In a quiet month for sanctions, notwithstanding the usual few listings by the UK and EU, Russia largely avoided the focus of international regulatory bodies in August for a change. The US instead introduced several restrictions on those linked to Latin America’s cartels and Cuba’s government, whilst also issuing wide-ranging sanctions against Iran amidst broader counter terrorism measures. Early in the month the US made its single largest expansion to the list of entities banned under its Uyghur Forced Labor Prevention Act (UFLPA) in China’s Xinjiang region.
Enforcement, on the other hand, has seen a busy month. The US handed down fines and agreed settlements totalling over $162 million, including the largest penalty ever imposed on a broker-dealer for breaching the Banking Secrecy Act with a $125 million penalty handed to UBS Financial Services Inc. Two individuals in the US received prison sentences and two others pleaded guilty for breaching export controls during the month. Four US human rights groups have meanwhile joined the list of individuals and groups to challenge the legality of the US sanctions regime targeting the International Criminal Court.
Iran and Counterterrorism
- The US issued a new sanctions package against Iran, including sectoral sanctions on people who operate in aviation, digital assets, gold, shipping and technology in Iran. The package also listed 24 people, 48 entities, and six vessels for weapons procurement, cyber operations and oil-revenue generation networks for Iran. Reuters reported that the US has also threatened secondary sanctions on third countries that continue to trade with Iran.
- Outside the package, the US also added four people and seven entities that form a currency network helping Iran’s Shahr Bank recover oil revenue held overseas, as well as digital asset exchanges used to launder funds for the Islamic Revolutionary Guard Corps (IRGC). Among those designated was the Shelbit Exchange network, which had been identified by a Reuters investigation earlier in the month for allegedly processing at least $4 billion as part of a sanctions evasion scheme. Shelbit had reportedly interacted directly with Iran’s central bank and crypto wallets linked to the IRGC since May 2024. Dubai’s Virtual Assets Regulatory Authority previously took enforcement action against Shelbit in 2025, ordering it to cease unlicensed activity including money laundering and terrorism financing.
- Later in the month the US Treasury proposed a rule that would revoke Banque Misr UAE’s correspondent banking access to US financial institutions. On the same day OFAC sanctioned the manager of Bank Melli’s Dubai branch and a Hong Kong-based front company said to be laundering funds for a sanctioned Iranian exchange house.
- Under its counterterrorism sanctions regime OFAC designated a network of 10 people responsible for transferring cash to Hizballah, which was itself re-designated for its connection to Iran’s IRGC Qods Force. The US also added 2 people and 3 entities including UK-based Palestine Action and Italian anti-fascist group Autistici Inventati to its counterterrorism list for being “violent far-left terrorist groups.”
Other Designations
- The US Department of Homeland Security added 43 companies based in China to its UFLPA list. The companies spanned several sectors from metals and textiles to tomatoes and downstream products. Marking a 30% increase in total listings, this was the largest single addition to the list since the UFLPA was enacted. The UFLPA list now counts 187 entities.
- In the counternarcotics space, the US has continued exerting pressure on active cartels. The State Department imposed visa restrictions on 65 people linked to the Cártel de Jalisco Nueva Generación (CJNG). OFAC targeted eight people, seven entities and 10 vessels invovled in an Ecuador-based drugs shipping network linked to Los Choneros and Los Lobos, both of which are designated foreign terrorist organisations for their links to the CJNG and Sinaloa Cartel.
- Remaining in Latin America, the US listed 5 entities and 8 people on its Cuba sanctions regime for the procurement of military equipment from abroad for the US-designated Ministry of the Revolutionary Armed Forces and security forces. Later in the month, the US designated Cuba’s Ministry of Construction and one associated entity, as well as three officials of the US-designated Cuban Institute of Friendship with the Peoples (ICAP), four state-owned entities in Cuba’s mining and metals sector, and 3 entities owned or controlled by US-designated GECOMEX.
- The UK added Alexander Zhdanov, the owner of a Russian chemicals company, 12 entities operating in Russia’s financial services sector, and six vessels identified as being part of Russia’s shadow fleet to its Russian sanctions list. The EU later designated five individuals for supporting Russia’s military in Ukraine. The US separately added the International Criminal Court’s President Tomoko Akane and Abdoulaye Seye, a senior trial lawyer, to its ICC sanctions list.
Enforcement
- The US Financial Crimes Enforcement Network (FinCEN) fined UBS Financial Services Inc (UBSFS) $125 million for anti-money laundering and sanctions-related breaches of the Bank Secrecy Act, the largest penalty of its kind ever imposed on a broker-dealer. Between 2019 and 2023 UBSFS onboarded Russian people with ties to OFAC-designated individuals and failed to properly monitor more than 61,500 foreign currency wires worth over $10.5 billion.
