The U.S. announced on November 21 new sanctions targeting Russia’s largest remaining non-designated bank (Gazprombank), as well as dozens of other financial institutions and officials in Russia, which Secretary of the Treasury Janet Yellen said “will further diminish and degrade Russia’s war machine.”
“This sweeping action will make it harder for the Kremlin to evade U.S. sanctions and fund and equip its military,” Yellen said. She further warned, “We will continue to take decisive steps against any financial channels Russia uses to support its illegal and unprovoked war in Ukraine”.
The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) took another major step to actualize commitments made by G7 leaders to curtail Russia’s use of the international financial system to further its war against Ukraine. OFAC’s November 21 actions include the designation of Gazprombank, and more than 50 internationally connected Russian banks, 15 Russian finance officials and more than 40 Russian securities registrars.
OFAC is also issuing a highly significant alert describing sanctions risks related to Russia’s System for Transfer of Financial Messages (SPFS), which the Kremlin created and uses to evade sanctions.
Gazprombank
OFAC is designating Gazprombank Joint Stock Company (Gazprombank) alongside its six foreign subsidiaries. On top of its critical energy finance role, Gazprombank is a conduit for Russia to purchase military materiel for its war effort against Ukraine. The Russian government also uses Gazprombank to pay its soldiers, including for combat bonuses, and to compensate the families of Russian soldiers killed fighting Putin’s brutal war against Ukraine.
Australia, Canada, New Zealand, and the United Kingdom have previously sanctioned Gazprombank.
Luxembourg-based bank GPB International SA, Hong Kong-based GPB Financial Services Hong Kong Limited, Cyprus-based GPB Financial Services Limited and GPB-DI Holdings Limited, Switzerland-based Gazprombank (Switzerland) Ltd, and South Africa-based GPB Africa and Middle East Pty Ltd are wholly owned subsidiaries of Gazprombank and are now under U.S. sanctions.
Gazprombank is being designated pursuant to Executive Order (E.O.) 14024 for operating or having operated in the financial services sector of the Russian Federation economy. GPB International SA, GPB Financial Services Hong Kong Limited, GPB Financial Services Limited, GPB-DI Holdings Limited, Gazprombank (Switzerland) Ltd, and GPB Africa and Middle East Pty Ltd are being designated pursuant to E.O. 14024 for being owned or controlled by, or for having acted or purported to act for or on behalf of, directly or indirectly, Gazprombank. All entities owned 50 percent or more, directly or indirectly, by Gazprombank or the six designated Gazprombank subsidiaries, are subject to blocking, even if not identified by OFAC.
Analysts are highlighting the fact that the new Gazprom sanctions indicate the Biden administration remains serious about the application of energy sanctions against Russia in the so-called “lame duck” period before President-elect Trump takes over in January, keeping as much pressure as possible on Russia’s all-important energy revenues.
Concurrently with this action, OFAC has issued two new general licenses (GL) authorizing U.S. persons to wind down remaining transactions involving Gazprombank, among other financial institutions, and to take the necessary steps to divest from debt or equity issued by Gazprombank. OFAC is also amending Russia-related GL 53 to ensure that diplomatic banking activities involving Gazprombank are not disrupted. OFAC continues to maintain a variety of authorizations, including GLs authorizing transactions related to agricultural commodities, medicine, medical devices, certain transactions in support of non-governmental organizations, the official business of third-country diplomatic missions located in the Russian Federation, and certain transactions and official business of certain international organizations and entities.
Alert regarding Russia’s system for transfer of financial messages
OFAC is also issuing an alert underscoring the sanctions risk for foreign financial institutions that join Russia’s System for Transfer of Financial Messages (commonly known by its Russian acronym, SPFS, short for Sistema Peredachi Finansovykh Soobshcheniy). SPFS is part of the financial services sector of the Russian Federation economy because of its role facilitating communication between financial institutions engaged in Russia’s financial system. This means that any foreign financial institution that joins or has already joined SPFS may be designated for operating or having operated in the financial services sector of the Russian Federation economy pursuant to E.O. 14024.
