2025, the Council of the EU renewed its Terrorist List, maintaining sanctions on 13 individuals and 22 groups involved in terrorism. One deceased individual was delisted. Measures include freezing assets and prohibiting financial support by EU operators. This list operates independently of sanctions targeting groups like ISIL, Al-Qaida, and entities linked to Hamas or Palestinian Islamic Jihad.

Money Laundering

EBA Warns of Rising Financial Crime Risks Amid Digital Innovation

The European Banking Authority (‘EBA’) has released its 2025 Opinion on money laundering and terrorist financing (‘ML/TF’) risks across the EU financial sector. Amid geopolitical changes, legislative reforms, and rapid digitalisation, new vulnerabilities are surfacing, prompting concern over the misuse of innovative technologies in compliance processes.

Key findings highlight that 70% of regulators identify growing ML/TF risks, particularly in FinTech companies which often prioritise growth over compliance. RegTech tools—although potentially beneficial—have been implicated in over half of serious failures reported to the EBA, usually due to poor implementation and lack of oversight.

The crypto-asset sector remains high-risk, with a 2.5-fold increase in authorised service providers between 2022 and 2024. Many lack robust AML/CFT frameworks, and some actively evade regulatory scrutiny. Meanwhile, criminals are exploiting AI to automate laundering schemes and forge documents, leaving financial institutions struggling to respond effectively.

The Opinion also points to complexities in enforcing EU sanctions, as many institutions are unprepared to manage restrictive measures. To address this, new EBA Guidelines aiming for regulatory consistency will come into force by end-2025.

The report was issued under Article 6(5) of the Fourth EU Anti-Money Laundering Directive and will inform both the European Commission’s Supranational Risk Assessment and national-level policy responses.

Bribery and Corruption

Romanian Deputy PM Quits Amid Bribery Scandal Linked to Tax Authority

Romania’s Deputy Prime Minister, Dragoș Anastasiu, resigned just weeks into his role overseeing tax reform, following revelations that his companies paid over €150,000 in bribes to a tax inspector between 2009 and 2017. Although he was not charged, Anastasiu admitted the payments were made under pressure and described them as “survival bribes” rather than for personal gain. The scandal has undermined his credibility in leading reforms at the very agency implicated, prompting his decision to step down amid growing public scrutiny and political tension.

Former Colombian President Uribe Convicted of Witness Tampering

Álvaro Uribe, Colombia’s former president, has been found guilty of witness tampering and bribery after a nearly six-month trial. Prosecutors proved that Uribe conspired with a lawyer to influence testimony from imprisoned ex-paramilitary members, seeking to undermine accusations of his ties to paramilitary groups. The case stemmed from a 2012 libel suit Uribe filed, which ultimately led to his own investigation. He faces up to 12 years in prison, pending sentencing and appeal.

The ruling has sparked political clashes, with critics citing human rights abuses during Uribe’s presidency, while supporters—including US Secretary of State Marco Rubio—denounce the verdict as politically motivated. Colombian President Petro defended judicial independence, calling it a step toward peace and accountability.

ICAC Champions Youth Integrity at First-Ever ASEAN Anti-Corruption Training

In July 2025, the Hong Kong ICAC co-hosted a landmark regional training in Thailand, aimed at empowering ASEAN youth to combat corruption. Over 200 representatives from seven Southeast Asian nations joined the three-day programme, which spotlighted ICAC’s innovative youth engagement strategies—including social media campaigns and educational resources. The event featured student leaders, international anti-graft agencies, and the launch of a UNODC co-developed policy guide for meaningful youth participation in integrity work. ICAC underscored that these insights would drive future collaborative efforts to nurture a new generation of anti-corruption advocates across Asia-Pacific.

Fraud

Disaster Scams Surge: Americans Face Fraud in Wake of Natural Catastrophes

In the aftermath of natural disasters, fraud has become a growing secondary crisis across the United States. According to a July 2025 survey by the AICPA and Harris Poll, 37% of Americans report experiencing fraud attempts following a disaster—ranging from identity theft and contractor scams to charity fraud and government assistance fraud. FEMA echoes these concerns, warning that criminals often exploit survivors by impersonating officials, misusing stolen personal data to apply for aid, and soliciting fake payments for disaster grants.

The most vulnerable regions include the Northeast and South, where 40% of respondents reported fraud exposure. FEMA emphasises that official inspectors never request financial information, and any suspicious activity should be reported immediately to law enforcement or FEMA’s fraud branch.

Ofcom Proposes Tougher Rules to Block Scam Calls from Abroad

Ofcom is ramping up efforts to protect UK residents from international scam calls which appear to come from trusted UK mobile numbers. These "spoofed" calls often trick people into answering by mimicking legitimate UK caller IDs—particularly mobile numbers which start with +447. Criminal gangs use this tactic to exploit victims' trust, especially when the call looks familiar.

A new proposal from Ofcom recommends telecom providers block or withhold caller IDs from roaming UK mobile numbers unless they can be verified. This marks a shift from the current exemption which allows these calls to go through so people abroad can contact loved ones. The move follows a surge in suspicious calls: 42% of phone users received one in just three months, and Ofcom’s research shows people are much more likely to answer UK-looking numbers over international or withheld ones.

