The US Treasury Department’s Office of Foreign Assets Control (OFAC) has announced an $11.8 million settlement with Interactive Brokers LLC (IBKR), one of the world’s largest electronic trading platforms. The penalty stems from multiple apparent violations of US sanctions laws, which saw the firm processing financial transactions and offering services to individuals and entities in sanctioned regions and sectors over a multi-year period.

The enforcement action is yet another signal from Washington that sanctions compliance remains a core component of the US national security and foreign policy strategy-and that regulators expect even highly automated financial institutions to implement vigilant, up-to-date compliance systems.

OFAC’s investigation found that Interactive Brokers failed to prevent clients located in jurisdictions subject to strict US sanctions-including Iran, Syria, Cuba, and the Crimean region of Ukraine-from using its trading platform. By allowing access and facilitating financial activity in these jurisdictions, IBKR exposed itself to potential civil liability under multiple sanctions regimes.

These regions are designated by the US government as high-risk due to concerns over terrorism, military aggression, corruption, and human rights abuses. Consequently, American firms are strictly prohibited from offering financial services or conducting any form of commerce with entities or individuals based in those areas without explicit authorization from OFAC.

Interactive Brokers’ systems, however, reportedly permitted the execution of trades, the opening of accounts, and other financial transactions that should have been blocked.

Beyond the geographic........

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