Sanctions and Export Controls Update

Monthly Roundup – June 2026

📅 July 1, 2026

Welcome to this month’s Sanctions and Export Controls Update, highlighting IFI’s take on key developments from June 2026.

June delivered the biggest Iran development since the war began: after a month of escalating Economic Fury designations, the U.S. and Iran electronically signed the Islamabad Memorandum of Understanding on June 17, extending the ceasefire by 60 days, reopening the Strait of Hormuz, and committing the U.S. to begin terminating sanctions and unfreezing Iranian assets as Iran engages in nuclear talks. OFAC began implementing the deal within days, issuing Iran General License X to authorize the resale of Iranian crude oil, petrochemical, and petroleum products through the negotiation window.

The EU and UK both delivered significant Russia sanctions developments: the European Commission proposed its 21st sanctions package on June 9, targeting energy revenues, the shadow fleet, crypto-asset services, and fisheries for the first time, while the UK announced a new G7-aligned sanctions package on June 16 and separately conducted its first-ever boarding of a sanctioned shadow fleet vessel on the high seas. In enforcement, the month’s headline was OFSI’s £1 million penalty against Sabre Global Technologies—the UK’s largest Russia-related sanctions penalty since 2022 and its first-ever circumvention case—while DOJ’s National Security Division issued its first-ever declination under the new Corporate Enforcement Policy in a parallel resolution with Bosch.

Iran

June began with the Economic Fury campaign at full intensity and Secretary of State Marco Rubio testifying to Congress on June 2 that the U.S. was not discussing, and had not offered, sanctions relief in exchange for Iran reopening the Strait of Hormuz. By month’s end, that posture had shifted dramatically: negotiators reached, and both presidents electronically signed, a memorandum of understanding extending the ceasefire and beginning a structured wind-down of sanctions pressure in exchange for a 60-day window of nuclear negotiations.

The U.S. continued issuing near-weekly Economic Fury designations through mid-June. On June 2, OFAC designated multiple Iranian digital asset exchanges for providing “significant support” to the Iranian regime, including by serving as a vehicle for sanctions evasion. On June 5, OFAC sanctioned a network of individuals, entities, and vessels across multiple jurisdictions for shipping Iranian-origin liquefied petroleum gas (LPG) intentionally disguised as Omani product to end users in South and East Asia, and separately designated an Iranian exchange house for moving hundreds of millions of dollars on behalf of sanctioned Iranian banks. On June 10, OFAC sanctioned nine individuals and entities supporting weapons procurement on behalf of the IRGC and MODAFL, including multiple Hong Kong-based companies. The State Department concurrently sanctioned two entities and two individuals in Iran and Belarus in connection with Iran’s conventional arms-related activities.
Negotiations advanced rapidly in the back half of June. On June 12, the two sides agreed to new 60-day ceasefire conditions, and on June 17, Presidents Trump and Pezeshkian electronically signed the Islamabad Memorandum of Understanding, ending hostilities on all fronts (including in Lebanon) and triggering a 60-day negotiating window. Under the 14-point text of the MOU, Iran agreed to permit safe, toll-free passage of commercial vessels through the Strait of Hormuz for 60 days while it negotiates an arrangement with Oman over the Strait’s future administration. In exchange, the U.S. committed to begin removing its naval blockade of Iranian ports, to “terminate all types of sanctions” as part of a final deal, to make frozen Iranian assets fully available pursuant to agreed procedures, and to work with regional partners toward a $300 billion reconstruction and development plan for Iran. Iran reaffirmed it will not develop nuclear weapons, with a mechanism to be mutually agreed for addressing its enriched uranium stockpile during the negotiation period.
OFAC began implementing the sanctions relief contemplated by the MOU within days of signing. On June 22, OFAC published Iran General License X (GL X), broadly authorizing the purchase, resale, and delivery of Iranian-origin crude oil, petrochemical products, and petroleum products through August 21, 2026—the end of the 60-day negotiation window. GL X authorizes payment in U.S.-dollar-denominated funds and permits the use of vessels sanctioned under various U.S. sanctions authorities, but excludes any transaction involving persons in Crimea, Cuba, the so-called Donetsk or Luhansk “people’s republics,” or North Korea.

Russia

The EU and UK both advanced significant new Russia sanctions measures in June, even as both also moved to renew existing restrictive measures for another year. The European Commission proposed its 21st sanctions package, while the UK announced a new G7-aligned designation package and conducted a landmark at-sea interdiction of a sanctioned shadow fleet vessel.

