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Enforcement Release: July 15, 2025
Interactive Brokers LLC Settles with OFAC for $11,832,136 Related to Apparent Violations of Multiple Sanctions Regulations
Interactive Brokers LLC (IB), a Greenwich, Connecticut-based global electronic broker-dealer providing brokerage and investment services to millions of customers worldwide through its online brokerage platform, has agreed to pay the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) $11,832,136 to settle its potential civil liability for apparent violations of multiple OFAC sanctions programs. From July 15, 2016 to January 31, 2024, IB provided brokerage and investment services to persons in Iran, Cuba, Syria, and the Crimea region of Ukraine (“Crimea”), processed trades in securities subject to the Chinese Military-Industrial Complex program, conducted transactions involving blocked persons under OFAC’s Russia, Global Magnitsky, Venezuela, and Syria sanctions programs, and engaged in new investment in the Russian Federation.
The settlement...
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1) This enforcement action is notable for a number of unusual characteristics, including being the first ever enforcement actions involving violations of OFAC's Russia-related new investment prohibition, the prohibitions on certain transactions of entities on the Chinese Military Companies Sanctions list, and Venezuela-related EO 13692.
2) CRIMEA IP
As it relates to OFAC's compliance expectations concerning the Crimea embargo, it is clear that OFAC expects IP-based geoblocking tied to the embargoed area ("IB failed to include Crimea in its IP Blocking List,2 and, from May 2019 to June 2021, IB failed to include IP addresses linked to the major Crimean city of Sevastopol in its IP Blocking List, leading to additional apparent violations.") Similar logic presumably applies to the DNR/LNR embargo, though it is less clear whether IP-based blocking is fully practicable given the...