The US focuses on Russia's Sanctions Evasion
Biden's administration is working to make sanctions against Russia more effective by explicitly warning Russian trading partner that they face legal risks doing business in the banned areas.
U.S. Brian NelsonAs part of a regional tour that also included Dubai, Brian Nelson, U.S. Undersecretary of Treasury for Terrorism and Financial Intelligence, met recently with representatives from the Turkish government and the banking sector to discuss how U.S. sanctions against Russia affect Turkish businesses.
Nelson stated that Turkish banks and businesses could be sanctioned if they engage with sanctioned Russian entities. He also warned of the possibility of losing access to G7 markets. His remarks were also published online.
Nelson spoke out about the increase in Turkey's exports last year to Russia and urged companies not to forget dual-use technology transfers, which could be used by Russia's military-industrial complex.
This warning was issued a week after U.S. Treasury's Office of Foreign Assets Control, also known as OFAC, had targeted the Russian private military company Wagner Group and other entities that were believed to be supporting the Russian military complex.
Last week's designation included Aviacon Zitotrans a Russian cargo airline that sought to use a Turkish company as well as Turkish diplomats to facilitate the sale and purchase of Russian defense equipment overseas.
Brian O'Toole was a senior advisor to the director OFAC during previous administrations. He played a key role in the design of the sanctions regime as a response to Russia's aggression against Ukraine. He stated that Treasury seems to be clearly indicating that it is now focusing on Russia's banned exports, particularly semiconductor exports. He said that Treasury may have other interests in Turkey." Military is the top priority. Two is Russian oligarchs, and elites using Turkey to secure assets after they have been sanctioned elsewhere. The third component is the backfill component. Turkey should not profit from the West's withdrawal." Ankara, which has previously condemned Russia's invasion and stated that it fully supports the territorial integrity Ukraine, has also said that it will not allow international sanctions to be bypassed.
However, Nelson, a U.S. Treasury official, told Turkish bankers that Russian Oligarchs had continued to purchase property and yachts in Turkey. He recommended that due diligence be increased beyond the U.S. sanctions.
According to studies of Russia's economy, this year's results show that although sanctions have pushed up prices and made certain high-tech equipment more difficult to find, importers have discovered new ways to get banned equipment into Russia through third countries.
Based on trade data, a Wall Street Journal investigative report shows that more than a dozen Turkish firms exported plastics, rubber products and transport vehicles last year. These items were then purchased by 10 Russian companies on U.S. sanction list.