Episode 284

25th September – 27th September 2026

Sanctions

UK OFSI Establishes Presumption of Denial for Licence Applications Involving Designated Iranian Banks

The UK Office of Financial Sanctions Implementation (OFSI) has published new licensing guidance establishing a "presumption of denial" policy for financial sanctions licence applications submitted by five designated Iranian banks operating in the UK: Bank Sepah, Melli Bank plc, Bank Saderat, Persia International Bank, and Bank Tejarat. Designated under the Iran (Sanctions) (Nuclear) (EU Exit) Regulations 2019, applications involving these institutions will generally be refused unless applicants demonstrate exceptional circumstances, such as specific legal requirements or urgent risks to life, limb, or environmental safety, with strict restrictions prohibiting cash payments, transfers between designated banks, or remitting funds back to Iran. Additionally, OFSI confirmed that the Iran Interim Basic Necessities General Licence (INT/2025/7628424) will not be renewed upon its expiration on 22nd October 2026, forming part of broader UK government measures to restrict Iranian access to the UK financial system following the UN sanctions snapback in October 2025.

OFAC Consolidates Sanctions Penalty Regulations, Removes Obsolete Syria Licensing, and Releases Q2 2026 TSRA Report

The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) has issued a tripartite regulatory update consolidating its enforcement and penalty provisions, amending Syria-related rules, and releasing quarterly humanitarian trade licensing data. Under the administrative overhaul, OFAC established a new, centralised "Sanctions Penalties Regulations" framework to unify enforcement procedures and penalty information across 31 CFR chapter V, resulting in the removal of more than 100 redundant subparts]. Concurrently, OFAC amended the Terrorism List Governments Sanctions Regulations to remove and reserve a Syria-specific general licence which was rendered obsolete following the rescission of Syria’s designation as a State Sponsor of Terrorism. Finally, the agency published its Section 906(b) quarterly report under the Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA) covering licensing activities from April through to June 2026 for exports of agricultural commodities, medicine, and medical devices to Iran.

Money Laundering

FCA Multi-Firm Review Urges Financial Institutions to Strengthen Defences Against Evolving Money Mule Networks

The UK Financial Conduct Authority (FCA) has announced the publication of a multi-firm review detailing trends in money mule activity and cash-out mechanisms across 35 regulated financial institutions. The review revealed that while firms closed 238,396 suspected money mule accounts in 2025, up from 184,935 in 2023 and 233,269 in 2024, organised criminal networks continue to move fraudulent funds through complex, multi-account chains. The FCA found that cash-out activity is heavily concentrated between the second and fifth mule accounts, primarily executed via card payments for lower-value transactions and international transfers or cryptoassets for higher-value movements. Demographically, customers aged 18 to 39 represented nearly 72% of offboarded mule accounts, though the sharpest rise in account closures occurred among individuals aged 40 to 49. To disrupt established laundering infrastructures earlier, the regulator instructed firms to strengthen monitoring controls beyond initial receiving accounts and expand cross-institutional intelligence-sharing under the Economic Crime and Corporate Transparency Act 2023.

Fraud

US Federal and State Enforcement Actions Yield Convictions and Sentences in Multi-State Tax and Wire Fraud Schemes

US federal and state enforcement authorities have secured guilty pleas and custodial sentences across three separate fraud prosecutions in Indiana, Maryland, and South Dakota. In Indiana, 51-year-old Tanya Januszewski was sentenced to 15 months in federal prison and ordered to pay $481,197 in restitution for wire fraud after creating hundreds of false electronic transaction records and stealing matching cash while working as a cashier for a northwest Indiana scrap metal business between October 2022 and June 2024. In Maryland, Robert David Michael, 56, owner of B & E Motorsports, LLC, pleaded guilty to a felony theft scheme, identity fraud, perjury, and filing false tax returns for creating falsified sales paperwork on jet skis, dirt bikes, and trailers between July 2018 and June 2025 to underpay state excise and sales taxes, agreeing to an 18-month active jail sentence, $170,450.07 in state restitution, and a $25,000 fine. Meanwhile, in South Dakota, Amon Eustache Aboua has been sentenced to 33 months in federal prison and ordered $540,267.43 in federal tax restitution, alongside $232,600 in overdue child support, for operating ACU Tax Services and filing over 500 fraudulent tax returns with falsely inflated deductions between 2018 and 2019 to enrich himself. Next, in Iowa, authorities have recovered $372,583.77 in fraud proceeds following a business email compromise scam. And, finally, four men from Massachusetts have been arrested and indicted on charges of bank fraud conspiracy and money laundering conspiracy. Prosecutors alleged that between 2023 and 2026, the defendants coordinated the theft, alteration, and fraudulent deposit of over $12.2 million in stolen US Treasury cheques through shell company accounts, using proceeds to purchase $310,000 in luxury watches and finance a $425,000 real estate loan in Nantucket.

Other Financial Crime

NCA Director General Highlights Rising Online Fraud, Crypto Laundering, and Police Reform in 2026 Strategic Assessment

The UK National Crime Agency (NCA) Director General, Graeme Biggar, has delivered the launch address for the National Strategic Assessment 2026, warning that technological advancements are rapidly accelerating and globalising serious organised crime across the UK. Focusing on financial crime, Biggar highlighted the expansion of investment fraud, card-not-present schemes, and industrial-scale scam centres in South East Asia and West Africa which manipulate victims into transferring funds. The assessment noted that money laundering networks are increasingly interconnected, leveraging cryptocurrencies and digital infrastructure to serve a converging mix of criminal syndicates, terrorist organisations, and hostile foreign states. Pointing to recent achievements, such as preventing over 400,000 frauds and increasing convictions by 27%, Biggar endorsed UK police reform plans to create a unified National Police Service (NPS), recommending that national fraud leadership functions currently handled by the City of London Police be integrated into the new agency to consolidate specialised financial analysis and digital intelligence capabilities. The Assessment can be read here.

Cybercrime

ESAs Warn of AI-Driven Cyber Threats and Non-EEA ICT Dependencies in Joint Financial Risk Assessment

The European Supervisory Authorities (EBA, EIOPA, and ESMA) have issued their Autumn 2026 joint risk assessment, warning that heavy reliance on non-EEA Information and Communication Technology (ICT) service providers and the rapid advancement of artificial intelligence are escalating operational vulnerabilities across the EU financial sector. The regulators cautioned that advanced AI systems enable malicious actors to execute more powerful cyberattacks and exploit software weaknesses at unprecedented speed and scale, compounding concentration risks and threatening underwriting accumulation for cyber-insurers. Additionally, the ESAs flagged emerging risks from quantum computing, which could undermine standard cryptographic frameworks used to secure financial communications, databases, and transaction networks. In response, the Joint Committee urged national supervisors and financial market participants to manage third-party vendor dependencies, upgrade threat preparedness, and strengthen technological resilience against AI-driven cyber threats.