The US Department of the Treasury announced new measures today targeting an elaborate sanctions evasion network between Russia and China, marking a significant escalation in efforts to restrict Russia’s access to international financial systems and sensitive technologies.
At the center of the crackdown is a newly-discovered network of “regional clearing platforms” (RCPs) operating in both countries, designed to facilitate cross-border payments for sensitive goods while evading international sanctions. The Treasury identified 15 companies and one individual involved in the scheme, including six Russian entities and nine Chinese firms. The action also demonstrates the US government’s growing concern about China’s role in supporting Russia’s military-industrial complex despite international sanctions.
“Today’s actions frustrate the Kremlin’s ability to circumvent our sanctions and get access to the goods they need to build weapons for their war of choice in Ukraine,” said Deputy Secretary of the Treasury Wally Adeyemo.
“Today’s expansion of mandatory secondary sanctions will reduce Russia’s access to revenue and goods.”
The Treasury’s action also designated Kyrgyzstan-based OJSC Keremet Bank for its role in coordinating with Russian officials and Promsvyazbank, a previously sanctioned Russian bank, to implement sanctions evasion schemes. The Kyrgyz bank was reportedly sold to interests connected to a Russian oligarch in 2024, with the apparent intention of creating a sanctions evasion hub.
In a parallel move, the Treasury re-designated nearly 100 Russian entities under Executive Order 13662, significantly expanding the scope of secondary sanctions. This means that foreign persons and financial institutions conducting significant transactions with these entities could face mandatory US sanctions, effectively increasing the isolation of Russia’s financial services, energy, and defense sectors.
The State Department complemented Treasury’s actions by sanctioning more than 150 additional entities and individuals, with a particular focus on Russia’s defense industry and its international support network. The measures specifically target Chinese companies, which the Treasury identified as “the largest supplier of dual-use items and enabler of sanctions evasion in support of Russia’s war effort.”
Major Russian financial institutions implicated in the clearing platform scheme include Sberbank, Alfa-Bank, Sovcombank, T-Bank, and Bank Tochka, all of which were previously designated under US sanctions.
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