- Separately, BAE Systems, Inc., the US subsidiary of BAE Systems plc, agreed to pay a $36 million civil penalty to settle 104 breaches of the Arms Export Control Act and the International Traffic in Arms Regulations between May 2019 and March 2025. Texas-based neuroscience technology company Plexon Inc meanwhile settled its liability for 8 breaches of the US Export Administration Regulations (EAR) between 2022 and 2023 with a 5-year suspended $1.7 million civil penalty. The BIS also reached a $1 million settlement with US aluminium can top producer Container Manufacturing Ltd for 10 breaches of the EAR between March 2023 and March 2025. Finally, US company Rice Lake Weighing Systems, which manufactures and distributes scales, agreed to pay $61,000 to settle its and its Italian subsidiary’s potential liability for breaching sanctions on Iran.
- Four US human rights groups opened a court case to challenge the legality of the US sanctions regime targeting the InternationalCriminal Court. This is the second case to challenge the regime as a whole, after a claim by two US advocacy groups in July 2026. Three sanctioned ICC judges are separately contesting their own designations, and two US claimants are running First Amendment challenges to the ban on providing services to listed persons: one under a preliminary injunction since July 2025, the other stayed on appeal in June 2026.
- Two individuals in the US pleaded guilty to breaching export controls, including US national Jean Casimir, who trafficked 140 firearms from the US to Haiti between 2020 and 2024 without obtaining licences, and Chinese national Dingwei Chen for attempting to buy US-made military-grade satellite modems and radios to ship the goods to China via Mexico. Two individuals received prison sentences in the US in August, including the former ship master of US-sanctioned shadow fleet vessel, and Italian national Manfred Gruber, who illegally exported ammunition worth over $540,000 from the US to Kyrgyzstan, where it was reexported to Russia. Outside the US, Austria’s interior ministry stated it had made arrests following an investigation into an unnamed company found to have supplied sanctioned goods to Russia’s EU-designated state arms manufacturer ROSTEC.
- The US Court of Appeals for the DC Circuit has held that all of British American Tobacco’s $629 million sanctions penalties for cigarette sales to North Korea should be paid into the US Victims of State Sponsored Terrorism Fundfund. Later in the month, British American Tobacco disclosed that OFAC is investigating it for potential breaches of US sanctions. In another matter, the same appeals court partially allowed drone maker SZ DJI’s appeal against its inclusion on the US list of Chinese military companies. The DC District Court separately granted a preliminary injunction preventing the US Department of Defense from enforcing the listing of Chinese drug research and development company WuXi AppTec Co as a Chinese military company.
- In the UK the National Crime Agency announced that agricultural company ENEX Premium Trading Limited, owned by Azeri national Nadir Valiyev and registered to St Kitts and Nevis, agreed to forfeit over £3.84 million following an investigation into suspected money laundering and sanctions evasion after funds were transferred into its accounts between July and September 2024.
Regulatory Updates and the Easing of Restrictions
- The UN extended its Central African Republic sanctions regime for one year until 31st Jul 2027. The US Senate passed a bill that would impose new sanctions, visa bans and tariffs on people and entities linked to Russia and Iran. The bill must now be voted on by the US Congress before it is signed into law by the President.
- The month saw significant action in the easing of certain restrictions, however. The US rescinded Syria’s designation as a state sponsor of terrorism and removed privately owned Iraqi airline Fly Baghdad Airlines from its counterterrorism list citing major changes to their operations. A further five people and three entities based in Colombia and Mexico were removed from the US counternarcotics sanctions list without explanation.
- The US Bureau of Industry and Security (BIS) eased export controls on drones and related parts, software and technology, and OFAC issued a Russia-related General License, authorising transactions related to imports of certain diamonds. Another extension was also granted to Russian energy company Gazprom Neft’s Serbian oil refinery, Naftna Industrija Srbije (NIS). In Venezuela, the US issued three General Licenses authorising transactions relating to Venezuela’s state owned oil company, PdVSA and the Venezuelan telecommunications sector.
- The UK meanwhile added the Kurdistan Export Pipeline to a list of exempt projects. The licence now covers 9 projects and permits non-designated individuals to continue business operations involving certain sanctioned Russian oil companies. The UK extended one general licence, which authorises the continuation of business with four Lukoil Bulgaria entities and another, which allows UK people and entities to continue transacting with Lukoil’s German subsidiary. They now expire in October 2026 and February 2027, respectively. The US also issued a General Licence to allow transactions related to the sale of Lukoil’s German subsidiary until mid-September 2026.
