The Office of Foreign Assets Control (OFAC) of the US Treasury Department, which deals with planning and applying economic sanctions, issued a warning: “Russian Attempts to Evade Sanctions Using New Overseas Branches and Subsidiaries“.
This warning refers to Russia’s efforts to bypass sanctions by establishing new branches and subsidiaries in foreign countries. OFAC believes that foreign regulators and financial institutions should be cautious about establishing new branches or subsidiaries with Russian financial institutions, or engaging in any transactions with them. This includes new branches or subsidiary companies of Russian financial entities that are not subject to sanctions themselves.
Any foreign financial institution that deals with these branches or subsidiaries should be aware of potential sanctions risks, according to OFAC.
