Every Monday we post the highlights out of last week’s FCC Export/Import Daily Update (“The Daily Bugle”). Send out every business day to approximately 8,500 readers of changes to defense and high-tech trade laws and regulations, The Daily Bugle is a free daily newsletter from Full Circle Compliance, edited by James E. Bartlett III, Salvatore Di Misa, and Elina Tsapouri.
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Last week’s highlights of The Daily Bugle included in this edition are:
1. Treasury/OFAC: “Settlement with Deutsche Bank Trust Company Americas”; Thursday, 10 Sep 2020; Item #5
2. Commerce/BIS: “Wassenaar Arrangement 2018 Plenary Decisions Implementation-Revisions Related to National Security Controls-“; Friday, 11 Sep 2020; Item #2
3. Treasury/OFAC: “Treasury Sanctions Russia-Linked Election Interference Actors”; Friday, 1 Sep 2020; Item #6
4. EU Council: “EU Extends Sanctions Against Violations of Territorial Integrity for a Further 6 Months”; Friday, 11 Sep 2020; Item #7
Treasury/OFAC: “Settlement with Deutsche Bank Trust Company Americas”
(Source: Treasury/OFAC, 9 Sep 2020)
The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) today announced two settlements totaling $583,100 with Deutsche Bank Trust Company Americas (DBTCA). The settlements resolve OFAC’s investigations into apparent violations of the Ukraine-Related Sanctions Regulations.
Specifically, DBTCA agreed to pay $157,500 for processing a large payment, related to a series of purchases of fuel oil, through the United States that involved a property interest of a designated oil company in Cyprus. At the time it processed the payment, DBTCA had reason to know of the designated oil company’s potential interest, but did not conduct sufficient due diligence to determine whether the designated oil company’s interest in the payment had been extinguished.
Separately, DBTCA agreed to remit $425,600 for processing payments destined for accounts at a designated financial institution. DBTCA failed to stop the 61 payments because it had not included in its sanctions screening tool the designated financial institution’s Society for Worldwide Interbank Financial Telecommunication (SWIFT) Business Identifier Code (BIC), and DBTCA’s screening tool was calibrated so that only an exact match to a designated entity would trigger further manual review. OFAC determined that neither case was voluntarily self-disclosed to OFAC, and that the apparent violations constitute non-egregious cases.
Commerce/BIS: “Wassenaar Arrangement 2018 Plenary Decisions Implementation-Revisions Related to National Security Controls-“
(Source: Federal Register) [Excerpts]
85 FR 56294: Rule
* AGENCY: Bureau of Industry and Security, Commerce.
* ACTION: Final rule.
* SUMMARY: The Bureau of Industry and Security (BIS) maintains, as part of its Export Administration Regulations (EAR), the Commerce Control List (CCL), which identifies certain items subject to Department of Commerce jurisdiction. This final rule revises the CCL and other corresponding parts of the EAR, to implement changes made to the Wassenaar Arrangement List of Dual-Use Goods and Technologies and Munitions List (WA Lists) maintained by the governments participating in the Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies (Wassenaar Arrangement, or WA) at the December 2018 WA Plenary meeting. The Wassenaar Arrangement advocates implementation of effective export controls on strategic items with the objective of improving regional and international security and stability. BIS published a final rule on May 23, 2019, implementing certain new controls on emerging technologies, as decided at the 2018 Plenary meeting. This rule harmonizes the CCL with the remaining decisions reached at the 2018 Plenary meeting by revising Export Control Classification Numbers (ECCNs) controlled for national security reasons in each category of the CCL, except Category 4. This rule also makes other associated changes to the EAR, as well as adjustments to license exception eligibility for national security-controlled items and revisions to reporting requirements.
Treasury/OFAC: “Treasury Sanctions Russia-Linked Election Interference Actors”
(Source: Treasury/OFAC, 10 Sep 2020)
Today, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated four Russia-linked individuals for attempting to influence the U.S. electoral process. Russia uses a variety of proxies to attempt to sow discord between political parties and drive internal divisions to influence voters as part of Moscow’s broader efforts to undermine democratic countries and institutions. In the United States, Russia has used a wide range of influence methods and actors to target our electoral process, including targeting U.S. presidential candidates.