On June 9, the European Commission proposed its 21st sanctions package against Russia, focused on the sectors EU High Representative Kallas described as having the “highest impact”—energy, financial services and crypto, and trade. The proposal, which has an unofficial target date of mid-July and still requires unanimous Council approval, would:

Pause adjustments to the Russian oil price cap mechanism until January 2027 to account for market volatility linked to the Strait of Hormuz closure;
List 30 additional shadow fleet vessels and, for the first time, target vessels that provide bunkering and other support services to the shadow fleet;
Impose transaction bans on two additional Russian ports and four airports;
Expand transaction bans to 31 additional Russian banks and impose asset freezes on close to 90 banks overall, plus designate 20 third-country banks, crypto platforms, and oil traders accused of facilitating circumvention;
Introduce, for the first time, the possibility of a full ban on crypto-asset services originating from certain third countries;
Add more than 30 new designations in the drone manufacturing sector and new export control measures on 50 companies in China, Türkiye, Kyrgyzstan, Kazakhstan, the UAE, and India;
Restrict exports of additional metals, alloys, and drone-related ground support, jamming, and launch equipment;
Impose new import bans on roughly €60 million of goods, including metals, metal ores, and automotive parts; and
Introduce, for the first time, sanctions on Russian fisheries, including a full ban on certain products such as cod.

On June 15, the EU Council adopted a smaller, separately negotiated “mini” sanctions package, designating 34 individuals and 47 entities, including two individuals and 24 entities tied to shipment and export of Russian crude oil or petroleum products (among them shadow fleet-linked companies in Russia, Liberia, Türkiye, the UAE, Azerbaijan, and Hong Kong), alongside drone and military equipment manufacturers. The Council also renewed the EU’s Crimea/Sevastopol annexation-related sanctions and the broader sectoral sanctions on Russia for another year. Separately, the Court of Justice of the EU dismissed an appeal by Russia’s National Settlement Depository against its EU listing, confirming that the listing was adequately reasoned and evidence-based.

On June 16, at the G7 summit, the UK Prime Minister announced a new Russia sanctions package designating 11 individuals, 32 entities, and 27 vessels, targeting dual-use goods procurement networks and entities connected to Russia’s defense, financial, transport, and energy sectors. The UK has now sanctioned more than 600 vessels in total, and the government signaled that those enabling tanker sales into the shadow fleet would face further action. Two days earlier, on June 14, in what UK officials confirmed was the first such action taken by the UK, Royal Marine Commandos and NCA officers boarded the sanctioned vessel SMYRTOS in the English Channel; the vessel had been designated for its role in Russia’s shadow fleet oil evasion network.

Other Significant Developments

June’s other significant developments were dominated by continued escalation of U.S. sanctions on Cuba, including designations of the country’s defense ministry, president, and state oil company CUPET, alongside further OFAC action against armed groups and the networks financing them in the Democratic Republic of the Congo and Sudan, a major coordinated strike against the Prince Group transnational scam network and its financial enablers, and a fresh OFAC-FinCEN action against CJNG’s cross-border fuel smuggling operations.

On export controls, Commerce took the unprecedented step of suspending Anthropic’s export of its most advanced AI models worldwide over diversion risk to foreign military intelligence services, and China retaliated against U.S. rare-earth export curbs by blacklisting ten American firms. Enforcement activity remained brisk on both sides of the Atlantic: OFSI fined Sabre Global Technologies a record sum for Russia sanctions circumvention, the NCA charged the captain of an interdicted shadow fleet tanker, and OFAC settled with FTI Consulting over indirect dealings in sanctioned Russian bank debt.

Cuba

State Department Escalates Cuba Sanctions Under EO 14404: Defense Ministry, President, and State Oil Company Designated

The administration continued its rapid escalation of Cuba-related sanctions under Executive Order 14404 (signed May 1) with two further designation rounds in June. On June 4, the State Department designated five individuals and five entities, including the Ministry of the Revolutionary Armed Forces of Cuba (MINFAR), Cuban state gold mining enterprises Minera la Victoria SA and Geominera SA, and—notably—Cuban President Miguel Díaz-Canel Bermudez himself. Then, on June 11, the State Department designated Cuba’s state-owned oil and gas company, Unión Cuba-Petróleo (CUPET), for operating in Cuba’s energy sector. CUPET controls a significant share of Cuba’s crude production (roughly 40,000 barrels per day, meeting about 40% of domestic demand), refining, and fuel distribution infrastructure. Together, the June designations mark the third and fourth rounds under EO 14404 following the May 7 and May 18 actions, and non-U.S. financial institutions and counterparties with any Cuba-linked exposure should treat the pace of designations as a signal that further secondary-sanctions-eligible targets are likely.

