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Russian diesel deal challenges congressional sanctions policy and divides allies

The diesel agreement puts the administration’s drive to lower fuel prices before the midterms at odds with Congress’s effort to deny Moscow revenue for its war against Ukraine and Britain’s commitment to maintaining sanctions pressure.
International Criminal Court, The Hague, Netherlands
The licenses avert an immediate operational shutdown but leave the ICC under sustained U.S. leverage. Routine subscriptions, telecommunications and enterprise software may continue—some indefinitely, others only through April 7, 2027—but vendors must still screen separately sanctioned officials and may withdraw services voluntarily.

DOJ Signals Broader Criminal Exposure in Qui Tam and Trade Fraud Matters

The directive signals that trade-fraud and qui tam matters may no longer remain discrete civil investigations. Allegations involving unpaid duties, false origin claims, undervaluation, misclassification or forced labor may prompt parallel criminal, tax, securities and asset-forfeiture inquiries. Importers and other supply-chain participants should investigate credible allegations promptly, preserve evidence and assess disclosure options before DOJ independently identifies the conduct.

California Executive Charged in $300 Million AI Server Export Scheme

A California technology executive was arrested October 1 on charges that he helped smuggle more than $300 million in export-controlled computer servers to China through intermediaries in Malaysia and Singapore.

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Welcome to Your WTTL

The Washington Tariff and Trade Letter introduces a web-based format for easier review, research and sharing.  Clicking on a story in the newsletter will now bring you to the full text on our new web site. A .pdf version of the newsletter is available below.   For any questions about website access and your subscription, please contact us at Info@TradeRegs.com – Or call the Editor, Frank Ruffing, at +1.703.283.5220

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Vol 46 No. 41, October 12, 2026

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FinCEN Assesses $1.2 Billion Against Bank of America, Citing National Security Risks

The action casts longstanding AML failures as a national security threat, emphasizing Chinese money laundering networks and illicit finance along the southwest border. Beneath that framing, Bank of America admits that deficient controls caused missed or delayed reporting of more than $5 billion in suspicious activity despite repeated warnings.

Moolenaar Seeks to Build Support for Research Security Legislation

Rep. John Moolenaar (R-MI) is seeking to find support for legislation restricting federally funded research collaborations with entities on U.S. government restricted lists, releasing a report that challenges objections to stronger safeguards and a supplemental collection of historical investigative records.
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Postal Shipments to U.S., EU Fall After Customs Changes

International postal shipments entering the United States and the European Union fell sharply after changes to duty treatment for low-value imports, according to the Universal Postal Union’s State of the Postal Sector 2026 report.

OFAC Schools Forwarder $175K for Shabby Screening and Lack of Cooperation

OFAC’s $175,015 settlement with Pegasus Worldwide Logistics underscores that sanctions exposure extends beyond deficient screening to incomplete responses during an investigation. The freight forwarder failed to identify a designated supplier despite matching contact information, then took six months to provide a complete subpoena response, prompting six separate reporting violations.

Amidi penalty puts outbound-investment reporting in focus

Treasury’s first outbound-investment penalty shows that a missed filing can carry substantial consequences even when the government has not alleged that the underlying investment was prohibited.

Green Card Crackdown May Increase Offshore Export-Control Risk

The Trump administration’s suspension of Microsoft, Adobe and six major IT-services companies from the federal permanent labor certification program could produce an unintended trade-compliance consequence: greater reliance on personnel working outside the United States and more cross-border transfers of controlled technology.
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The case illustrates how an AML program can fail when its risk assessment does not reflect its core business. Regulators found that American Express gave insufficient attention to its dominant credit and charge card operations, allowing weaknesses in customer due diligence, transaction monitoring and reporting to persist for years.
U.S. Court of International Trade, New York
A three-judge panel at the Court of International Trade has asked for additional briefing in the lead challenge to USTR’s Section 301 forced-labor duties, narrowing the dispute into threshold and merits questions that could determine both whether the action survives and how broadly any relief would apply.
The bipartisan appeal puts pressure on the administration to translate the new sanctions law into enforcement before most provisions take effect Oct.
U.S. Treasury Building, Washington
The case shows that even a small investment through an overseas subsidiary can expose a U.S. parent to substantial penalties. Treasury fined Amidi more than twice the underlying investment’s value for a missed notification, underscoring the need for investors and counsel to identify covered transactions across foreign funds and subsidiaries, document their diligence and meet filing deadlines—even when an investment is permitted.
The USTR inquiry opens a potential new front in U.S.-EU trade tensions just as Brussels considers extending CBAM from basic metals to hundreds of downstream steel- and aluminum-intensive products. European Commission President Ursula von der Leyen’s decision to offer exporters a one-year reprieve from separate EU methane requirements signals some willingness to ease climate-related trade rules as compliance and energy costs become acute.

U.S. Trade Deficit Widens to $105.6 Billion as Imports Hit Record

The U.S. trade deficit widened for a second month in August as imports climbed to a record $420.8 billion, propelled by capital goods and industrial supplies, while exports posted a smaller increase.

Members of the FEMA region V Homeland Response Force (HRF), comprised of Ohio National Guard Soldiers and Airmen, prepare for an exercise evaluation by the Army Interagency Training and Education Center May 31, 2019, at Camp James A. Garfield, Ohio.

Russia Lab Death Sharpens Debate Over Biotechnology Controls

 An unexplained death at a Russian high-containment biological research facility is putting renewed attention on a problem that U.S. export-control officials have been confronting for several years: biotechnology is advancing faster than the regulatory architecture intended to keep dangerous biological capabilities from proliferating.
Criminal cases to date have been directed at frontline employees and external actors rather than bank leadership.

Another TD Branch Employee Guilty as Branch-Level Prosecutions Mount

Another former TD Bank branch employee has pleaded guilty to taking bribes to help launder millions of dollars to Colombia, extending a series of prosecutions that has targeted tellers, retail employees and an assistant branch manager while producing no criminal charges against senior bank executives.

Treasury Withdraws Crypto Mixing and Self-Hosted Wallet Proposals, Citing Privacy and Reporting Concerns

The withdrawals reflect Treasury’s broader shift toward easing digital asset regulation, giving greater weight to financial privacy and compliance costs despite documented use of mixers in illicit finance. Alongside the department’s removal of Tornado Cash sanctions, the move signals a retreat from some preventive measures aimed at cryptocurrency abuse. FinCEN nevertheless says it will continue monitoring mixers and may act against illicit activity.

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