The latest edition of LexisNexis Risk Solutions’ Taking the Pulse of Major Sanctions Lists suggests a heightened level of sanctions activity may be the new normal. The report analyzes activity from the United Nations (UN), European Union (EU), Office of Foreign Assets Control (OFAC), and the Office of Financial Sanctions Implementation (OFSI – UK) to identify trends and changes in policy. In the first half of 2024, 146 updates were made to lists, 10% more than the 133 from 2023’s first six months. The 2,340 net designations added were 14% more than in the same period last year.
The flavor of sanctions activity varies with the regulator. OFAC, EU and UK sanctions focus on Russia, Iran and terrorism. The EU and OFSI also prioritized human rights programs. OFAC is the busiest agency, enacting two-thirds of all net designations and 47% of updates.
OFAC’s activity is related to 18 sanctions programs, with a strong focus on Russia. One in three list updates involved changes related to Russian sanctions, while 77.4% of net additions to the four lists were related to Russia.
Enforcement agencies are targeting entities enriching Russia. OFAC sanctioned more than 25 third-country sanctions evaders operating from Europe, Central and East Asia and the Middle East. EU trade sanctions include 20 in Hong Kong, 10 in China, and Türkiye; and two in India, Kazakhstan and the Kyrgyz Republic.
Countries supporting Russia are popular targets. Iran was cited for supporting Russia through the procurement of UAVs. North Korea was also punished.
“On top of implementing extended sanctioning authorities on foreign financial institutions EO14114 in Dec. 2023, OFAC consistently targeted sanctions evasion networks and parties engaging in transactions with the Russian defence sector throughout H1 2024,” the report states.
In the Middle East, sanctions frequently target Hamas and its proxies. Israeli West Bank settlers have been targeted by the EU and OFSI under their global human rights sanctions programs. OFAC recently initiated a new sanctions program focused on the West Bank. It attracted 14 targets as of June 30. Syrian businesspeople were sanctioned for helping the Assad regime.
Iranian targets were predominantly involved with the production of UAVs and their transfer to Russia. The UK targeted hostile actions by the Government of Iran, including efforts to undermine Israel’s security.
The UN was quiet early this year. Its nine updates addressed Africa, particularly the Democratic Republic of the Congo (DRC) and Somalia. Most of its output involved updated information for 114 existing sanctions targets. In the DRC, six senior leaders of armed groups were penalized for “impeding the disarmament, demobilization and reintegration processes and involved in severe violations of human rights and international humanitarian law.” Somalia’s Al-Shabab had three leaders added for their terrorism involvement.
Actions taken against Sudan attempted to address escalating violence in Darfur, human rights violations and obstructing humanitarian assistance delivery.
Human rights violations were a popular theme, highlighted by Russian attempts to stifle civil dissent and the actions of extremist West Bank settlers. Terrorism was another, with Hamas and Palestinian Jihad frequent targets. Hezbollah and Hamas-related networks were new targets.
Narcotics traffickers generated eight list updates and 38 net designations. A main focus was the operatives of a Black-Market Peso Exchange that laundered illicit fentanyl proceeds for the Sinaloa Cartel.
“The numbers are clear: activity by the EU, OFAC and OFSI continues to be intense,” the report concludes. “The pace of updates and a number of designations exceeded those recorded for the same period last year. The earlier ‘storm’ of activity has settled into a new level of normal that is expected to continue through the end of 2024. The renewed political leadership (in the EU and UK) and the U.S. presidential election will no doubt impact
sanctions going forward.”