Acuant Compliance Sanctions Update 3.7.22: The Russia-Ukraine Crisis
March 7, 2022
For previously imposed sanctions, read our introductory sanctions blog. Read on for some of the latest imposed sanctions.
Current Snapshot of Sanctions as of 3.4.2022
United States: on March 3rd, the Biden administration announced new economic sanctions on eight Russian oligarchs and their family members. These full blocking sanctions mean that any assets or property in the US owned by these sanctioned individuals or their family members will be frozen and blocked from use, and thus completely cut off from using or interacting with the US financial system. The White House has also imposed visa restrictions on an additional 19 Russian oligarchs and members of their families and is sanctioning individuals and entities that have been accused of actively spreading disinformation. Additionally, US law enforcement agencies will be working together as part of a new task force, ‘KleptoCapture’, that will go after these oligarchs’ assets. The United States has also sanctioned Belarus over their support of Russia and to prevent them from importing materials and resources that could be passed on to Russia and used militarily.
On March 4th, the Office of Foreign Assets Control (OFAC) also published three new Russia-related questions in its FAQ for the energy and oil sectors.
Canada: in addition to imposing a new 35 percent tariff on imports from Russia and Belarus, Canada has also become the first country since the start of the war to revoke ‘preferential trading partner’ status for both Russia and Belarus. Canada is expected to announce more financial sanctions in the coming days and is in the process of sending Ukraine financial aid and lethal weapons to support Ukrainian forces on the front lines.
Switzerland: as of March 4th, and after breaking its historically neutral stance, Switzerland has announced new sanctions against Russia. These sanctions include the banning of exports that could be used for Russian military purposes and of technology that could be used in aviation. More financial sanctions have also been imposed, including a ban on transactions with Russia’s Central Bank and more individuals in President Putin’s circle are having their assets frozen.
Japan: on March 3rd it was announced that Japan would be sanctioning Russian oligarchs, as well as President Alexander Lukashenko and other high-ranking Belarusian officials in condemnation of Belarus’ support of Russia’s invasion of Ukraine. Joining other countries in widespread financial sanctions, Japan has frozen the assets of President Putin, Russian oligarchs and more, and has restricted transactions with Russia’s Central Bank.
Current Snapshot of Sanctions as of 3.7.2022
While there have been multiple rounds of attempted peace talks, to no avail, the United States and other major leaders did not announce any new sanctions over the weekend. However, many well-known corporations across all industries have announced they have pulled out of Russia and/or are halting their services in the country due to Russia’s attack on Ukraine. Of course, this is also due to businesses wanting to ensure ongoing compliance with widespread and constantly evolving sanctions.
Some of the many brands halting operations in Russia include:
- Payment Providers: American Express, Visa and Mastercard have stopped all operations in Russia and have blocked transactions by Russian banks that have been sanctioned by the US.
- Fossil Fuels: BP, Exxon and Shell announced they are halting projects in Russia and/or pulling out of investments.
- Auto & Aviation: Boeing and Airbus will no longer supply Russia with parts or service support and are suspending any major operations in the country. Mercedes-Benz, Toyota and Volkswagen have announced a halt in production in Russia.
- Consumer Goods: Airbnb announced it was pausing all operations in both Russia and Belarus; Walt Disney has halted film releases in Russian theaters; fashion retailer H&M has, for the moment, paused all sales in Russia; Ikea halted any sourcing from Russia and Belarus and, for now, is closing all retail locations; in addition to halting online and in-app purchases in Russia, Nike is also temporarily shutting down all stores in the country.
- Tech: Netflix has suspended its service in Russia; Apple plans to stop selling iPhones and other devices; Russian state media channels have been blocked by Google and Google Pay has been suspended for customers of sanctioned banks; access to Russian state-controlled media outlets has been blocked by Meta (Facebook) across the EU.
United States Sanctions Update: on March 7th, the Financial Crimes Enforcement Network (FinCEN) issued a FinCEN Alert with a warning for financial institutions to be ready for attempted evasions of sanctions imposed by the US against Russia and Belarus, and any Russian or Belarusian entities, particularly through the use of convertible virtual currency (CVC) or cryptocurrency. The alert shares a number of red flags for FIs to watch for as they monitor for any suspicious behavior and seek to avoid becoming unwittingly complicit in illicit activity. FinCEN also cautions against potential Russian-related ransomware attacks. Additionally, the alert reminds FIs of the importance of conducting customer due diligence (CDD) and enhanced due diligence (EDD) as part of monitoring for suspicious activity and customers.
As Russia continues its assault on Ukraine, the United States and governments around the world are likely to continue imposing new sanctions—a good reminder of how essential screening against sanctions and PEP watch lists in real time is for businesses that want to ensure regulatory and AML compliance.
Learn more about how Acuant Compliance helps your business stay up to date with evolving regulations to ensure AML compliance.