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When OFAC issues an update this early, you post it early

This morning, OFAC placed the following person:

DMITRIEV, Kirill Aleksandrovich (Cyrillic: ДМИТРИЕВ, Кирилл Александрович) (a.k.a. DMITRIYEV, Kirill), Moscow, Russia; DOB 12 Apr 1975; POB Kyiv, Ukraine; nationality Russia; Gender Male; Tax ID No. 773013083324 (Russia) (individual) [RUSSIA-EO14024].

and entities:

JOINT STOCK COMPANY MANAGEMENT COMPANY OF THE RUSSIAN DIRECT INVESTMENT FUND (Cyrillic: АКЦИОНЕРНОЕ ОБЩЕСТВО УПРАВЛЯЮЩАЯ КОМПАНИЯ РОССИЙСКОГО ФОНДА ПРЯМЫХ ИНВЕСТИЦИЙ) (a.k.a. AKTSIONERNOE OBSHCHESTVO UPRAVLYAYUSHCHAYA KOMPANIYA ROSSISKOGO FONDA PRYAMYKH INVESTITSI; a.k.a. AKTSIONERNOYE OBSHCHESTVO UPRAVLYAYUSHCHAYA KOMPANIYA ROSSIYSKOGO FONDA PRYAMYKH INVESTITSIY; f.k.a. LIMITED LIABILITY COMPANY MANAGEMENT COMPANY OF RDIF; f.k.a. OBSHCHESTVO S OGRANICHENNOY OTVETSTVENNOSTYU UPRAVLYAYUSHCHAYA KOMPANIYA RFPI (Cyrillic: ОБЩЕСТВО С ОГРАНИЧЕННОЙ ОТВЕТСТВЕННОСТЬЮ); a.k.a. "AO UK RFPI" (Cyrillic: "АО УК РФПИ"); a.k.a. "JSC MC RDIF"), Naberezhnaya Presnenskaya, Dom 8 Stroyeniye 1, Etaj 7, Moscow 123112, Russia (Cyrillic: Набережная Пресненская, Дом 8, Строение 1, Этаж 7, Москва 123112, Russia); Website www.rdif.ru; alt. Website www.investinrussia.com; Organization Established Date 11 Apr 2017; Organization Type: Trusts, funds and similar financial entities; Target Type Financial Institution; alt. Target Type State-Owned Enterprise; Tax ID No. 7703425673 (Russia); Government Gazette Number 15110384 (Russia); Registration Number 1177746367017 (Russia) [RUSSIA-EO14024].

LIMITED LIABILITY COMPANY RVC MANAGEMENT COMPANY (Cyrillic: ОБЩЕСТВО С ОГРАНИЧЕННОЙ ОТВЕТСТВЕННОСТЬЮ УПРАВЛЯЮЩАЯ КОМПАНИЯ РВК) (a.k.a. OBSHCHESTVO S OGRANICHENNOY OTVETSTVENNOSTYU UPRAVLYAYUSHCHAYA KOMPANIYA RVK; a.k.a. RUSSIAN VENTURE COMPANY (Cyrillic: РОССИЙСКАЯ ВЕНЧУРНАЯ КОМПАНИЯ); a.k.a. RVC MANAGEMENT COMPANY LLC; a.k.a. "LLC MC RVC"; a.k.a. "LLC UK RVK"; a.k.a. "OOO UK RVK" (Cyrillic: "ООО УК РВК")), D. 8, Str. 1, Etaj 12, Nab. Presnenskaya, Moscow 123112, Russia (Cyrillic: Дом 8, Строение 1 Этаж 12, Набережная Пресненская, Москва 123112, Russia); Website https://rvc.ru; Organization Established Date 30 Dec 2020; Organization Type: Trusts, funds and similar financial entities; Target Type Financial Institution; alt. Target Type State-Owned Enterprise; Tax ID No. 9703024347 (Russia); Government Gazette Number 33185693 (Russia); Registration Number 1207700502547 (Russia) [RUSSIA-EO14024] (Linked To: JOINT STOCK COMPANY MANAGEMENT COMPANY OF THE RUSSIAN DIRECT INVESTMENT FUND).

