On Thursday, August 15, the US Treasury Department imposed sanctions on several companies, individuals, and vessels, including a Hong Kong-based company. These entities are suspected of representing a network supporting Houthi armed groups in transporting Iranian goods to China and other areas, including oil and liquefied petroleum gas (LPG).
The US Treasury Department’s Office of Foreign Assets Control (OFAC) stated that the network of Sa’id al-Jamal, a Houthi financial official, provided financial support to the terrorist organization, enabling them to carry out attacks on the Red Sea shipping and civilian infrastructure with serious consequences for the region and the international community.
Bradley T. Smith, Acting Deputy Secretary of the US Treasury Department responsible for counterterrorism and financial intelligence, emphasized the commitment to cutting off Iran’s funding to terrorist proxies like Hezbollah and Houthi armed groups. He stated that those attempting to finance these organizations to disrupt stability would be held accountable.
In addition to targeting the al-Jamal network, OFAC also identified Kai Heng Long Global Energy Limited, based in Hong Kong, for transporting millions of dollars worth of Iranian LPG for Hezbollah, freezing four vessels owned and operated by the company.
The OFAC designated seven entities and related vessels for sanctions under the Special Designated Nationals (SDN) list, including ARAFAT SHIPPING CO, DP SHIPPING LIMITED, KFD GENERAL TRADING LLC, Kai Heng Long Global Energy Limited (Hong Kong), KDS SHIPPING LIMITED, ONX TRADING, and Transmarine Navigation.
KFD General Trading L.L.C. based in the UAE was also found to assist the al-Jamal network in transporting Iranian goods to China, including oil and LPG.
The vessels associated with the sanctioned entities include the DIVINE POWER (T8A4414) tanker flying the Palauan flag (affiliated with DP SHIPPING LIMITED), FENGSHUN (formerly VENUS 7) (H9ZK) LPG tanker flying the Eswatini flag (affiliated with Kai Heng Long Global Energy Limited), LADY LIBERTY (3FTM2) LPG tanker flying the São Tomé and Príncipe flag (affiliated with Kai Heng Long Global Energy Limited), LPG OM (T8A4415) LPG tanker flying the Palauan flag (affiliated with KDS SHIPPING LIMITED), PARVATI (3E3842) LPG tanker flying the Panamanian flag (affiliated with Kai Heng Long Global Energy Limited), RAHA GAS (T8A4761) LPG tanker flying the Palauan flag (affiliated with ARAFAT SHIPPING CO), and VICTORIA (S9Z6) LPG tanker flying the São Tomé and Príncipe flag (affiliated with Kai Heng Long Global Energy Limited).
The Talaqi Group, controlled by Hezbollah, utilized the FENGSHUN and VICTORIA vessels to transport millions of dollars worth of LPG from Iran to China. In early July 2024, the FENGSHUN and VICTORIA conducted a ship-to-ship (STS) transfer in Singapore before delivering the goods to China.
The US State Department designated Hezbollah as a special and organized crime group on October 31, 2001. On September 4, 2019, the US Treasury Department identified the Talaqi Group as owned or controlled by Hezbollah official Muhammad Qasim al-Bazzal. Bazzal was identified on November 20, 2018, for overseeing the operations of the Talaqi Group and other front companies for Hezbollah to profit from the transfer and sale of Iranian oil products and other goods.
All properties, assets, and interests in properties owned by the mentioned individuals and entities, as well as any entity in which they have a 50% or more ownership interest, located within the US or controlled by US persons, have been frozen and reported to the Office of Foreign Assets Control.
Furthermore, financial institutions and individuals engaging in certain transactions or activities with the sanctioned entities and individuals may face secondary sanctions.
The statement stressed that the ultimate goal of sanctions is not punishment but to induce positive behavioral change in the sanctioned parties and provide an opportunity for reform.