Terrorism

OFAC Expands Designations Targeting Hizballah-Aligned Lebanese Officials, Hamas, and Affiliated Networks

OFAC continued expanding its designations of individuals obstructing Lebanon’s peace process and Hizballah’s disarmament, building on its March 20 and May 21 designations of Hizballah-aligned Lebanese officials and the business network overseen by Alaa Hassan Hamieh, with additional interlocutors in Lebanon, Syria, Iraq, and Oman designated in June for raising funds, executing contracts, and operating front companies on Hizballah’s behalf. In parallel, OFAC and the State Department continued targeting Hamas-aligned networks, including operatives linked to the Popular Conference for Palestinians Abroad’s pro-Hamas flotilla and Muslim Brotherhood-affiliated entities. The continued tempo of these designations reflects the administration’s effort to maintain pressure on Hizballah’s and Hamas’s financial infrastructure even as broader U.S. diplomatic attention shifted toward implementing the Iran MOU.

Organized Crime / Transnational Scam Networks

Treasury Further Dismantles Prince Group TCO and Huione-Linked Scam Operations Targeting Americans

On June 23, Treasury took coordinated action against the Prince Group Transnational Criminal Organization (Prince Group TCO), with OFAC sanctioning nine individuals and 26 entities tied to the group, including TCO leadership, scam-compound investors, and front companies. The designations center on Hu Xiaowei, described as Prince Group TCO’s “second-in-command” and a close associate of leader Chen Zhi, along with the extensive network of British Virgin Islands, Hong Kong, Singapore, and UK-based companies he uses to manage scam-derived funds and properties, plus several of his Hong Kong-based subordinates.

In parallel, FinCEN proposed amending its October 2025 Huione Group Final Rule to add H-Pay Service PLC and any successor entity, addressing Huione’s role as a laundering node for cyber heist and virtual currency investment scam proceeds on Prince Group’s behalf. The FBI’s New York Field Office simultaneously seized Huione-linked infrastructure, with assistance from Australia’s AUSTRAC, and OFAC’s action was coordinated with Japan’s National Police Agency. The action builds on OFAC’s October 2025 designation of Prince Group as a TCO and its April 23 designation of Cambodian senator Kok An, and follows a U.S. government estimate that Americans lost at least $10 billion in 2024 to Southeast Asia-based scam operations—a 66% year-over-year increase—underscoring the continued priority the administration is placing on dismantling these networks under Executive Order 14390.

Organized Crime / Drug Cartels

Treasury Targets Criminal Facilitators Behind CJNG’s Cross-Border Fuel Smuggling Schemes

On June 30, Treasury announced coordinated action against fuel smuggling schemes linked to Cartel de Jalisco Nueva Generación (CJNG), a U.S.-designated Foreign Terrorist Organization and Specially Designated Global Terrorist. OFAC sanctioned two Mexican nationals and nine entities tied to a practice known in Mexico as huachicol fiscal, in which cartels and their facilitators smuggle gasoline, diesel, and other fuel from the United States into Mexico to evade Mexico’s IEPS fuel import tax, generating tens of millions of dollars annually for CJNG. The most significant designee, Oscar Guillermo Juraidini Silva, is an accountant described by Treasury as the “mastermind” behind certain CJNG financial operations, who creates shell companies and falsifies customs documentation to mislabel U.S. fuel imports and evade Mexican taxes; OFAC also designated six of his Mexican companies (spanning transportation, financial services, and real estate) and a UK-based company.

In parallel, FinCEN issued a supplemental alert providing financial red flags for fiscal fuel theft schemes, building on its May 2025 alert on related crude oil smuggling, under which FinCEN says it has received over 160 Suspicious Activity Reports detailing more than $7 billion in suspicious activity in the following 12 months, concentrated in Texas and Florida. The action was coordinated with a South Texas Homeland Security Task Force investigation involving DEA, HSI, FBI, IRS-CI, BIS, and CBP, as well as Mexico’s financial intelligence unit (UIF), and builds on prior OFAC huachicol-related designations in September 2024 and May 2025.

