Sanctions and Export Controls Update

United States

Sanctions and Money Laundering

The U.S. Department of the Treasury sanctioned over 30 individuals and entities tied to Iran’s shadow banking network, including the Zarringhalam brothers, for laundering billions through front companies in the UAE and Hong Kong to evade sanctions and fund Iran’s military and terrorist activities. The brothers facilitated payments from Iranian oil and petrochemical sales on behalf of sanctioned entities, including the IRGC-QF and MODAFL, using fictitious invoices and shell companies. Treasury also issued updated guidance to help financial institutions detect Iranian illicit  oil smuggling, shadow banking, and weapons procurement activities. This marks the first major action targeting Iran’s shadow banking infrastructure under the administration’s maximum pressure campaign. 

• June 6: Treasury Sanctions Iranian Network Laundering Billions for Regime Through Shadow Banking Scheme 

Iurii Gugnin, a Russian national residing in New York, has been indicted on 22 counts for allegedly laundering over $500 million through U.S. financial institutions and cryptocurrency exchanges via his companies, Evita Investments and Evita Pay. Prosecutors allege he used these entities to funnel funds from sanctioned Russian banks, disguising the origins and purposes of the transactions while facilitating the purchase of sensitive U.S. technology for Russian clients. Gugnin is accused of deceiving banks and crypto platforms, operating an unlicensed money transmitting business, and failing to implement required anti-money laundering programs. Authorities say he also falsified records and made materially false statements to obtain licenses, using digital tactics to conceal the identities of Russian customers. If convicted, he faces up to 30 years in prison for each bank fraud charge and significant additional penalties for related offenses. 

• June 9: Founder of Cryptocurrency Payment Company Charged with Evading Sanctions and Export Controls, Defrauding Financial Institutions, and Violating the Bank Secrecy Act 

The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) has identified three Mexico-based financial institutions, CIBanco, Intercam, and Vector, as primary money laundering concerns for their role in facilitating opioid trafficking, particularly fentanyl, on behalf of major drug cartels. These are the first actions under new fentanyl-related sanctions and AML laws and include prohibitions on certain fund transfers involving these institutions. FinCEN’s findings detail how these financial institutions helped move millions of dollars on behalf of Mexico-based cartels and facilitate precursor chemical purchases from China. The actions align with broader efforts, including recent cartel designations as terrorist organizations, to combat the opioid crisis and disrupt cartel financing networks. 

• June 25: Treasury Issues Historic Orders under Powerful New Authority to Counter Fentanyl 

Juan Carlos Cairo-Padron of Texas and Thomas Michael Fortinberry of Alabama were arrested on June 13, 2025, for allegedly violating U.S. sanctions on Venezuela, smuggling goods, and laundering money. The two men are accused of conspiring to sell millions of dollars’ worth of chemical catalysts and industrial equipment to sanctioned Venezuelan state-owned companies, using front companies and complex financial transactions to hide the true destination of the goods. They allegedly operated through companies they controlled and used suppliers in China to ship goods directly to Venezuela, while moving funds through bank accounts in the U.S., Spain, and China. If convicted, they each face up to 20 years in prison for sanctions and money laundering violations, and up to 10 years for smuggling. 

• June 16: Venezuelan National and U.S. Citizen Arrested for Sanctions Evasion and Smuggling in Scheme to Supply Venezuela’s State-Owned Steel Industry 

Other Sanctions Issues 

The U.S. Department of the Treasury sanctioned five individuals and five foreign sham charities for secretly funding Hamas’s military wing under the guise of humanitarian aid, with one additional charity linked to the Popular Front for the Liberation of Palestine (PFLP). These entities operated globally from Gaza, Türkiye, and Algeria to the Netherlands and Italy, raising millions of dollars for terrorism while misleading donors. The designations highlight how Hamas and the PFLP exploit nonprofit organizations to finance violence and evade sanctions. Treasury’s action, under Executive Order 13224, aims to protect the charitable sector and prevent further abuse by terrorist groups. 

• June 10: Treasury Disrupts Sham Overseas Charity Networks Funding Hamas and the PFLP 

On June 16, OFAC announced a $3.88 million settlement with Unicat Catalyst Technologies, LLC, a company based in Alvin, Texas. The settlement resolves Unicat’s potential civil liability for 13 apparent violations of the Iranian Transactions and Sanctions Regulations (ITSR) and one violation of the Venezuela Sanctions Regulations (VSR). These violations involved the provision of catalyst products and consulting services to Iran, as well as the sale of catalyst products to a sanctioned Venezuelan entity. Although Unicat voluntarily self-disclosed the violations, OFAC determined the case to be egregious, which influenced the settlement amount. 

• June 16: Settlement Agreement between the U.S. Department of the Treasury’s Office of Foreign Assets Control and Unicat Catalyst Technologies, LLC 

The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has sanctioned one individual, eight entities, and one vessel, the SHUN KAI XING, for facilitating the shipment of sensitive machinery to Iran’s defense industry. The sanctioned parties were involved in covertly transporting dual-use goods for Iran-based companies linked to the Islamic Revolutionary Guard Corps (IRGC), including Rayan Roshd Afzar Company (RRA) and its affiliates. The shipments involved falsified documents and coordination among companies in China, Hong Kong, Singapore, Türkiye, and Iran. These actions, taken under Executive Order 13382, aim to disrupt Iran’s missile and weapons development efforts. All U.S.-linked assets of the sanctioned parties are now blocked, and engaging with them could lead to further penalties, including secondary sanctions for foreign financial institutions. 

• June 20: Treasury Targets Entities Procuring Sensitive Machinery for Iran’s Defense Industry 

Export Controls 

The U.S. Justice Department decided not to prosecute private equity firm White Deer Management LLC after the firm voluntarily disclosed U.S. sanctions and export control violations by Texas-based Unicat Catalyst Technologies, which it had acquired. Unicat’s former CEO, Mani Erfan, pleaded guilty to conspiring to violate U.S. sanctions and was fined $1.6 million. White Deer’s timely self-disclosure, cooperation in the investigation, and remedial actions led to a non-prosecution agreement for Unicat, which also paid a total of $8.3 million in penalties. This marks the first time the Justice Department applied its Mergers and Acquisitions Policy to decline prosecution of an acquirer who self-disclosed criminal conduct at an acquired company. 

• June 16: Justice Department Declines Prosecution of Private Equity Firm Following Voluntary Disclosure of Sanctions Violations and Related Offenses Committed by Acquired Company 

Bence Horvath, 47, a Spanish national residing in the UAE, pleaded guilty in U.S. District Court to conspiring to illegally export U.S.-origin military-grade radio communications technology to Russian end users without the required license. Starting in January 2023, Horvath worked with others to procure the equipment from a U.S. distributor and planned to route the shipment through Latvia to Russia. He purchased 200 radios as part of the scheme, but U.S. Customs intercepted the shipment before it could reach its destination. Sentencing is set for September 30, and the case was investigated by multiple federal agencies, including Homeland Security Investigations and the Department of Commerce. 

• June 17: Spanish National Pleads Guilty to Conspiring to Export U.S. Military-Grade Radios to Russian Government End Users