Ofcom’s Policy Director, Marina Gibbs, emphasised the importance of ongoing collaboration with industry, noting that previous efforts already prevent around a million scam calls daily. Yet, she warned there is no silver bullet, and new strategies must continue evolving.

The consultation is open until 13th October 2025, with a decision expected in early 2026.

Cyber Crime

Operation Endgame Targets Global Cybercrime: Europol Leads Botnet Crackdown

Operation Endgame is a major international initiative—led by Europol, Eurojust, and law enforcement agencies from nine countries—aimed at dismantling criminal infrastructures behind botnets and ransomware. Running since May 2024, this coordinated effort focuses on:

·         Disrupting botnets used to launch ransomware and cyberattacks.

·         Neutralising droppers—malware which facilitates further infections.

·         Seizing illicit assets, including cryptocurrency.

·         Uncovering connections between online aliases and real-world identities.

The operation highlights how emerging technologies are being misused by cybercriminals, and the scale of global cooperation needed to combat this evolving threat.

UK Moves to Curb Ransomware Payments and Boost Reporting

The UK government has responded to a recent consultation with plans to reduce funds flowing to ransomware criminals and improve reporting of cyberattacks. Proposed legislation focuses on deterring payments, strengthening intelligence-gathering, and enabling more effective disruption of ransomware actors.

The Digital Battlefield: Why Cyber Attacks Haven't Won Wars (Yet)

Imagine a modern battlefield where invisible digital strikes could decide the fate of nations. That is the promise, or threat, of offensive cyber-attacks in conventional warfare. Yet, as an article published this week has identified, despite the buzz, these attacks have not proven decisive in winning wars or leading to an aggressor's favourable outcome. The article is Offensive Cyber Attacks and Conventional Warfare by Matthew F. Calabria, and I thought it worth sharing some of the ideas expressed in it, especially as the article is lodged behind a paywall.

The article presents a valuable case against their current effectiveness:

• A Track Record of Underperformance: Historically, cyber-attacks have not vanquished peer-level adversaries or caused total defeat. For instance, Russia employed large-scale cyber offensives against Georgia in 2008 and Ukraine in 2015 and 2022, but these cyber operations were not major determinants of the war's trajectory. The battles in Ukraine, for example, have been won by conventional means like drones, artillery, and ground combat power, not cyber "blitzkriegs".

• Operational Challenges: Cyber-attacks are often scattershot, unfocused, and ineffective against hardened military systems. They require extensive preparation, precise execution, and bespoke malware, which can often be used only once before being neutralised. Integrating them effectively with fast-paced conventional military operations has proven challenging, as seen in Ukraine. No major power has demonstrated the ability to inflict significant casualties on an opposing force through cyber hacks, which suggests this capability against cutting-edge military hardware is "implausible" at present.

• The Defence is Getting Stronger: A key reason for cyber offence's limited impact is that success has often been due to poor cybersecurity rather than superior attacks. However, cybersecurity is rapidly improving globally, with new technologies like zero-trust architectures, AI-driven anomaly detection, and quantum-resistant encryption making critical systems harder to infiltrate. The cybersecurity market is even forecast to reach $425 billion by 2030, indicating a massive investment in defence.

However, the article also argues for the persistent, albeit evolving, utility and future potential of cyber weapons:

• Strategic Utility and Operational Advantages: While not battlefield decisive, cyber operations have a proven strategic utility, especially in "softer," below-the-threshold activities, and when combined with other national power elements. They offer operational advantages such as being cheap, quickly deployable, unattributable, surprising, and scalable, making them a "tool of first resort" for aggressors.

• Preparing the Battlespace: Cyber-attacks are most useful for preparing the battlespace before major conflict, weakening adversaries, creating divisions, and fostering distrust within the target population. States are already seeking to "pre-position" themselves on critical infrastructure networks for future crises.

• Evolving Capabilities and Vulnerabilities: Offensive cyber capabilities are constantly improving, particularly in their ability to target physical systems and trigger cascading effects in the real world, raising concerns about a "cyber-Pearl Harbor". Operational Technology (‘OT’) systems, which control physical infrastructure like energy grids, are increasingly vulnerable.

• Future "Game Changers": The blurring lines between cyber offence and defence, combined with emerging technologies like Artificial Intelligence (‘AI’) and quantum computing, could transform the landscape. AI could help attackers analyse exploitation pathways and integrate cyber weapons with conventional forces.

• Conditions for Decisive Impact: The article identifies three conditions where cyber-attacks could become decisive:

1. Tactical effects delivering strategic results: If cyber-attacks can move beyond small hacks to subdue entire civil societies or infrastructure, or break an opponent's will to fight, especially when enhanced with AI or quantum computing.

2. Real-time operational integration: Dedicated, integrated cyber units could slow defensive forces or reduce retaliation prospects at crucial moments in a conflict.

3. Offensive outpacing defensive technology: Just as tanks evolved from lumbering hulks to decisive, offensive cyber technologies could eventually outpace defensive ones, particularly if applied as a surprise attack early in a war.

In conclusion, while cyber-attacks currently remain "niche assets" best suited for pre-conflict operations rather than direct means to victory, policymakers must temper expectations while also acknowledging the potential for powerful offensive cyber capabilities to reshape conventional warfare in the future.