OFSI fines Citibank’s London branch £4.7m. FinCEN lands a record $125m on UBS. OFAC blocks Banco Exterior de Cuba.

On 3 September OFAC added Fidel Ernesto Castro Calis, grandson of Raúl Castro and son of Alejandro Castro Espín (himself designated in June 2026), to the SDN List. The same action designated five Cuban state-linked entities: Banco Exterior de Cuba, the state bank specialising in foreign-trade finance and international transactions; Comercial Cupet S.A., the commercial arm of Cuba’s oil sector; and Nicarotec, Cexni and Abapet, tied to nickel and mining. Banco Exterior de Cuba is the principal channel through which Cuba pays for imported food, fuel and medicine. All assets under US jurisdiction are blocked, and the standard OFAC secondary-sanctions exposure applies to foreign banks that knowingly facilitate significant transactions on behalf of the designated parties. The move continues the tightening of the Cuba sanctions posture over 2026.

Sources: OFAC Recent Actions, 3 September 2026 (20260903); US State Department press release ‘Further Sanctions on Cuba’s Elites, Financial Channels, and Resource Exploitation Apparatus’, 3 September 2026; Reuters and UPI coverage, 3 September 2026

On 28 August OFAC issued Iran-related and Counter Terrorism Designations under the Operation Economic Outcast umbrella launched by Treasury Secretary Scott Bessent on 24 August. The 28 August action focuses on Iran’s access to UAE banks and confirms UAE-domiciled correspondent lines as the next front of the secondary-sanctions campaign. Alongside the designations, Treasury suspended selected general licences. Treasury has framed the campaign as an unprecedented effort to sever Iran’s remaining economic ties across digital assets, gold, aviation, technology and shipping, with the UAE identified as the single largest jurisdiction for Iran-related US designations.

Sources: OFAC Recent Actions, 28 August 2026 (20260828); Steptoe Weekly Sanctions Update, 31 August 2026; Paul Hastings client alert on Operation Economic Outcast

On 27 August OFAC issued amended Venezuela-related General Licences 50C, 46D, 47B, 48C, 52B and 61A (among eight amendments) covering oil and gas sector operations, Venezuelan-origin oil and petrochemical products, US-origin diluents, PDVSA-related transactions and telecommunications. The amendments remove the requirement that the terms of authorised contracts be construed and interpreted in accordance with the laws of a US state or other US jurisdiction. That is a technical change with practical reach: counterparties operating under these general licences now have flexibility on the governing law of the underlying commercial contracts.

Sources: OFAC Recent Actions, 27 August 2026; Steptoe Weekly Sanctions Update, 31 August 2026; Venezuela sanctions programme page, OFAC

OFSI imposed a penalty of £4,732,830.58 on Citibank, N.A. London Branch (CBNA London) under section 146 of the Policing and Crime Act 2017 for breaches of the Russia (Sanctions) (EU Exit) Regulations 2019 and the Global Anti-Corruption Sanctions Regulations 2021. In total the bank processed 970 payments with a cumulative value of £19,720,127.43, the majority between February and November 2022. The breaches spanned eight matters across payment processing, correspondent banking and account restrictions. Root causes were specific and instructive: a screening system that did not match the Russian corporate prefix in ‘PAO Sovcomflot’ against the listed name ‘Sovcomflot’, leaving 32 accounts held by 29 SCF-owned entities unrestricted through 328 payments; an internal correspondent-bank list that was never screened against sanctions lists, so designated Russian banks were added to payment chains after screening; BICs for designated banks missing from internal list entries; and a third-level alert queue backlog that left alerts unadjudicated for weeks. OFSI rated the case Level 4, its highest seriousness band, with severity High and conduct Aggravating. The statutory maximum was £9,860,063.72 and the baseline £7,888,050.97, reduced 40% by a 20% voluntary-disclosure and co-operation discount and a 20% settlement discount. Aggravating separately: CBNA London failed to report frozen assets promptly on 53 occasions, averaging 274 days, with 11 reports at 518 days.