Treasury designated Andrii Derkach (Derkach) pursuant to Executive Order (E.O.) 13848 for his efforts to influence the 2020 U.S. presidential election. Derkach, a Member of the Ukrainian Parliament, has been an active Russian agent for over a decade, maintaining close connections with the Russian Intelligence Services. Derkach has directly or indirectly engaged in, sponsored, concealed, or otherwise been complicit in foreign interference in an attempt to undermine the upcoming 2020 U.S. presidential election. Today’s designation of Derkach is focused on exposing Russian malign influence campaigns and protecting our upcoming elections from foreign interference. This action is a clear signal to Moscow and its proxies that this activity will not be tolerated. The Administration is working across the U.S. Government, and with state, local, and private sector partners, to make the 2020 election secure.
“Andrii Derkach and other Russian agents employ manipulation and deceit to attempt to influence elections in the United States and elsewhere around the world,” said Secretary Steven T. Mnuchin. “The United States will continue to use all the tools at its disposal to counter these Russian disinformation campaigns and uphold the integrity of our election system.”
Derkach’s Election Influence Efforts
From at least late 2019 through mid-2020, Derkach waged a covert influence campaign centered on cultivating false and unsubstantiated narratives concerning U.S. officials in the upcoming 2020 Presidential Election, spurring corruption investigations in both Ukraine and the United States designed to culminate prior to election day. Derkach’s unsubstantiated narratives were pushed in Western media through coverage of press conferences and other news events, including interviews and statements.
Between May and July 2020, Derkach released edited audio tapes and other unsupported information with the intent to discredit U.S. officials, and he levied unsubstantiated allegations against U.S. and international political figures. Derkach almost certainly targeted the U.S. voting populace, prominent U.S. persons, and members of the U.S. government, based on his reliance on U.S. platforms, English-language documents and videos, and pro-Russian lobbyists in the United States used to propagate his claims.
Treasury Continues to Hold Russian Actors Accountable
Today’s designation of Derkach is another example of the Treasury department promoting accountability for Kremlin-linked individuals seeking to undermine confidence in U.S. democratic processes. Treasury has previously designated the Russian troll factory known as the Internet Research Agency (IRA), and its Russian financier Yevgeniy Prigozhin. Prigozhin has been designated by the United States pursuant to E.O. 13661, E.O. 13694, as amended, and most recently by E.O. 13848 for providing material support to the IRA’s influence activities against the 2018 U.S. midterm elections.
Today, Treasury also designated three IRA actors pursuant to E.O. 13694, as amended by E.O. 13757, and E.O. 13848 for having acted or purported to act for or on behalf of, directly or indirectly, the IRA, an entity designated pursuant to E.O. 13694, as amended, and E.O. 13848. Russian nationals Artem Lifshits, Anton Andreyev, and Darya Aslanova, as employees of the IRA, supported the IRA’s cryptocurrency accounts. The IRA uses cryptocurrency to fund activities in furtherance of their ongoing malign influence operations around the world.
OFAC coordinated today’s action against the IRA with the U.S. Attorney’s Office for the Eastern District of Virginia and the United States Secret Service.
As a result of today’s designations, all property and interests in property of these targets that are subject to U.S. jurisdiction are blocked, and U.S. persons are generally prohibited from engaging in transactions with them. Additionally, any entities 50 percent or more owned by one or more designated persons are also blocked.
View identifying information on the individuals designated today.
EU Council: “EU Extends Sanctions Against Violations of Territorial Integrity for a Further 6 Months”
(Source: Council of the European Union, 10 Sep 2020)
Today the Council decided to extend the sanctions targeting persons and entities that continue to undermine or threaten the territorial integrity, sovereignty and independence of Ukraine, for a further 6 months until 15 March 2021.
The existing restrictive measures provide for both travel restrictions and the freezing of assets, and will continue to apply to 175 persons and 44 entities.
The decision was adopted by the Council by written procedure. The legal acts will be published in the Official Journal on 11 September 2020.
Restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine were first introduced on 17 March 2014.
Other EU measures in place in response to the crisis in Ukraine include economic sanctions targeting specific sectors of the Russian economy, currently in place until 31 January 2021, and restrictive measures in response to the illegal annexation of Crimea and Sevastopol, limited to the territory of Crimea and Sevastopol and currently in place until 23 June 2021.
The list of sanctioned persons and entities are kept under constant review and subject to periodic renewals by the Council.
• EU restrictive measures in response to the crisis in Ukraine (policy page)
• Factsheet EU-Ukraine relations (EEAS)
• Council Decision 2014/145/CFSP, 17 March 2014