IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Inflow

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

firm-specific

JUMBO

No

TARIFF PEAK

No
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Inception date: 30 Jun 2022 | Removal date: open ended

Controls on commercial transactions and investment instruments

On 30 June 2022, the Office of Foreign Assets Control (OFAC) of the U.S. Department of the Treasury has frozen the Delaware-based Heritage Trust fund as it belongs to Suleiman Kerimov, a member of the Federation Council of the Federal Assembly of Russia. As of the end of June 2022, Heritage Trust holds assets valued at over USD 1 billion. With this decision being issued, any transactions involving the trust funds’ assets (money or property) are prohibited.  

According to the U.S. Treasury, “this action follows an extensive enforcement investigation into Kerimov’s U.S. holdings by OFAC. These efforts revealed that Kerimov used a complex series of legal structures and front persons to obscure his interest in Heritage Trust, the funds of which first entered the U.S. financial system through two foreign Kerimov-controlled entities prior to the imposition of sanctions against him. The funds were subsequently invested in large public and private U.S. companies and managed by a series of U.S. investment firms and facilitators. Kerimov and his proxies used various layers of U.S. and non-U.S. shell companies to hold formal title to assets and to conduct transactions in a manner that concealed his interest.”

In this context, Treasury Secretary Janet L. Yellen said: “Treasury continues using the full range of our tools to expose and disrupt those who seek to evade our sanctions and hide their ill-gotten gains. Even as Russian elites hide behind proxies and complex legal arrangements, Treasury will use our broad enforcement authorities, as well as our partnerships through the REPO Task Force, to actively implement the multilaterally coordinated sanctions imposed on those who fund and benefit from Russia’s war against Ukraine.” 

AFFECTED COUNTRIES

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