Sources: OFSI Public Penalty Notice, ‘Imposition of Monetary Penalty - Citibank, N.A., London Branch’; OFSI Financial Sanctions Enforcement and Monetary Penalties Guidance, 9 February 2026 version; AML Intelligence and Lexology Pro coverage, September 2026

FinCEN assessed a $125,000,000 civil money penalty against UBS Financial Services Inc. (UBSFS) for wilful violations of the Bank Secrecy Act, the largest penalty ever imposed on a broker-dealer for BSA violations. It is FinCEN’s second action against the firm: a December 2018 consent order carried a $14.5 million penalty for failures to monitor foreign currency wires. Despite assuring FinCEN it would remediate, UBSFS subsequently failed to monitor over 50,000 foreign currency wires with an aggregate value above $10 billion, and did not disclose the failure, which FinCEN discovered through its own investigation following a regulatory examination. UBSFS also failed on customer due diligence for high-risk customers with ties to Russia and Latin America, including instances where it did not adequately consider source of wealth or negative news alleging corruption, fraud and money laundering, even where a UBS affiliate had itself raised concerns. Hundreds of suspicious transactions went unreported on time. UBSFS admits the wilful violations. The consent order requires a third-party lookback and an independent AML review focused on four priority risks: the US Southwest border, cartels and narcotics trafficking; Iran; Russia; and Venezuela. FinCEN will waive up to $15 million of the expenses on satisfactory completion.

Sources: FinCEN news release, 3 August 2026: ‘FinCEN Assesses Historic $125 Million Penalty Against UBS Financial Services Inc. for Recidivist BSA Violations’; FinCEN-UBSFS Consent Order; FinCEN December 2018 UBSFS Consent Order

FINTRAC announced administrative monetary penalties against two Maritime gaming Crown corporations. The New Brunswick Lotteries and Gaming Corporation, headquartered in Fredericton, was penalised C$399,712.50 on 24 July 2026 for failing to submit suspicious transaction reports where there were reasonable grounds to suspect that transactions were related to a money laundering or terrorist activity financing offence. The Nova Scotia Gaming Corporation was penalised C$231,826, for the same reporting failure and additionally for failing to keep written compliance policies up to date. Both penalties have been paid in full and both cases are closed. FINTRAC noted that in 2025-26 it issued 35 Notices of Violation totalling more than C$247 million, the largest number in a single year in its history, and has imposed more than 180 penalties since gaining the authority in 2008. New Brunswick’s finance minister stated that no evidence of money laundering was found.

Sources: FINTRAC news release, 3 September 2026: ‘FINTRAC imposes an administrative monetary penalty on the New Brunswick Lotteries and Gaming Corporation’; parallel FINTRAC release on the Nova Scotia Gaming Corporation; CBC News and BNN Bloomberg coverage, 3 September 2026

Two supervisors opened files in the same week. The UK Gambling Commission suspended the operating licences of BresBet Ltd (bresbet.com) and Bet St George Ltd (betstgeorge.com) between 28 August and 1 September, citing failure to meet regulatory standards on social responsibility and anti-money laundering protocols. The suspensions follow, in the same month, the QuinnBet (Gibraltar) Limited £609,104 order of 20 August and the Holland Park Leisure Limited £150,000 fine of 18 August. Separately, on 1 September AUSTRAC launched an investigation into Western Union Financial Services Australia and its US-based parent over how they manage money-laundering and terrorism-financing risks. The probe will examine the AML programme, transaction monitoring and governance, including whether the systems can identify known laundering typologies and suspicious transactions linked to child sexual exploitation and terrorism financing.

Sources: UK Gambling Commission enforcement page and industry press, 28 August - 1 September 2026; OCCRP report, 1 September 2026: ‘Australia Probes Western Union Over Possible Money Laundering Risks’; AUSTRAC enforcement page

On 1 September MAS issued a consultation paper on legislative amendments to the Payment Services Act 2019 to implement its regulatory framework for stablecoins. The regime covers single-currency stablecoins pegged to SGD or any G10 currency, mandates asset backing at 100% of tokens in circulation held in segregated accounts at licensed financial institutions, and prohibits paying interest on regulated stablecoins. The paper also asks for feedback on multi-jurisdictional issuance and other policy positions. Consultation closes 16 October. Singapore is one of the first jurisdictions to move from principles to a full legislative regime for stablecoins.

Sources: MAS media release, 1 September 2026: ‘MAS Consults on Legislative Amendments to Implement Stablecoin Regulatory Framework’; Bloomberg coverage, 1 September 2026; Gibson Dunn and Asia Asset briefings; CoinDesk policy coverage

On 3 September FinCEN identified nearly $13 billion linked to suspected digital-asset scams operated by overseas scam centres, and on 2 September reissued its order requiring transparency from money-services businesses along the US Southwest Border. The two moves confirm scam compounds as a first-order proceeds-generating typology in US regulator eyes and lift the disclosure floor for MSB corridors adjacent to the Border. They land on the same typology surface FATF flagged in June and align with the AUSTRAC-Western Union probe on the remittance side.

Sources: FinCEN news, 2-3 September 2026; industry aggregation via Fincrime Central and AMLCube newsletters, September 2026