Russia has used and promoted SPFS, designed as an alternative to Society for Worldwide Interbank Financial Telecommunication (SWIFT) network, to maintain international financial connectivity, evade sanctions, and fund its war effort. OFAC views joining SPFS after publication of this alert as a red flag and is prepared to more aggressively target foreign financial institutions that take such action. OFAC also urges stakeholders to review their exposure to institutions that have joined SPFS, as such banks may be conduits for Russian sanctions evasion.
Dozens of Russian banks designated
Further curtailing Russia’s connections to the international financial system, OFAC is designating more than 50 small-to-medium Russian banks to prevent Russia from abusing the international financial system to pay for the technology and equipment it needs to sustain its illegal and unjust war against Ukraine. Foreign financial institutions that maintain correspondent relationships with these banks should be aware that continuing to do so entails significant sanctions risk.
Please see Annex 1 below for the complete listing.
Russian Securities Registrars
OFAC is aware that Russia has attempted to evade or avoid OFAC sanctions on the National Settlement Depository by requiring, via Presidential Decree 840, the transfer of certain securities to local Russian securities registrars. Accordingly, OFAC is designating more than 40 such registrars. OFAC has also updated its document FAQ 1197 to provide further guidance on securities held at or otherwise involving these registrars.
See Annex 2 below.
Russian Central Bank Officials
In September 2022, OFAC designated Central Bank of the Russian Federation (CBR) Governor Elvira Naibullina and First Deputy Governor Olga Skorobogatova. At the time, the Treasury Department noted that Russia’s financial technocrats have, directly and indirectly, supported the Kremlin’s unprovoked war against Ukraine. Today, OFAC is designating 11 additional CBR officials, including those involved in maintaining Russia’s international financial connectivity or promoting alternate financial pathways that Russia can exploit to pay for much-needed equipment and technology.
See Annex 3 below.
VTB Shanghai and SBERBANK New Delhi staff
The latest action also includes designations of key Russian staff members at U.S.-designated VTB Bank Public Joint Stock Company’s branch in Shanghai, China (VTB Shanghai) and U.S.-designated Public Joint Stock Company Sberbank of Russia’s branch in New Delhi, India (Sberbank New Delhi).
The following Russian nationals are being designated pursuant to E.O. 14024 for operating or having operated in the financial services sector of the Russian Federation economy:
Andrei Anisimov is Sberbank New Delhi’s Deputy Managing Director.
Elena Fedkina is a VTB Shanghai Relationship Manager.
Ilya Lishenko is VTB Shanghai’s Senior Relationship Manager.
Roman Logov is VTB Shanghai’s Deputy General Manager.
Since February 2022, OFAC has designated dozens of Russia-based staff at Russian banks and continues to investigate Russian and third-country nationals working at foreign branches, representative offices, and subsidiaries of Russian banks for designation pursuant to E.O. 14024.
The usual sanctions restrictions apply
As a result of the latest OFAC action, all property and interests in property of the persons above that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC. In addition, any entities that are owned, directly or indirectly, 50 percent or more by one or more blocked persons are also blocked. All
transactions by U.S. persons or within (or transiting) the United States that involve any property or interests in property of designated or blocked persons are prohibited unless authorized by a general or specific license issued by OFAC, or exempt.
These prohibitions include the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any blocked person and the receipt of any contribution or provision of funds, goods, or services from any such person. Non-U.S. persons are also prohibited from causing or conspiring to cause U.S. persons to wittingly or unwittingly violate U.S. sanctions, as well as from engaging in conduct that evades U.S. sanctions. U.S. sanctions, including the factors that OFAC generally considers when determining an appropriate response to an apparent violation.
In addition, foreign financial institutions that conduct or facilitate significant transactions or provide any service involving Russia’s military-industrial base run the risk of being sanctioned by OFAC.
