Acuant Compliance Sanctions Update 4.8.22: The Russia-Ukraine Crisis

Acuant Compliance Sanctions Update 4.8.22: The Russia-Ukraine Crisis

New sanctions have been announced by the United States, United Kingdom and countries in the European Union as Russia continues—the initial attack was at the end of February of this year—its aggressive assault on Ukraine. For previously imposed sanctions, read our introductory sanctions blog and our 3.7.22 and 3.21.22 sanctions updates.

Continue reading to learn about some of the latest sanctions.

Current Snapshot of Sanctions as of 4.8.2022

United States: in response to Russia’s ongoing military assault, the United States is continuing its efforts to destabilize the Russian economy with the goal being, according to President Biden, to “increase Russia’s economic isolation” as part of concerted attempts to stop the war against Ukraine.

On April 5th, in collaboration with Germany, the US’s OFAC sanctioned Russia’s Hydra Market (or Hydra). Hydra is a major facilitator of services that include hacking, malware and ransomware-for-hire, to name a few, and is considered to be the most popular Russian darknet and the world’s largest darknet. OFAC is in the process of identifying over 100 virtual currency addresses that are associated with Hydra operations and have been used for illicit transactions, and Germany shut down Hydra servers based in Germany, seizing $25 million worth of bitcoin.

In tandem with the Hydra sanctions and seizures, and in collaboration with Estonia’s Financial Intelligence Unit, OFAC has sanctioned the virtual currency exchange Garantex—though the crypto exchange is registered in Estonia, it mostly operates out of Russia—for willfully disregarding Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) requirements by regulators and for facilitating over $100 million in illicit transactions.

As of April 6th, the Biden Administration announced new sanctions to be imposed on individuals tied to the Kremlin—this includes the two adult daughters of the Russian president in a targeted attempt to freeze any of Putin’s assets that he may have hidden with them. These sanctions mean that any individual that has been sanctioned will be completely cut off from the US banking system and have any assets in the US frozen.

Additionally, the administration has announced that all Americans—US residents and Americans abroad—are now prohibited from making any investments in Russia. More so, in coordination with G7 countries and the EU, full blocking sanctions have been imposed on two of Russia’s largest banks (except for energy purchases) and more full blocking sanctions against Russian state companies are expected to be announced.

European Union: As of April 7th, the EU has announced a new package—the fifth round of sanctions since the start of the Russian war on Ukraine—of sanctions which includes additional sanctions against more Russian oligarchs, the blocking of Russian-flagged ships in EU ports and the first sanctions package from the EU regarding Russian energy which includes a coal embargo: the coal embargo is expected to take four months to implement, likely to go into effect mid-August. The latest package also includes an export ban of up to €10 billion on high-tech goods to Russia. As of April 8th, the EU has also sanctioned President Putin’s daughters.

United Kingdom: as of April 6th, the UK imposed new sanctions—also its fifth sanctions package—on Russia which included the freezing of assets of Russia’s largest bank and a ban on all new investments in Russia. As part of the package, Russia will have a more difficult time buying quantum and advanced material technologies from the UK and the importing of iron and steel products from Russia into the UK has also been banned. As of April 8th, the UK has also sanctioned President Putin’s daughters.

United Nations: in response to the latest atrocities committed by Russia in Ukraine, Russia was officially suspended by the UN from the UN Human Rights Council on April 7th, prompting Russia to quit the body all together. As such, if Russia were to be back on the UNHRC, Russia would have to be re-elected back onto the council after its initial term was completed, rather than have the suspension lifted by the General Assembly.

 

With regulations continuing to evolve and new sanctions being imposed, having the proper AML technologies in place will be imperative for ensuring regulatory compliance and avoiding the unwitting facilitation of illicit transactions. This is particularly the case for crypto exchanges and other businesses in the cryptocurrency industry that need to screen crypto wallets: an AML solution that screens transactions against sanctions and PEP watch lists in real time is critical for staying up to date on sanctioned individuals, enterprises and virtual wallets.

Learn more about how Acuant Compliance can help all industries stay up to date and compliant with evolving sanctions and regulations.

* For newly imposed sanctions, read our 4.28.225.9.22 and 7.27.22 sanctions updates.

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