RUSSIAN DIRECT INVESTMENT FUND (Cyrillic: РОССИЙСКИЙ ФОНД ПРЯМЫХ ИНВЕСТИЦИЙ) (a.k.a. "RDIF" (Cyrillic: "РФПИ")), Presnenskaya nab., D. 8, Structure 1, MFK Capital City, South Tower, 7, 8th Floor, Moscow 123112, Russia (Cyrillic: Пресненская наб., д. 8, стр. 1 МФК Город Столиц, Южная башня, 7, 8 этаж, Москва 123112, Russia); Website www.rdif.ru; alt. Website www.investinrussia.com; Organization Established Date 01 Jun 2011; Target Type Government Entity [RUSSIA-EO14024].

on the SDN List under the Russian Harmful Foreign Activities program. It also updated the following existing Non-SDN Menu-Based Sanctions List (NS-MBS) listings:

CENTRAL BANK OF THE RUSSIAN FEDERATION (Cyrillic: ЦЕНТРАЛЬНЫЙ БАНК РОССИЙСКОЙ ФЕДЕРАЦИИ) (a.k.a. BANK OF RUSSIA; a.k.a. BANK OF RUSSIA, CENTRAL BANK; a.k.a. BANK ROSSI, FEDERAL STATE BUDGETARY INSTITUTION; a.k.a. CENTRAL BANK OF RUSSIA; a.k.a. TSENTRALNY BANK ROSSISKOI FEDERATSII), Neglinnaya St 12, Moscow 107016, Russia; Moscow, Russia; SWIFT/BIC CBRFRUMM; Website www.cbr.ru; Organization Established Date 13 Jul 1990; Organization Type: Central banking; Target Type Government Entity; Executive Order 14024 Directive Information - For more information on directives, please visit the following link: https://home.treasury.gov/policy-issues/financial-sanctions/sanctions-programs-and-country-information/russian-harmful-foreign-activities-sanctions#directives; Executive Order 14024 Directive Information Subject to Directive 1a - As of the effective date, participation in the secondary market for ruble or non-ruble denominated bonds issued on or after the effective date by the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation is prohibited.; Listing Date (EO 14024 Directive 1a): 22 Feb 2022; Effective Date (EO 14024 Directive 1a): 01 Mar 2022; Tax ID No. 7702235133 (Russia); Government Gazette Number 00032253 (Russia); Registration Number 1037700013020 (Russia) [RUSSIA-EO14024]. -to- CENTRAL BANK OF THE RUSSIAN FEDERATION (Cyrillic: ЦЕНТРАЛЬНЫЙ БАНК РОССИЙСКОЙ ФЕДЕРАЦИИ) (a.k.a. BANK OF RUSSIA; a.k.a. BANK OF RUSSIA, CENTRAL BANK; a.k.a. BANK ROSSI, FEDERAL STATE BUDGETARY INSTITUTION; a.k.a. CENTRAL BANK OF RUSSIA; a.k.a. TSENTRALNY BANK ROSSISKOI FEDERATSII), Neglinnaya St 12, Moscow 107016, Russia; Moscow, Russia; SWIFT/BIC CBRFRUMM; Website www.cbr.ru; Organization Established Date 13 Jul 1990; Organization Type: Central banking; Target Type Government Entity; Executive Order 14024 Directive Information - For more information on directives, please visit the following link: https://home.treasury.gov/policy-issues/financial-sanctions/sanctions-programs-and-country-information/russian-harmful-foreign-activities-sanctions#directives; Executive Order 14024 Directive Information Subject to Directive 1a - As of the effective date, participation in the secondary market for ruble or non-ruble denominated bonds issued on or after the effective date by the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation is prohibited.; alt. Executive Order 14024 Directive Information Subject to Directive 4 - any transaction involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation, including any transfer of assets to such entities or any foreign exchange transaction for or on behalf of such entities is prohibited.; Listing Date (EO 14024 Directive 1a): 22 Feb 2022; Effective Date (EO 14024 Directive 1a): 01 Mar 2022; Tax ID No. 7702235133 (Russia); Government Gazette Number 00032253 (Russia); Registration Number 1037700013020 (Russia) [RUSSIA-EO14024]. 

