Financial Crime World

US Imposes Sanctions on Eritrean Entities and Individuals over Ethiopia Interference

Background

The United States has imposed sanctions on four Eritrean entities and two individuals, citing Eritrea’s interference in the escalating humanitarian crisis in Ethiopia. The Treasury Department’s Office of Foreign Assets Control (OFAC) condemned Eritrea’s involvement in the conflict, urging parties to come to the negotiating table without preconditions.

Sanctioned Entities

The sanctioned entities include:

  • Eritrean Defense Force (EDF): A military organization responsible for defending Eritrea.
  • People’s Front for Democracy and Justice (PFDJ): The only legal political party in Eritrea, led by President Isaias Afwerki.
  • Hidri Trust: Controls all of the PFDJ’s business interests.
  • Red Sea Trading Corporation (RSTC): Funds and provides assistance to the PFDJ.

Sanctioned Individuals

The two individuals sanctioned are:

  • Abraha Kassa Nemariam: Head of the Eritrean National Security Office.
  • Hagos Ghebrehiwet W Kidan: Economic advisor to the PFDJ and CEO of RSTC.

Implications

All property and interests belonging to these entities and individuals, including those in the US or controlled by US persons, are blocked and must be reported to OFAC. This move serves as a warning to Eritrea’s government, with OFAC director Andrea Gacki stating that the US stands ready to take further action, including against the Ethiopian government and Tigray People’s Liberation Front, if there is no progress towards a cessation of hostilities.

Concerns over Banking Security

The banking security matters in Eritrea have raised concerns among international observers, who worry that the country’s involvement in the Ethiopian conflict could exacerbate the humanitarian crisis and undermine regional stability. As the situation continues to unfold, experts are closely monitoring the implications for financial institutions operating in Eritrea, including banks and other financial entities.

Next Steps

The US stands ready to take further action if there is no progress towards a cessation of hostilities. The international community is urging parties to come to the negotiating table without preconditions to resolve the conflict peacefully.