Conflict Minerals and Armed Groups in Africa

OFAC Sanctions DRC/Rwanda Rebel Commanders and Conflict-Minerals Network; Sudan Procurement and Recruitment Networks

OFAC continued pressing armed groups and the networks that finance them across two African conflicts. In the Democratic Republic of the Congo, OFAC sanctioned two rebel commanders on June 2—Gustave Kubwayo of the Democratic Forces for the Liberation of Rwanda (FDLR) and John Imani Nzenze, an M23 intelligence chief—and, on June 25, designated Gasabo Gold Refinery LTD, a Kigali-based refinery, along with its chairman, general manager, and three affiliated Rwandan mining companies, for laundering gold mined in M23/Rwanda Defence Force-occupied territory in South Kivu (more than 60 kg in early 2026 alone) for export through Rwanda; the EU had previously designated the same refinery. These actions build on OFAC’s March and April 2026 designations of the RDF and former DRC President Joseph Kabila, underscoring continued U.S. pressure on the regional conflict-minerals trade notwithstanding the December 2025 Washington Accords.

In Sudan, OFAC sanctioned eight individuals and entities on June 26 linked to procurement and recruitment networks sustaining the civil war between the Sudanese Armed Forces (SAF) and the Rapid Support Forces (RSF): on the SAF side, Target Multiactivities Company Ltd. and its managing director for importing explosives from Egyptian and Indian suppliers and Ports Engineering Company Ltd. for importing intelligence-personnel uniforms and ammunition; on the RSF side, three Panamanian and Colombian nationals tied to Talent Bridge, S.A., the vehicle used to obscure a Colombian mercenary recruitment network sanctioned in December 2025 and April 2026. The action accompanied a renewed U.S. call for an immediate three-month humanitarian truce.

Export Controls

DOJ Issues First-Ever Declination Under New Corporate Enforcement Policy in Parallel BIS Settlement with Bosch

On June 17, the DOJ’s National Security Division declined to prosecute Robert Bosch GmbH for potential criminal violations of the Export Control Reform Act—the first declination issued under the department-wide Corporate Enforcement Policy that NSD confirmed applies to export control and sanctions matters in March 2026. The underlying conduct involved two Bosch subsidiaries exporting products manufactured using equipment that was the “direct product” of U.S. technology to Huawei and its Entity List affiliates, in potential violation of the EAR’s Foreign Direct Product Rule. BIS simultaneously announced a parallel $36,184,680 civil settlement, crediting Bosch’s voluntary self-disclosure and remediation.

Commerce Suspends, Then Partially Restores, Anthropic’s Export of Frontier AI Models Over Foreign Military Intelligence Diversion Risk

On June 15, Commerce Secretary Lutnick ordered Anthropic to suspend export of its newly released Mythos 5 and Fable 5 AI models worldwide and to all foreign nationals—including Anthropic’s own non-U.S. employees—citing risk that the models could be diverted to military intelligence services in China, Russia, or other countries of concern, invoking the 2018 Export Control Reform Act’s emerging technology authority in what specialists describe as its first use in this manner. Anthropic disputed the government’s characterization of a model “jailbreak” as overstated but disabled global access to comply.

By month’s end, the dispute had partially de-escalated: on June 26, Lutnick notified Anthropic that Mythos 5 could be released to roughly 100 pre-approved U.S. companies and government agencies, including those entities’ foreign national employees and Anthropic’s own foreign national staff, after the company “committed to work with the U.S. government on protocols and standards” for future model releases. The June 26 letter remained silent on Fable 5, leaving its export status unresolved, and Lutnick reserved the right to readjust the scope of the licensing requirement should circumstances change. No public BIS or Commerce Department press release, rule, or fact sheet has been issued describing either the June 12 restriction or the June 26 partial easing.

China Retaliates with Rare Earth Export Curbs on 10 U.S. Firms

On June 22, China’s Commerce Ministry added 10 U.S. entities to its export control list, most notably rare earth producers MP Materials Corp. and USA Rare Earth Inc., in response to the Pentagon’s early-June addition of roughly 80 Chinese companies (including Alibaba, Baidu, and BYD) to its list of “Chinese Military Companies Operating in the United States.” Analysts assessed the rare earth curbs as having limited near-term operational impact given both firms’ reduced reliance on Chinese equipment, but as confirmation that Beijing continues to treat rare earth and critical mineral controls as a calibrated, repeatable retaliatory tool.

OFAC Tightens Licensing for Medical Device Exports to North Korea

On June 11, OFAC published a list of medical devices now requiring specific authorization for export to North Korea—including oxygen generators, diagnostic imaging equipment, and dual-use laboratory equipment such as fluorescence-activated cell sorters—tightening licensing for items with potential proliferation sensitivity under the existing general license for agricultural commodities, medicine, and medical devices.

