OFAC Sanctions Kinahan Organized Crime Group and Associated Businesses

An internationally coordinated operation has seen the US place sanctions on notorious Irish organized crime group Kinahan, key members of its controlling family, associates, and associated businesses. A $5m reward for information leading to the arrest or conviction of gang leaders has also been announced.

The Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned the Kinahan Organized Crime Group (KOCG) along with seven of its key members, including Irish leaders Christopher Vincent Kinahan Snr, Daniel Joseph Kinahan, Christopher Vincent Kinahan Jnr, and three associated businesses. 

“The Kinahan Organized Crime Group smuggles deadly narcotics, including cocaine, to Europe, and is a threat to the entire licit economy through its role in international money laundering,” said Under Secretary for Terrorism and Financial Intelligence, Brian Nelson. 

“Criminal groups like the KOCG prey on the most vulnerable in society and bring drug-related crime and violence, including murder, to the countries in which they operate.”

$5m Reward Offered

US ambassador to Ireland, Claire Cronin, said a $5m reward was offered for information leading to the financial disruption of the Kinahans, or the arrest or conviction of Daniel Kinahan, his father Christopher Snr and brother Christopher Jnr.

Tackling the Kinahans “is an urgent priority for President Biden and the US government” Ms. Cronin said.

“As of today the Kinahan transnational criminal organization joins the ranks of Italy’s Camorra, Mexico’s Los Zetas, Japan’s Yakuza, and Russia’s Thieves In Law,” Gregory Gatjanis, an associate director at the Treasury Department, told a news conference in Dublin.

International Trafficking and Money Laundering

The KOCG, which operates in Ireland, Spain, the UK, and the United Arab Emirates, was designated as a significant transnational criminal organization pursuant to Executive Order (EO) 13581. This EO was issued by President Obama in 2011 and states: “These organizations facilitate and aggravate violent civil conflicts and increasingly facilitate the activities of other dangerous persons.

“Significant transnational criminal organizations constitute an unusual and extraordinary threat to the national security, foreign policy, and economy of the United States, and hereby declare a national emergency to deal with that threat.”

The order also highlights the importance of fast action to ensure measures are effective: “I, therefore, determine that for these measures to be effective in addressing the national emergency declared in this order, there need be no prior notice of a listing or determination made pursuant to section 1(a) of this order.”

The KOCG emerged as a threat in the late 1990s and has become the most powerful organized crime group operating in Ireland. The group has been linked to international trafficking of drugs and firearms, murder, and international money laundering (ML). Its key leaders are based in Dubai, which is frequently used as a facilitation hub for its illicit activities. In 2021, the UK and UAE announced a partnership to help tackle illicit financial flows.

The sanctions follow a major enforcement operation related to organized crime and drug trafficking – with coordination across US agencies, Ireland, the UK, and European Union.

Along with the three leaders, associates Sean McGovern, Ian Dixon, Bernard Clancy, and John Morrissey have been sanctioned for materially assisting, sponsoring, or providing financial, material, or technological support for, or goods or services to or in support of, the KOCG.

Businesses associated with the criminal group – Nero Drinks, Hoopoe Sports, and Ducashew consulting company – have also been designated. Sanctions will block all property and interests of the designated individuals and entities in the US. 

Screening for organized crime groups: best practices

For firms, building an AML program that can detect individuals and entities that sit at the nexus of an organized crime ring requires automated, calibrated adverse media checks in order to:

• Accurately understand beneficial ownership structures
• Spot connections between individuals and entities that may not immediately appear obvious
• Detect criminal activity in another jurisdiction that may have implications for a firm’s operations elsewhere – in this case, the Kinahan group and its associates were operating across Ireland, the UK, Spain, and Dubai 

Repeated or sustained allegations, even if there have been no convictions, should trigger additional due diligence when screening and monitoring customers. Financial Action Task Force (FATF) recommendations state firms must “understand their client’s reputation” – including previous criminal liabilities related to money laundering. 

The importance of close collaboration between fraud and AML teams is also evident in this case, 

with those sanctioned known to use aliases and fraudulent IDs to try and stay under the radar. Working collaboratively and sharing information can often help join the dots, building a bigger and more detailed picture of true risk exposure. 

Well-calibrated transaction monitoring alerts are also critical and may help to pick up illicit activity not detected during initial KYC checks if fraudulent documents were used to evade detection.

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