On April 29, 2022, the UK introduced new measures to prevent the provision of internet services to or for the benefit of designated persons.[1] These measures apply to the whole territory of the UK and to conduct by UK persons where that conduct is wholly or partly outside the UK. The designated entities or individuals (“Designated Persons”) can be found on the regularly updated UK Sanctions List with the tag “Internet Sanctions List”. To date, only V-Novosti and Rossiya Segodnya are designated under those authorities.

Continue Reading Introduction of internet-related Russia trade sanctions in the UK

Updated as of April 12, 2022

It has now been more than 40 days since the start of Putin’s brutal invasion of Ukraine. Today, following the recent revelations of the atrocities committed in Bucha, Ukraine by Russian armed forces, the United States – in coordination with the G7 and the EU – imposed new sanctions on Russia (see here). The sweeping new sanctions seek to further restrict Russia’s access to dollars and put economic pressure on Putin to end the war. The sanctions include a ban on all new investment in Russia as well as designations of Russia’s largest financial institutions (i.e., Sberbank and Alfa Bank), critical state-owned enterprises, and Russian government officials and their family members, including Putin’s children.

Continue Reading U.S. and Allies Impose Additional Severe Costs on Russia for Atrocities in Ukraine

The recent comprehensive economic sanctions by the U.S. and other nations against Russia has propelled the crypto community onto the geo-political stage in a major way. As with other forms of payment and methods of money transmission, cryptocurrency and cryptocurrency exchanges are at risk for exploitation by criminal actors, including those attempting to evade economic sanctions. Several attributes of cryptocurrencies that are usually touted in favor of the technology—pseudonymity, decentralization, digitalization—are now giving government officials, regulators, and lawmakers cause for concern in the sanctions climate. In response, leaders in the crypto community are voicing support of sanctions compliance, and citing aspects of the technology—traceability, immutability, visibility—in reassurance of it. As discussed below, there are several steps that crypto platforms can take to further efforts in blocking and detecting sanctions evasion activity on their platforms.

Continue Reading Crypto and Russia Sanctions: A Primer and Survival Guide For Crypto Companies

Updated as of March 9, 2022

Key Takeaways of OFAC (Treasury), BIS (Commerce), and State Actions

  • Major Russian Banks Blocked from the U.S. Financial System


Continue Reading Russian Risk: Transactions with Russian Banks and Exports to Russia Create Greatest Exposure Under New U.S. Ukraine-Related Sanctions

Updated as of March 3, 2022

Key Takeaways of EU and UK Recent Actions Against Russia and Ukraine Breakaway Regions

  • The EU adopted sanctions restrictions targeting financial institutions, other entities, and individuals, and imposing territorial restrictions on Donetsk and Luhansk. The sanctions also include broad export restrictions to Russia detailed below.
  • In the UK, Prime Minister Boris Johnson has promised and adopted a “massive package of economic sanctions” including asset freeze restrictions; potential exclusion of Russian banks from the UK financial system, including preventing access by such banks to GBP and clearing services in the UK; and dual-use export restrictions to Russia.


Continue Reading Russian Risk: Transactions with Russian Banks and Exports to Russia Create Greatest Exposure Under New EU and UK Ukraine-Related Sanctions

Updated as of February 25, 2022

Key Takeaways

  • On February 21, 2022, the White House issued a new Executive Order (EO) that imposes comprehensive sanctions


Continue Reading U.S., UK and EU Sanctions Over the Donetsk People’s Republic (DNR) and Luhansk People’s Republic (LNR) Regions of Ukraine

With Russian forces massing at the Ukrainian border, the U.S. and EU have been warning of severe economic sanctions. While we wait and watch this brinksmanship play out, it is worth considering how businesses, and particularly banks, might prepare for what comes next.

Continue Reading A Ruble Without a Cause: What Economic Sanctions on Russia May Mean for Your Business and Global Finance

Background

Last Friday, the Office of Foreign Assets Control (OFAC) published more targeted guidance for digital asset companies related to compliance with sanctions and best practices for mitigating risks. This guide comes on the heels of OFAC’s first enforcement action against a cryptocurrency exchange, SUEX (which we discussed in our blog here). Given the rise of ransomware threats from malicious cyber-actors that are often linked to sanctioned countries and persons, the lack of very robust regulatory oversight of the virtual currency world, the emerging nature of the technologies, and the growth of the market, it is clear that OFAC hopes crypto companies will pay more attention to sanctions risks and compliance with the issuance of this guidance. While the guide covers a lot of familiar territory, we outline a few key takeaways below.

Continue Reading Sanctions Compliance for Crypto: OFAC Issues Guidance Targeting Virtual Currency Industry

If your company is like many, your board of directors may be demanding that you put more effort into environmental, social, and governance issues, which have become known by the now-ubiquitous acronym “ESG.” Those demands don’t come from nowhere: consumers are demanding transparency and social responsibility. In particular, if your company does business internationally, regulators are focused on international social justice issues (such as the use of forced labor) more than ever.

Continue Reading Does Your Trade Policy Support Your Company’s Values?

Companies are putting forth more effort, thought, commitment, and resources into environmental, social, and corporate governance (ESG) considerations across their business lines. The focus of ESG has primarily centered around climate change and sustainability, but the “S” in ESG is becoming increasingly important to consumers and other stakeholders. As global corporate citizens become more vocal about asserting their identity and values, it is critical to think about how their global trade and compliance policies and supply chains reflect those values. Issues like forced labor in the supply chain, third party diligence, and how to build an ethical culture are part and parcel of a strong compliance program. But these issues also present opportunities for companies to reflect their values in a fundamental way and speak to what consumers are demanding with their dollars.

Continue Reading ESG, Global Trade, and Forced Labor: Aligning Compliance with Company Values

Yesterday, the Treasury Department’s Office of Foreign Assets Control (OFAC) announced sanctions on SUEX OTC, S.R.O, a cryptocurrency exchange, for its role in laundering money to ransomware attackers. According to OFAC, SUEX facilitated criminal transactions involving at least eight ransomware variants and 40% of SUEX’s known transaction history involved bad actors. The designation of SUEX is the first time OFAC has sanctioned a virtual currency platform – and this approach may prove to be a useful regulatory tool to make malicious cyberactivity less profitable and therefore deter cyber-criminals. Treasury Secretary Janet Yellen said the government is “committed to using the full range of measures, to include sanctions and regulatory tools, to disrupt, deter, and prevent ransomware attack[s].”

Continue Reading First OFAC Sanctions Against a Cryptocurrency Exchange: Could the Designation of SUEX Signal an Enforcement Trend to Combat Cybercrime?