Annex 1: Dozens of Russian banks
The following Russia-based financial institutions and individual are being designated pursuant to E.O. 14024 for operating or having operated in the financial services sector of the Russian Federation economy:
Aktsionernoe Obshchestvo Bank Agroros is a bank headquartered in Saratov, Russia.
Bank Iturup LLC is a bank headquartered in Yuzhno-Sakhalinsk, Russia.
BBR Bank Joint Stock Company is a bank headquartered in Moscow, Russia.
BCS Bank AO is a bank headquartered in Moscow, Russia.
Bratsky Narodny Bank JSC is a bank headquartered in Bratsk, Russia.
Centrocredit Bank is a bank headquartered in Moscow, Russia.
Commercial Bank Energotransbank Joint Stock Company is a bank headquartered in Kaliningrad, Russia.
Commercial Bank Khlynov Joint Stock Company is a bank headquartered in Kirov, Russia.
Commercial Bank Kremlyovskiy is a bank headquartered in Moscow, Russia.
Commercial Joint Stock Bank Viking is a bank headquartered in Saint Petersburg, Russia.
Corporate Finance Bank LLC is a bank headquartered in Moscow, Russia.
Evrofinance Mosnarbank is a bank headquartered in Moscow, Russia. Evrofinance Mosnarbank was previously designated pursuant to E.O. 13850.
Fora Bank Joint Stock Commercial Bank is a bank headquartered in Moscow, Russia.
Garant Invest Bank Joint Stock is a bank headquartered in Moscow, Russia.
Interstate Bank is a bank headquartered in Moscow, Russia.
Joint Stock Commercial Bank National Reserve Bank Joint Stock Company (NRB)is a bank headquartered in Moscow, Russia. Daniel Haindl (Haindl) is the Senior Vice President of NRB. In his role at NRB, Haindl has been involved in a sanctions evasion scheme.
Joint Stock Commercial Bank Slavia Joint Stock Company is a bank headquartered in Moscow, Russia.
Joint Stock Commercial Mortgage Bank Akibank Public Joint Stock Company is a bank headquartered in Naberezhnye Chelny, Russia.
Joint Stock Company Auto Finance Bank is a bank headquartered in Moscow, Russia.
Joint Stock Company Bank Accept is a bank headquartered in Novosibirsk, Russia.
Joint Stock Company Bank Dom RF is a bank headquartered in Moscow, Russia.
Joint Stock Company Bank Finservice is a bank headquartered in Moscow, Russia.
Joint Stock Company Bank United Capital is a bank headquartered in Saint Petersburg, Russia.
Joint Stock Company Coalmetbank is a bank headquartered in Chelyabinsk, Russia.
Joint Stock Company Commercial Bank Ural FD is a bank headquartered in Perm, Russia.
Joint Stock Company Guta Bank is a bank headquartered in Moscow, Russia.
Joint Stock Company NS Bank is a bank headquartered in Moscow, Russia.
Joint Stock Company Public Trust Bank is a bank headquartered in Moscow, Russia.
Joint Stock Company Royal Credit Bank is a bank headquartered in Vladivostok, Russia.
Joint Stock Company Severgazbank is a bank headquartered in Vologda, Russia.
Joint Stock Investment Commercial Bank Eniseisk United Bank is a bank headquartered in Krasnoyarsk, Russia.
JSC Exi Bank is a bank headquartered in Saint Petersburg, Russia.
JSCB Energobank is a bank headquartered in Kazan, Russia.
Kamsky Commercial Bank is a bank headquartered in Naberezhnye Chelny, Russia.
Limited Liability Company Bank Orange is a bank headquartered in Saint Petersburg, Russia.
Limited Liability Company Bank Round is a bank headquartered in Moscow, Russia.
Limited Liability Company Krona Bank is a bank headquartered in Irkutsk, Russia.
