///Monthly Sanctions Update | September 2026
KEY DEVELOPMENTS
· Iran licensing: OFAC and OFSI have each introduced a presumption of denial for Iran-related licence applications, and OFSI has confirmed that General Licence INT/2025/7628424 will not be renewed when it expires on 22 October 2026.
· UK enforcement: OFSI published a £4,732,830.58 monetary penalty imposed on Citibank, N.A., London Branch, and HMRC published a £7,438,840.13 compound settlement paid by Illumina Cambridge Limited, both for Russia-related breaches.
· US legislation: the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 was signed into law, introducing additional Russia sanctions and tariffs of up to 500%.
· New UK powers: the UK announced plans for new sanctions powers targeting those who support or profit from illegal Israeli settlement activity in the occupied West Bank.
· EU measures: the Council of the EU extended its Ukraine territorial-integrity sanctions until 22 September 2029 and adopted further listings concerning Russian information manipulation, the deportation of Ukrainian children and repression in Russia.
GLOBAL SANCTIONS
Iran
· On 10 September 2026, the US Office of Foreign Assets Control (OFAC) announced a $1,427,230 settlement with an unnamed US lawful permanent resident concerning 39 apparent violations of the Iranian Transactions and Sanctions Regulations. Between June 2019 and July 2021, the individual provided management consulting and advisory services to Iranian companies, received Iranian-origin dividends into US bank accounts and purchased property in Iran. OFAC classified the apparent violations as egregious and noted that they had not been voluntarily self-disclosed. The release emphasises that US sanctions obligations apply to lawful permanent residents wherever they are located, and highlights the importance of prompt and full cooperation with OFAC investigations.
· Also on 10 September 2026, OFAC announced a presumption of denial for Iran-related specific licence applications, effective immediately, as part of Operation Economic Outcast. The formal policy covers activities prohibited under the Iranian Transactions and Sanctions Regulations and other Iran-related authorities, and suspends the application of earlier licensing policy statements that favoured authorisation for certain activities. Specific licences may be issued only where required by law or in exceptional and urgent circumstances, such as risks to life, limb or environmental safety. Applicants should provide a written attestation demonstrating those circumstances. OFAC will assess applications individually in consultation with the US Department of State.
· On 23 September 2026, the UK Office of Financial Sanctions Implementation (OFSI) published guidance introducing an immediate presumption of denial for licence applications from Bank Sepah, Melli Bank plc, Bank Saderat, Persia International Bank and Bank Tejarat. Applications will continue to be assessed individually, but licences will be granted only where required by law or in exceptional and urgent circumstances, such as risks to life, limb or environmental safety. Any authorisation will cover only basic requirements. The guidance rules out licences permitting funds to be transferred directly or indirectly back to Iran, cash payments, or transfers between designated banks. It also confirms that General Licence INT/2025/7628424 will not be renewed when it expires on 22 October 2026. Transactions previously covered by that licence will then require authorisation under another applicable general licence or a specific licence.
Israel
· On 8 September 2026, the UK announced plans to introduce new sanctions powers targeting individuals and companies that support, facilitate or profit from illegal Israeli settlement activity in the occupied West Bank. The proposed measures include a ban on imports of goods from illegal settlements and on the advertising or promotion in the UK of land and property in those settlements. The Government also announced plans to expand the Global Human Rights sanctions regime to address serious violations of international humanitarian law, including those connected with settlement activity. Alongside these proposed changes, the UK imposed immediate sanctions under its existing powers on five individuals involved in supporting, inciting or carrying out violence against Palestinians. The announcement formed part of joint action with France and Canada to restrict trade linked to settlements.
Lebanon
· On 8 September 2026, the UK designated Al-Qard Al-Hasan (AQAH) under the Counter-Terrorism (International Sanctions) (EU Exit) Regulations 2019, imposing an asset freeze and a director disqualification sanction. The Government cited reasonable grounds to suspect that the Lebanon-based organisation is associated with Hizballah and provides financial services and funds for terrorist purposes, specifically to Hizballah. The designation prohibits dealings with AQAH’s frozen funds and economic resources, and making funds or economic resources available to it or for its benefit, unless an applicable exception or OFSI licence permits the activity.
