finance industry

US warns financial institutions to be on watch for Russian sanctions evasion

Reuters
US warns financial institutions to be on watch for Russian sanctions evasion

CITIBANK. A Citibank branch is seen in central Moscow, Russia, August 24, 2016.

Reuters

The Financial Crimes Enforcement Network says both Russian state actors and oligarchs might attempt to evade sanctions

WASHINGTON, USA – The United States on Monday, March 7, warned financial institutions to watch out for potential Russian sanctions evasion attempts following rafts of sanctions imposed by Washington on Russia over its invasion of Ukraine.

The Financial Crimes Enforcement Network (FinCEN) issued an alert on Monday advising all financial institutions to be vigilant and laying out examples of red flags that it said would help identify sanctions evasion activity, including the use of shell companies.

“In the face of mounting economic pressure on Russia, it is vitally important for US financial institutions to be vigilant about potential Russian sanctions evasion, including by both state actors and oligarchs,” FinCEN Acting Director Him Das said in a statement.

The United States has imposed several rounds of sanctions – targeting Russian President Vladimir Putin, oligarchs, the central bank, and major lenders – after Russian forces invaded Ukraine in the biggest assault on a European state since World War II. Moscow calls the assault a “special operation.”

FinCEN said in the alert on Monday that as a result of the measures, targeted Russian and Belarusian actors may seek to evade sanctions. The activities could be conducted through a variety of actors, the alert said, including convertible virtual currency exchangers and administrators.

The alert also warned of possible ransomware attacks.

FinCEN called on financial institutions to report suspicious activity related to possible sanctions evasion quickly and conduct risk-based customer due diligence.

“Although we have not seen widespread evasion of our sanctions using methods such as cryptocurrency, prompt reporting of suspicious activity contributes to our national security and our efforts to support Ukraine and its people,” Das said. – Rappler.com