Enforcement Actions

OFSI Fines Sabre Global Technologies £1 Million in Record Russia Sanctions Penalty

On June 17, OFSI imposed a £1,000,920.59 penalty on Sabre Global Technologies Limited—the UK’s largest Russia-related sanctions fine since 2022 and its first circumvention case—for continuing to provide Russian carrier Ural Airlines access to its Global Distribution System for seven months after designation, then attempting to reroute payments through a U.S. bank account.

NCA Charges Captain of Interdicted Shadow Fleet Tanker

Following the June 14 boarding of the sanctioned shadow fleet tanker SMYRTOS, the Crown Prosecution Service charged the vessel’s captain, Indian national Ajay Pant, with supplying prohibited Russian oil by ship to a third country—the first criminal prosecution to follow a UK at-sea shadow fleet interdiction, signaling that vessel crew, not just owners or charterers, may face direct UK criminal exposure.

Brussels Court Convicts Three in Russia Sanctions Evasion Scheme

On June 11, a Brussels court convicted three men of operating a criminal organization to export restricted dual-use goods—including explosion-detection sensors and yttrium oxide—to Russia’s defense sector via Turkey, Kazakhstan, and Uzbekistan, sentencing the lead defendant to five years and an €80,000 fine, with a second defendant tried in absentia receiving six years and an arrest order.

DOJ Sentences Defendants in Two Separate Russia Export Control Smuggling Cases

DOJ secured sentences in two unrelated Russia-related export control prosecutions in June. On June 24, a federal court in Brooklyn sentenced Natalya Mazulina, former western regional manager of freight forwarder Delex Air Cargo LLC, to 18 months in prison and ordered forfeiture of $77,000, after she pleaded guilty to conspiring to ship industrial oil and gas equipment to Russia through intermediary countries using falsified export documents. Separately, on June 12, a federal court in Kansas sentenced Douglas Robertson, former vice president of KanRus Trading Company Inc., to 32 months for exporting controlled avionics equipment to Russian end users (including Russia’s FSB) without the required licenses; his Latvia-based broker, Oleg Chistyakov, received 28 months in a related sentencing the same month.

OFAC Settles with FTI Consulting for $1.05 Million Over Indirect Dealings in VTB Bank Debt

On June 1, OFAC announced a $1,050,000 settlement with FTI Consulting, Inc. for six apparent violations of Directive 1 under E.O. 13662 arising from indirect dealings in the debt of Russia’s state-owned VTB Bank. Between April 2019 and May 2021, FTI provided expert economic consulting services in support of VTB in Singapore litigation, structuring its engagement through a global law firm so that FTI would invoice the law firm, which would in turn collect from and remit payment on behalf of VTB. When VTB’s payments were delayed—in one instance by 198 days—OFAC found that FTI’s continued performance against unpaid invoices effectively extended new debt to VTB beyond the 14-day maturity threshold permitted under the sectoral sanctions, regardless of the intermediary structure. OFAC doubled the base penalty of $525,000 to promote deterrence while crediting FTI’s cooperation and compliance enhancements.

Regulatory Developments and Cross-Border Cooperation

EU Adopts Revised Foreign Investment Screening Framework

On June 8, the Council of the EU formally adopted a revised Foreign Direct Investment (FDI) Screening Regulation, replacing the 2019 framework following the European Parliament’s May 19 approval. While all 27 member states already operate some national FDI screening mechanism, the new regulation imposes binding minimum standards for the first time: mandatory screening in every member state, a common minimum sectoral scope covering dual-use items and other sensitive sectors, expanded coverage of investments routed through EU-based subsidiaries of non-EU investors, and a strengthened EU-level cooperation mechanism—though final investment decisions remain with national authorities. The regulation enters into force 20 days after Official Journal publication, with member states given 18 months to transpose the new requirements.

OFAC and OFSI Publish Joint Guidance Comparing Sanctions Regimes

On June 23, OFSI published an update on the OFAC-OFSI Enhanced Partnership Exchange, alongside a new joint overview comparing the two countries’ sanctions regimes. The report compares the organizations’ responsibilities, legal and enforcement frameworks, terminology, sanctions types, lists, jurisdictions, licensing processes, and reporting and recordkeeping requirements.

This report is prepared by the Institute for Financial Integrity (IFI) for informational purposes only and does not constitute legal advice. Links to underlying sources are provided for reference. For questions or to subscribe to future reports, please contact IFI.

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