Sanctions Watch

Roundup: May 15 - June 6, 2022

June 9, 2022

Russian sanctions expansion has slowed in recent weeks as the Administration continues to wrestle with a series of expiring general licenses for Russia. The buildout from the Administration on Russia sanctions may slow a little more, but may also result in significant action, likely in close coordination with the EU. The Democratic People’s Republic of Korea (DPRK or North Korea) sanctions effort will continue to expand, and the Venezuela sanctions regime will become increasingly a point of contention.  


In a speech in Warsaw, Poland, Treasury Secretary Janet Yellen noted the United States’ extensive and continuing use of sanctions, and Deputy Secretary Adeyemo warned foreign banks during a meeting in New York of the risks of helping Russia circumvent sanctions.  But reports have emerged regarding fissures within the Administration over sanctions policy, which could further slow the next round of sanctions.  

On June 2, the Administration designated a network surrounding Putin money-manager Sergei Roldugin, and a range of assets. The Administration announced on May 24 that it would let a license that allowed Russia to make interest and maturity payments on its sovereign debt to U.S. persons to lapse, already resulting in missed its bond obligations.  On June 6, Treasury released a Frequently Asked Question noting that transactions relating to the divestment of such instruments is permissible but that the purchase of new debt is not.  See Sanctions Watch on Russia’s General Licenses for more information.    

The same day as the Roldugin designations, Commerce added an additional 71 entities to its Entity list. On May 20, the Department of Commerce announced that it was banning Rossiya Airlines from receiving exports and re-exports from the U.S., and identifying an aircraft owned by Russian oligarch Roman Abramovich, who was issued a charging letter from Commerce on June 6th for the continued use of US-origin aircraft in violation of US export controls. This is part of a larger government-wide effort to take aim at Russia sanctions evasion, to include efforts to increase the penalties on companies that violate export control regulations (including higher fines and more frequent legal action) targeting sanctions evasion networks using private equity and hedge funds, and utilizing multilateral activities such as the US-EU Trade and Technology Council to coordinate responses to Russian export control violations. Also expect the Administration to continue to target networks with a Russian nexus. For example, on May 25, the Treasury designated an oil smuggling and money laundering network backed by Russia and led by Iran’s Islamic Revolutionary Guard Corps-Qods Force. 

Finally, Moscow expanded its list of Americans banned from entering Russia including every member of the U.S. House of Representatives.

North Korea

On May 27, both China and Russia vetoed a new UN Security Council resolution (UNSCR) imposing additional sanctions on North Korea for its continued testing of long-range nuclear-capable ballistic missiles, stating their preference for negotiations with the DPRK. On May 27 the administration also designated two Russian banks and other entities involved in the DPRK’s ballistic missile procurement networks, although there were criticisms regarding the inadequacy of the designation package. The Administration also issued an advisory regarding the DPRK’s practice of exporting IT and other high-skilled workers in violation of UN Security Council resolutions and US sanctions.  Finally, the administration has signaled its intent to bring another UNSCR to the UN Security Council imposing sanctions on North Korea if that government conducts a nuclear test. Expect an emphasis by the Administration to continue to focus on DPRK high-skilled workers and its use of cryptocurrency transactions as a means of sanctions evasion. It is also important to note that this was amongst the few times that Russia and China have exercised their veto over an UNSCR imposing sanctions on the DPRK. Expect the administration to increase the application of US sanctions and increase EU engagement on this issue.


On May 31, it was reported that the Department of Commerce is investigating Chinese companies for export sanctions violations. This will be an important space to watch as the administration was likely increasing its focus on Chinese entities before the Russian invasion of Ukraine, and may be trying to refocus again on China to the extent possible.    

Venezuela and Cuba

On May 25, the Administration reissued a license to Chevron to operate in U.S.-sanctioned Venezuela through the end of November under the same restricted terms granted to the company since 2020. There were early indications that this license would be expanded as Cuba sanctions were eased considerably by the Biden Administration. These measures have led to considerable friction between elements of the Congress and the administration over these actions. 

  • Treasury formally issued the 2022 National Strategy for Combatting Terrorist and Other Illicit Financing. The objectives of the strategy are to close legal and regulatory gaps in the U.S. AML/CFT framework that are exploited by illicit actors to anonymously access the U.S. financial system; continue to make the U.S. AML/CFT regulatory framework for financial institutions more efficient and effective; enhance the operational effectiveness of law enforcement and other U.S. government agencies in combating illicit finance; and enable the benefits of technological innovation while mitigating risks.

  • According to a May 25 speech by Under Secretary Brian Nelson, the Treasury is examining whether to apply additional rules in place for investment managers to combat money laundering and illicit financing, particularly related to Russia.


On May 19, the Senate passed a $40 billion supplemental bill by a vote of 86-11 for aid to Ukraine. The President signed the bill into law on May 21.  However, there was growing dissent within Republican ranks in both the House and Senate over additional funding for Ukraine.  It is increasingly likely that the Administration will make another request for supplemental funding towards the late summer or early fall.  It is unclear what role sanctions will play in this process.

On May 26, the Senate Foreign Relations Committee passed the following bills: H.R. 4250, War Crimes Rewards Expansion Act; H.R. 6089, Stop Iranian Drones Act, and H.R. 7276, Ukraine Invasion War Crimes Deterrence and Accountability Act. While these bills are not themselves significant, it demonstrates that that congress continues to pass smaller pieces of legislation that may have a cumulative effect. Also of note is that HR 6089 is one of the first bipartisan Iran sanctions bills to be passed out of the House and considered by a Senate committee since 2017.    

Congress will likely take additional votes on limited Russia sanctions measures, but a comprehensive Russia sanctions bill is unlikely in the near-term; a legislative sanctions push could emerge in the fall with the possibility of another supplemental request.

China and Iran could emerge as contentious sanctions-related issues in the near to medium term, with Venezuela and North Korea emerging as potential areas for both Administration and congressional movement.

On June 8, the National Defense Authorization Act (NDAA) process will begin. That legislation will likely be considered in the House in early July, with the Senate considering it towards the end of July or immediately after the August recess. Sanctions have historically been a part of this process, from Iran to Syria and narcotics. There may be efforts to include various sanctions-related initiatives in the NDAA again this year.