Media Coverage
Source: Compliance Week
Media Coverage
Press Contacts: Erik Cummins, Matt Hyams, Olivia Thomas
03.16.22
Coordinated sanctions responses of the United States, UK, EU and other countries have crippled Russia’s economy as a consequence of President Vladimir Putin’s invasion of Ukraine on February 24. The list of international companies pulling their businesses out of Russia continues to lengthen each day, and risks to remaining banks continue to increase.
“The coordination of sanctions has been effective and really unprecedented,” Pillsbury International Trade partner Aaron Hutman told Compliance Week. “Usually, it’s much more fractured.” Further, he noted that “governments are issuing new rules every day. But sanctions are not the only factor, and banks likely are leaving Russia in part for the same reason McDonald’s is leaving Russia: They don’t want to be perceived as contributing to a war.”
Moving money into unsanctioned foreign and Russian banks by ordinary Russians, among others, has been identified as a financial trend, and the banks must actively prepare for potential money laundering.
Hutman added: “There is an enhanced risk that legitimate assets, as well as crony and corruption money, will be brought to unsanctioned banks. Banks will have to be very careful about taking on new clients in Russia and in watching for unusual activity that might indicate an existing client is acting for a hidden party.”
Likewise, Hutman said, “If you’re hosting a (digital asset) wallet or in the cryptocurrency ecosystem, your regulators expect you to be on high alert right now.”
Read the full article here.