MB Bank is a bank headquartered in Moscow, Russia.MB Bank, also known as Mir Business Bank, is the Russia-based wholly owned subsidiary of Iran’s Bank Melli Iran. MB Bank was previously designated previously designated pursuant to E.O. 13224 and E.O. 13582.
National Standard Bank Joint Stock Company is a bank headquartered in Moscow, Russia.
New Moscow Bank is a bank headquartered in Moscow, Russia.
NK Bank Joint Stock Company is a bank headquartered in Moscow, Russia.
Primorsky Territorial Commercial Bank Society with Limited Liability is a bank headquartered in Vladivostok, Russia.
Public Joint Stock Commercial Bank Derzhava is a bank headquartered in Moscow, Russia.
Public Joint Stock Company Bank Alexandrovsky is a bank headquartered in Saint Petersburg, Russia.
Public Joint Stock Company Bank Sinara is a bank headquartered in Yekaterinburg, Russia.
Public Joint Stock Company Finstar Bank is a bank headquartered in Saint Petersburg, Russia.
Public Joint Stock Company Metkombank is a bank headquartered in Kamensk-Uralskiy, Russia.
Public Joint Stock Company National Bank Trust is a bank headquartered in Moscow, Russia.
Public Joint Stock Social Commercial Bank of Primorye Primsotsbank is a bank headquartered in Vladivostok, Russia.
Rossita Bank is a bank headquartered in Moscow, Russia.
Russian Public Joint Stock Commercial Roads Bank is a bank headquartered in Moscow, Russia.
Russian Universal Bank is a bank located in Moscow, Russia.
Vitabank PJSC is a bank headquartered in Podolsk, Russia.
Waybank JSC is a bank headquartered in Moscow, Russia.
Annex 2: Russian Securities Registrars
The following Russia-based financial institutions function as registrars and are being designated pursuant to E.O. 14024 for operating or having operated in the financial services sector of the Russian Federation economy:
Aktsionernoe Obshchestvo Agentstvo Regionalnyi Nezavisimyi Registrator is a registrar based in Tula, Russia, and Lipetsk, Russia.
Aktsionernoe Obshchestvo Mezhregionalnyi Registratorskii Tsentr is a registrar based in Moscow, Russia.
Aktsionernoe Obshchestvo Natsionalnaya Spetsializirovannaya Finansovaya Kompaniya is a registrar based in Novosibirsk, Russia.
Aktsionernoe Obshchestvo Nezavisimaya Registratorskaya Kompaniya R.O.S.T. is a registrar based in Moscow, Russia.
Aktsionernoe Obshchestvo Professionalnyi Registratsionnyi Tsentr is a registrar based in Moscow, Russia.
Aktsionernoe Obshchestvo Registrator Kapital is a registrar based in Yekaterinburg, Russia.
Aktsionernoe Obshchestvo Spetsializirovannyi Registrator Kompas is a registrar based in Novokuznetsk, Russia.
Aktsionernoe Obshchestvo Surgutinvestneft is a registrar based in Surgut, Russia.
Aktsionernoe Obshchestvo Vedenie Reestrov Kompanii is a registrar based in Yekaterinburg, Russia.
Aktsionernoe Obshchestvo Independent Specialized Depository is a registrar based in Moscow, Russia.
AO Reestr is a registrar based in Moscow, Russia.
Aktsionernoe Obshchestvo Registratsionnaya Kompaniya Tsentr Invest is a registrar based in Irkutsk, Russia, and Moscow, Russia.
Aktsionernoe Obshchestvo Depozitarnaya Kompaniya Region is a registrar based in Moscow, Russia.
Evroaziatskii Registrator is a registrar based in Kazan, Russia.
AO Spetsializirovannyi Depozitarii Infinitum is a registrar based in Moscow, Russia.
Joint Stock Company Aktiv is a registrar based in Saint Petersburg, Russia.
Joint Stock Company Industria Reestr is a registrar based in Moscow, Russia.
