FATF on Sanctions and Export Controls Evasion

🚀 FATF just published a report highlighting various sanctions and export controls evasion schemes, including:

• Enlisting intermediaries in third countries

• Obscuring UBO details to access the financial system

• Using virtual assets and “new” technologies

• Exploiting maritime and shipping sectors

💡 Case studies in the typology section show how various parties perpetrate the above.

⚠️ Risk indicators in Annex A highlight customer behavior, transactions and trade activities that may call for greater scrutiny.

This week’s coffee-chat stories:

• Structuring transactions to violate the US sanctions regime: Former CEO of Unicat Catalyst Technologies, a Texas-based manufacturer, structured transactions to knowingly violate the US sanctions regime on Iran and Venezuela.

• Taiwan tightens export controls: Taiwan added Huawei and SMIC to its Entity List. Local firms will be required to obtain gov approval ahead of shipping tech/materials/materials.

• Managing funds for sanctioned Russia persons: GVA Capital, a San Francisco VC firm, knowingly managed investments for sanctioned Russian oligarch and his proxies. 50% Rule did not apply. USD 216m fine (statutory maximum).

• Stablecoin regulation and the GENIUS Act: the United States senate passed stablecoin legislation. This ensures USD dominance (~97% are USD denominated, as of today).

• UK Digital ID: Downing street is exploring proposals for a digital ID card (BritCard app), meant to facilitate “right-to-rent” and “right-to-work” checks.