On September 29, 2026, the U.S. Office of Foreign Assets Control (OFAC) added 23 individuals and 30 entities to its Specially Designated Nationals (SDN) List, targeting the Sinaloa Cartel's Los Mayos faction and an Iranian military procurement network fronted by companies in Saudi Arabia, Pakistan, Turkey, Hong Kong and China. OFAC also amended six existing entries, three (the Yakovlev design bureau, MG-FLOT and Saha Airlines) to add the new IRAN-CON-ARMS-EO tag. The designations are effective on listing.
US banks and credit unions with USD clearing and correspondent banking exposure, US-Mexico money transmitters and remittance firms (casa de cambio), US virtual asset service providers, US importers and exporters with Mexico supply-chain exposure, and global banks with USD correspondent access must immediately screen customer databases, counterparty lists and transaction payees against the updated SDN list, applying the 50 Percent Rule to the newly designated Mexican and Iranian entities, and block, freeze or reject any matches, or face strict-liability civil penalties under the International Emergency Economic Powers Act (IEEPA) and 31 CFR Part 501, possible criminal penalties, blocked or rejected transactions, and secondary-sanctions exposure for non-US persons transacting in USD.
What was designated on September 29, 2026?
The batch runs under two operations. The Sinaloa Cartel Leadership and Corruption Networks operation adds 18 individuals and 25 entities tied to the Los Mayos faction, all tagged [SDGT] and [ILLICIT-DRUGS-EO14059], with secondary-sanctions risk under section 1(b) of Executive Order 13224, as amended by EO 13886. The Mexican entities include two Baja California casas de cambio (Galerias Centro Cambiario in Tijuana, also known as Magic Casa de Cambio, and Mia Centro Cambiario in Mexicali), private security firms (Inteliproof Efficient, Videovigilancia Colaborativa, Proyecto Alerta Verde), real estate, gas stations and restaurant holdings, which widens the screening audience into trade and finance.
Operation Economic Outcast designates five individuals and five entities in an Iranian military procurement network. The individuals (Ali Fotowat Ahmady, Parisa Lali, Fen Li, Seyyed Asghar Alizadeh Tabatabai, Waseem Pasha Tajammal) operate from Iran, China and Pakistan, and the entities include Kavoshcom Asia R and D Group in Tehran, three Cavalier Dynamics front companies in Saudi Arabia, Pakistan and Turkey, and EC Mojo Technology in Hong Kong. All are tagged [NPWMD] and [IFSR], linked to Iran's Ministry of Defense and Armed Forces Logistics, and marked Subject to Secondary Sanctions. Three existing entries (the Yakovlev design bureau, MG-FLOT, and Saha Airlines) were amended to add the IRAN-CON-ARMS-EO tag, connecting Russia-Iran conventional arms flows.
Who has to screen, and against what?
OFAC SDN designations are blocking, not enforcement against a breach: the duty is to screen and freeze. US persons are prohibited from dealing with listed parties, and any entity 50 percent or more owned, individually or in the aggregate, by blocked persons is itself blocked even if not separately listed (the 50 Percent Rule). Because the designations reach casas de cambio and a cross-border procurement network, the exposed audience spans USD clearing banks, US-Mexico remittance corridors, virtual asset service providers, importers and exporters, and non-US banks with USD correspondent access.
What must compliance teams do immediately?
- Screen customer databases, counterparty lists, beneficial owners and transaction payees against the updated SDN list, including the 30 new entities and 23 individuals.
- Apply the 50 Percent Rule to the new Mexican and Iranian entities: any subsidiary, joint venture or affiliate 50 percent or more owned by them is blocked even without a separate listing.
- Block, freeze or reject any match in accounts, payments, crypto wallets or trade flows, and file the required blocking or rejected transaction report under 31 CFR Part 501.
- Check USD correspondent and nostro exposure for secondary-sanctions risk on the entities marked Subject to Secondary Sanctions (the Kavoshcom and Cavalier Dynamics network, and the Sinaloa individuals tagged under EO 13224).
- Review historical transactions back to the listing date and consider voluntary self-disclosure for any undisclosed matches, which can mitigate civil penalties by up to 50 percent under 31 CFR Part 501, Appendix A.
What happens otherwise?
OFAC operates a strict-liability regime: civil penalties attach without intent under IEEPA (50 U.S.C. 1701-1706) and the Reporting, Procedures and Penalties Regulations at 31 CFR Part 501, with per-violation maxima voluntary self-disclosure can mitigate up to 50 percent. Criminal exposure, blocked or rejected transactions, and secondary-sanctions risk for non-US persons transacting in USD with the designated targets follow. A team that catches a match after a payment clears has already missed the moment to act.
How this differs from Ukraine's parallel sanctions
Ukraine's Decree 960/2026, adopted on September 28, 2026, applies fixed 10-year national sanctions to 44 persons under Ukraine's own NSDC authority. The OFAC designations above are indefinite (they stay in force until OFAC formally delists the target) and expose non-US persons to secondary sanctions when transacting in USD with the listed Mexican and Iranian entities, under section 1(b) of Executive Order 13224, a reach Ukraine's decrees lack. See our briefing on Ukraine's Decree 960/2026.
Verify whether your institution holds accounts or correspondent relationships touching the named casas de cambio, the Cavalier Dynamics network or the Sinaloa-linked Mexican entities; screen against the September 29, 2026 SDN update; and brief sanctions and trade-finance teams before the next clearing window. Obsidian's per-jurisdiction monitoring surfaces SDN list updates the moment OFAC publishes them, so your screening runs against the current list.
