Sanctions Watch

Roundup: April 15 - May 1, 2022

May 3, 2022

Since April 15, Congress has taken a more prominent role in Russia sanctions, specifically tied to the Administration’s request for additional forfeiture authorities. There will be several sanctions-related votes this week in the Senate as part of the United States Innovation and Competition Act (USICA) conference process. 


On April 28, the Biden Administration announced that it was sending Congress a request to expand the range of measures available to enhance its asset forfeiture and criminal prosecution authorities for sanctions evasion. See the Spotlight on Russia Financial Sector Sanctions for more information. The Department of Justice (DOJ) has been active as well.  On April 14,  three Russians close to Vladimir Putin were indicted and charged with “conspiring to use an agent of Russia in the United States without prior notice to the Attorney General, conspiring to violate US sanctions, and conspiring to commit visa fraud.”  This effort fits with a reported expanded role of the DOJ in prioritizing the prosecution of sanctions evasion and export control violations related to sanctions imposed on Russia for its invasion of Ukraine.  

The Administration continued to increase the number of designations of Russian and Russia-related individuals and entities. On April 20, OFAC designated a sanctions evasion network to include Transkapitalbank, a Russian commercial bank. The Office of Foreign Assets Control (OFAC) also noted that this was the first time that a virtual currency mining company was designated. On April 21, the Bureau of Industry and Security (BIS) acted to deny export privileges to the Russian cargo carrier Aviastar.  Finally, the Financial Crimes Enforcement Network (FinCEN) issued an advisory to financial institutions on efforts to detect the proceeds of foreign public corruption, particularly as it related to Russia. 

North Korea

On April 19, the State Department’s Rewards for Justice Program announced that it is offering a $5 million reward for information that leads to the disruption of financial networks for those engaged in money laundering supporting North Korea, the exportation of luxury goods to North Korea, and cyber activities. This is largely in keeping with the Administration’s recent approach that includes gradually increasing the application of sanctions and other measures against North Korea. On April 14, OFAC updated its listing for Lazarus, the hacking group associated with North Korea, to include its Ethereum wallet, which was reportedly part of a $615 million heist. Finally, the UN Security Council North Korea sanctions coordinator is seeking additional measures by the US and other actors to protect unregulated areas, such as cryptocurrency, from North Korean proliferation finance networks. 


As noted in the April 1 – April 15 Sanctions Tracker,  the Administration had to ask Congress for additional resources for Ukraine.  Embedded in that supplemental proposal is a request for additional authorities noted above, to which Congress could attach additional sanctions measures. On April 27, the House passed HR 6930: Asset Seizure for Ukraine Reconstruction Act (permits the Administration to confiscate all property blocked by Treasury of designated entities associated with Russia); HR 7311, the Countering Malign Russian Activities in Africa Act; H.R. 7372, Protecting Semiconductor Supply Chains from Putin Act; H.R. 7314, AXIS Act (establishes an interagency Working Group on Semiconductor Supply Disruptions); HR 923, the Georgia Support Act; H.R. 3344, Transatlantic Telecommunications Security Act (establishes within the State Department an International Telecommunication Union Security Campaign Director);   

Also likely to come up soon are H.R. 7312, To prohibit participation of the Russian Federation in the G7 (prohibits the administration from using Federal funds to support or facilitate Russia’s participation in the G-7); H.R. 7340, To provide for congressional oversight of certain sanctions imposed with respect to the Russian Federation (provides the Congress the ability to formally nominate individuals and entities for sanctions designations under EO 14024);  and H.R. 7338, Russia Cryptocurrency Transparency Act (requires congressional notification of rewards paid using cryptocurrency by the administration, authorized the Secretary of State to appoint a Director of Digital Currency Security, and contains other reporting requirements).  

United States Innovation and Competition Act (USICA) Conference  

Last week, the Senate formalized the chamber’s conferees and reportedly reached an agreement on motions to instruct the conferees—non-binding political votes—to allow Senate leadership to formally appoint conferees.  The Senate Democrat and Republican leadership have arranged for sanctions-related votes on the following this week: 

  • Rubio MTI (Intel Review)–Requires an Intel Review to ensure national security protections are in place to prohibit misappropriation and theft of federal resources. 
  • Lankford MTI (Iran).  Requires any deal with Iran address Iran’s development of nuclear weapons, and other destabilizing activities, and prohibits lifting sanctions on the IRGC or removing their designation as a foreign terrorist organization. 
  • Cruz MTI (Iran)–Requires a report identifying links between China and Iran and to limit cooperation through terrorism-related sanctions imposed on the Central Bank of Iran and the IRGC. 
  • Sullivan MTI (Critical Minerals)–Prohibits the purchasing of materials, technology, or critical minerals mined, produced, processed, or refined in China or Russia. 
  • SFRC/Risch MTI (China’s Malign Influence)–Include provisions that take actionable steps to counter malign or undue influence and activities in the U.S. and abroad by China.
  • Blackburn MTI (Digital Yuan)–Requires OMB to develop strict guidance for executive agencies requiring adequate security measures for any transfer, storage, or use of digital yuan on information technology.  

The USICA MTIs should serve as a guide for the type of measures that may be offered as amendments to future pieces of must-pass legislation.  Also, with the Administration’s supplemental and authorities request, Congress may seek to add additional sanctions-related measures to any such vehicle.  They could include additional measures imposed on the Central Bank of Russia, such as targeting their card payment system Mir, and their specialized messaging service, System for the Transfer of Financial Messages. They may also try to include additional oversight measures.