Russia
· On 2 September 2026, OFSI published details of a £4,732,830.58 monetary penalty imposed on Citibank, N.A., London Branch on 11 August 2026 for breaches of the Russia and Global Anti-Corruption sanctions regimes. The case involved 970 payments totalling approximately £19.72 million, with most breaches occurring between February and November 2022. OFSI identified shortcomings in sanctions screening, delays in reviewing and escalating alerts, and staff errors that allowed prohibited transactions to proceed. OFSI assessed the case at the highest level of its seriousness framework. The final penalty reflected a 20% discount for voluntary disclosure and cooperation and a further 20% settlement discount.
· On 8 September 2026, HM Revenue and Customs (HMRC) published details of a £7,438,840.13 compound settlement paid by Illumina Cambridge Limited for breaches of the Russia (Sanctions) (EU Exit) Regulations 2019. Between July 2022 and January 2023, Illumina was involved in supplying sanctioned goods between overseas companies within its corporate group for onward export to Russia and other destinations. The company voluntarily disclosed the breaches, fully cooperated with HMRC and took remedial steps, including ending all business involving Russia.
· On 18 September 2026, President Trump signed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 into law. The Act establishes additional sanctions targeting Russian officials, financial institutions, state-controlled entities and vessels supporting Russia’s activities. Its tariff provisions provide for duties of up to 500% on goods imported from Russia and up to 100% on goods from qualifying countries that purchase Russian-origin crude oil or natural gas, or that facilitate Russian oil sanctions evasion, subject to statutory conditions, exceptions and presidential waiver powers. The Act also extends the Iran Sanctions Act of 1996 to 2031. The legislation sets implementation deadlines, including a 30-day deadline for specified sanctions and tariff measures.
· On 22 September 2026, the Council of the EU extended sanctions targeting individuals and entities responsible for undermining or threatening Ukraine’s territorial integrity, sovereignty and independence for three years, until 22 September 2029. The measures cover more than 3,000 individuals and entities and include asset freezes, prohibitions on making funds or economic resources available to those listed, and travel restrictions for individuals. Following its review, the Council also declined to renew the listings of three individuals and one entity, and removed three deceased individuals from the list.
· On 24 September 2026, the Council of the EU sanctioned Xenia Fedorova, a former senior executive of RT France, under its framework targeting Russia’s destabilising activities. The Council cited her involvement in information manipulation and interference, including disseminating narratives aligned with the Russian authorities after RT’s broadcasting activities were suspended in the EU. The measures impose an asset freeze and prohibit EU citizens and companies from making funds or economic resources available to her.
· On 28 September 2026, the Council of the EU sanctioned 10 individuals and 17 entities over the unlawful deportation, forcible transfer and assimilation of Ukrainian children. Adopted under the Ukraine territorial-integrity sanctions framework, the listings include officials, children’s camps, sports centres and tourism organisations, alongside Songdowon International Children’s Camp in North Korea. Those listed are subject to asset freezes and restrictions on receiving funds or economic resources, with travel bans additionally applying to individuals.
· Also on 28 September 2026, the Council of the EU sanctioned 10 individuals under its framework addressing repression and human rights abuses in Russia. The listings target judges and prosecutors involved in excluding the opposition Yabloko party from the September State Duma elections and in proceedings against its leaders, including Lev Shlosberg, Maxim Kruglov and Nikolai Rybakov. The measures impose asset freezes and prohibit EU citizens and companies from making funds or economic resources available to those listed.
GLOBAL REGULATIONS / TOOLS
General Licences
· On 10 September 2026, OFSI updated its guidance on permitted travel expenses for sanctions licence applications. The revised guidance confirms that it covers travel by legal and other representatives where the relevant payments require an OFSI licence. Applicants must justify proposed expenditure, and previous authorisation does not guarantee that similar costs will be approved again. Where higher-class flights or hotels are booked without sufficient justification, OFSI may authorise only the equivalent permitted cost, subject to supporting evidence. An OFSI licence for travel expenses does not override an applicable travel ban.
CONCLUSION
September’s developments underline a clear direction of travel: licensing authorities in both the UK and the US are narrowing the circumstances in which Iran-related activity will be authorised, while UK enforcers continue to pursue significant penalties for screening failures and the supply of sanctioned goods. With General Licence INT/2025/7628424 due to expire on 22 October 2026, businesses relying on it should review their exposure now and, where necessary, seek alternative authorisation. More broadly, firms should ensure their screening controls, alert escalation processes and group-wide export arrangements remain robust as UK, EU and US regimes continue to expand. If you have any questions about how these developments may affect your organisation, please contact a member of our sanctions team.
This newsletter is not offered, and should not be relied on, as legal advice. You should consult an attorney for advice in specific situations.