OFAC designates Russian financial institution for sanctions evasion

The US Department of the Treasury’s Office of Foreign Assets Control (‘OFAC’) said on 19 June that it had designated a Russian entity, which had ‘assisted North Korea in evading sanctions to access the international financial system’.

OFAC said that the action targeted the organisation, Russian Financial Society, ‘pursuant to Executive Order (E.O.) 13382 for having provided, or attempted to provide, financial, material, technological, or other support for, or goods or services in support of, U.S.-designated Dandong Zhongsheng Industry & Trade Co. Ltd (Dandong Zhongsheng), an entity that is owned and controlled by, directly or indirectly, U.S.- and United Nations (UN)-designated Foreign Trade Bank (FTB), North Korea’s primary foreign exchange bank.’

OFAC said that Russian Financial Society began to provide financial services to North Korea ‘… immediately upon attaining their non-banking credit organization license, which allows Russian Financial Society to transact in multiple foreign currencies. Russian Financial Society provided bank accounts for OFAC-designated Dandong Zhongsheng and to a North Korean chief representative of Korea Zinc Industrial Group, which was also designated for operating in the mining industry in the North Korean economy and for having sold, supplied, or transferred zinc from North Korea, where revenue or goods received may benefit the Government of North Korea.’

It said that Dandong Zhongsheng had been designated by the United States ‘for being owned or controlled by, directly or indirectly, FTB, an entity whose property and interests are blocked pursuant to E.O. 13382. Han Jang Su, FTB’s chief representative in Moscow, played a key part in acquiring banking services from Russian Financial Society. Han Jang Su was designated by the United States on March 31, 2017, for acting for or on behalf of, directly or indirectly, FTB. Both Han Jang Su and FTB have also been designated by the UN Security Council Committee pursuant to Resolution 1718 (2006).’

See:
https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20190619.aspx