The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has announced new sanctions against five entities and one individual in Iran, Hong Kong, Taiwan, and China. These parties are accused of supplying technology to the Iran Aircraft Manufacturing Industrial Company (HESA), a state-owned company under Iran’s Ministry of Defense and Armed Forces Logistics (MODAFL). HESA produces military aircraft and Ababil-series unmanned aerial vehicles (UAVs) used by the Islamic Revolutionary Guard Corps (IRGC).
Under Secretary of the Treasury for Terrorism and Financial Intelligence John K. Hurley stated, “Iran continues to pursue the development of asymmetric weapons capabilities, including unmanned aerial vehicles, to carry out attacks on the United States, our servicemembers and our partners and allies in the region. We will continue to put America first by disrupting Tehran’s ability to further its destabilizing agenda that undermines the stability of the region and threatens the safety of the American people.”
The sanctions were issued pursuant to Executive Order 13382, which targets those involved in proliferating weapons of mass destruction or their delivery systems. HESA was previously designated under this order in September 2008 for being owned or controlled by MODAFL and supporting the IRGC. In October 2007, both MODAFL and IRGC were also sanctioned for contributing to WMD proliferation.
According to OFAC, Javad Alizadeh Hoshyar acted as Chief Executive Officer of Iran-based Control Afzar Tabriz Co Ltd (Control Afzar), which procured computer numerical control (CNC) machines for HESA. CNC machines are essential for manufacturing precise components used in aerospace and defense applications. The agency said that Control Afzar used Hong Kong-based Clifton Trading Limited as an intermediary to conceal its involvement with HESA.
Additionally, Taiwan-based Mecatron Machinery Co Ltd and Joemars Machinery and Electric Industrial Co Ltd reportedly shipped CNC machines to Iran through similar channels intended to bypass international sanctions. Joemars Machinery established a subsidiary in China called Changzhou Joemars Industrial Automation Co Ltd.
As a result of these actions:
- Control Afzar is sanctioned for supporting HESA.
- Javad Alizadeh Hoshyar is sanctioned for acting on behalf of Control Afzar.
- Clifton Trading, Mecatron Machinery, and Joemars Machinery are sanctioned for supporting Control Afzar.
- Changzhou Joemars is sanctioned as a subsidiary controlled by Joemars Machinery.
All property or interests belonging to these designated persons within U.S. jurisdiction are blocked and must be reported to OFAC. Entities majority-owned by these individuals or companies are also subject to blocking measures. Transactions involving any blocked persons are generally prohibited unless authorized by OFAC.
Violations may lead to civil or criminal penalties against both U.S. citizens and foreign nationals. OFAC may impose civil penalties even if violations occur without intent or knowledge due to strict liability provisions; additional information about enforcement can be found in OFAC’s Economic Sanctions Enforcement Guidelines.
Foreign financial institutions could face secondary sanctions if they knowingly conduct significant transactions with any designated parties. OFAC can restrict such institutions from maintaining correspondent accounts in the United States if they facilitate such activities.
OFAC emphasizes that while its power includes designating individuals on its Specially Designated Nationals and Blocked Persons List (SDN List), it also allows for removal from this list when warranted by law: “The ultimate goal of sanctions is not to punish, but to bring about a positive change in behavior.” Guidance on seeking removal from an OFAC list is available online.
For more details about today’s designations, visit: https://home.treasury.gov/news/press-releases/jy2112