Joint Stock Company RDC Paritet is a registrar based in Moscow, Russia.
Joint Stock Company Registrator Intraco is a registrar based in Perm, Russia.
Joint Stock Company Registry Society Status is a registrar based in Moscow, Russia.
JSC DRAGA is a registrar based in Moscow, Russia, and Saint Petersburg, Russia.
JSC Republican Specialregistrar Yakut Fund Center is a registrar based in Yakutsk, Russia.
JSC RT Registrar is a registrar based in Moscow, Russia.
JSC Service Reestr is a registrar based in Moscow, Russia.
JSC Noviy Registrator is a registrar based in Moscow, Russia.
Korporativnaya Registratorskaya Kompaniya is a registrar based in Moscow, Russia.
Limited Liability Company Depositary and Corporate Technologies is a registrar based in Moscow, Russia.
Limited Liability Company Special Depository Partner is a registrar based in Moscow, Russia.
Limited Liability Company Specialized Depository Company Garant is a registrar based in Moscow, Russia.
Moskovskii Fondovyi Tsentr is a registrar based in Moscow, Russia.
National Custodial Company Stock Closed Corporation is a registrar based in Moscow, Russia.
Obshchestvo S Ogranichennoy Otvetsvennostyu Oboronregistr is a registrar based in Moscow, Russia.
OOO Partner is a registrar based in Cherepovets, Russia.
OOO Reestr RN is a registrar based in Moscow, Russia.
OOO Registrator Garant is a registrar based in Moscow, Russia.
Registrator KRTS is a registrar based in Krasnodar, Russia.
Spetsializirovannyi Depozitarii Depo Plaza is a registrar based in Moscow, Russia.
Spetsializirovannyi Registrator Rekom is a registrar based in Staryy Oskol, Russia.
Tsentr Ucheta i Registratsii is a registrar based in Saint Petersburg, Russia.
Yuzhno Regionalnyi Registrator is a registrar based in Rostov-na-Donu, Russia.
Zakrytoe Aktsionernoe Obshchestvo Pervyi Spetsializirovannyi Depozitarii is a registrar based in Moscow, Russia.
Annex 3: Russian Central Bank Officials
The following Russian nationals are officials at the Central Bank of the Russian Federation (CBR), which is subject to Directives 1 and 4 of E.O. 14024, and are being designated pursuant to E.O. 14024 for operating or having operated in the financial services sector of the Russian Federation economy:
Alla Bakina (Bakina) is the Director of the National Payment System Department of the CBR and is responsible for modernizing CBR payment systems. Bakina is involved in expanding the reach of Russia’s System for Transfer of Financial Messages (SPFS) and Faster Payments System (SBP).
Vladimir Chistyukhin has been a First Deputy Governor of the CBR since 2022 and a Member of the Board of Directors of the CBR since 2023.
Elizaveta Danilova is Director of the Financial Stability Department at the CBR and has been a Member of the Board of Directors of the CBR since 2023.
Gulnara Khaidarshina is the Director of the Department for Cooperation with International Organizations at the CBR.
Mikhail Anatolyevich Kovrigin is the Director of the International Settlements Department at the CBR.
Ekaterina Lozgacheva has been the Director of the Financial Market Strategy Department of the CBR since 2023 and previously served in other positions at the CBR dating back to 2011.
Alexandr Morozov has been the Director of the Research and Forecasting Department at the CBR since 2015.
Olga Vasilyevna Polyakova has been a Deputy Governor of the CBR since 2016 and a Member of the Board of Directors of the CBR since 2021.
Kirill Pronin (Pronin) is the Director of the Financial Market Infrastructure at the CBR. Pronin was previously Director of the CBR’s Department of Financial Technologies.
Bogdan Shablya is head of the CBR’s Financial Monitoring and Currency Control Department and has worked at the CBR for more than 25 years.
Dmitry Tulin is a First Deputy Governor of the CBR and has been a Member of the Board of Directors of the CBR since 2020.