MINISTRY OF FINANCE OF THE RUSSIAN FEDERATION (Cyrillic: МИНИСТЕРСТВО ФИНАНСОВ РОССИЙСКОЙ ФЕДЕРАЦИИ), 9 Ilyinka Street, Moscow 109097, Russia (Cyrillic: ул. Ильинка, 9, Москва 109097, Russia); Target Type Government Entity; Executive Order 14024 Directive Information - For more information on directives, please visit the following link: https://home.treasury.gov/policy-issues/financial-sanctions/sanctions-programs-and-country-information/russian-harmful-foreign-activities-sanctions#directives; Executive Order 14024 Directive Information Subject to Directive 1a - As of the effective date, participation in the secondary market for ruble or non-ruble denominated bonds issued on or after the effective date by the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation is prohibited.; Listing Date (EO 14024 Directive 1a): 22 Feb 2022; Effective Date (EO 14024 Directive 1a): 01 Mar 2022 [RUSSIA-EO14024]. -to- MINISTRY OF FINANCE OF THE RUSSIAN FEDERATION (Cyrillic: МИНИСТЕРСТВО ФИНАНСОВ РОССИЙСКОЙ ФЕДЕРАЦИИ), 9 Ilyinka Street, Moscow 109097, Russia (Cyrillic: ул. Ильинка, 9, Москва 109097, Russia); Target Type Government Entity; Executive Order 14024 Directive Information - For more information on directives, please visit the following link: https://home.treasury.gov/policy-issues/financial-sanctions/sanctions-programs-and-country-information/russian-harmful-foreign-activities-sanctions#directives; Executive Order 14024 Directive Information Subject to Directive 1a - As of the effective date, participation in the secondary market for ruble or non-ruble denominated bonds issued on or after the effective date by the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation is prohibited.; alt. Executive Order 14024 Directive Information Subject to Directive 4 - any transaction involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation, including any transfer of assets to such entities or any foreign exchange transaction for or on behalf of such entities is prohibited.; Listing Date (EO 14024 Directive 1a): 22 Feb 2022; Effective Date (EO 14024 Directive 1a): 01 Mar 2022 [RUSSIA-EO14024].

NATIONAL WEALTH FUND OF THE RUSSIAN FEDERATION (Cyrillic: ФОНД НАЦИОНАЛЬНОГО БЛАГОСОСТОЯНИЯ), 9 Ilyinka Street, Moscow 109097, Russia (Cyrillic: ул. Ильинка, 9, Москва 109097, Russia); Target Type Government Entity; Executive Order 14024 Directive Information - For more information on directives, please visit the following link: https://home.treasury.gov/policy-issues/financial-sanctions/sanctions-programs-and-country-information/russian-harmful-foreign-activities-sanctions#directives; Executive Order 14024 Directive Information Subject to Directive 1a - As of the effective date, participation in the secondary market for ruble or non-ruble denominated bonds issued on or after the effective date by the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation is prohibited.; Listing Date (EO 14024 Directive 1a): 22 Feb 2022; Effective Date (EO 14024 Directive 1a): 01 Mar 2022 [RUSSIA-EO14024]. -to- NATIONAL WEALTH FUND OF THE RUSSIAN FEDERATION (Cyrillic: ФОНД НАЦИОНАЛЬНОГО БЛАГОСОСТОЯНИЯ), 9 Ilyinka Street, Moscow 109097, Russia (Cyrillic: ул. Ильинка, 9, Москва 109097, Russia); Target Type Government Entity; Executive Order 14024 Directive Information - For more information on directives, please visit the following link: https://home.treasury.gov/policy-issues/financial-sanctions/sanctions-programs-and-country-information/russian-harmful-foreign-activities-sanctions#directives; Executive Order 14024 Directive Information Subject to Directive 1a - As of the effective date, participation in the secondary market for ruble or non-ruble denominated bonds issued on or after the effective date by the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation is prohibited.; alt. Executive Order 14024 Directive Information Subject to Directive 4 - any transaction involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation, including any transfer of assets to such entities or any foreign exchange transaction for or on behalf of such entities is prohibited.; Listing Date (EO 14024 Directive 1a): 22 Feb 2022; Effective Date (EO 14024 Directive 1a): 01 Mar 2022 [RUSSIA-EO14024].

There is a new Executive Order 14024 Directive, which says, in part:

Pursuant to sections 1(a)(iv), 1(d), and 8 of Executive Order 14024, “Blocking Property With Respect To Specified Harmful Foreign Activities of the Government of the Russian Federation” (the “Order”), the Director of the Office of Foreign Assets Control has determined, in consultation with the Department of State, that the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation are political subdivisions, agencies, or instrumentalities of the Government of the Russian Federation, and that the following activities by a United States person are prohibited, except to the extent provided by law, or unless licensed or otherwise authorized by the Office of Foreign Assets Control:

any transaction involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation, including any transfer of assets to such entities or any foreign exchange transaction for or on behalf of such entities.

and a new General License 8A, which adds the Central Bank of the Russian Federation to the old GL 8:

(a) Except as provided in paragraph (c) of this general license, all transactions prohibited by Executive Order (E.O.) 14024 involving one or more of the following entities that are related to energy are authorized, through 12:01 a.m. eastern daylight time, June 24, 2022:

(1) State Corporation Bank for Development and Foreign Economic Affairs Vnesheconombank;

(2) Public Joint Stock Company Bank Financial Corporation Otkritie;

(3) Sovcombank Open Joint Stock Company;

(4) Public Joint Stock Company Sberbank of Russia;

(5) VTB Bank Public Joint Stock Company;

(6) Any entity in which one or more of the above persons own, directly or indirectly, individually or in the aggregate, a 50 percent or greater interest; or

(7) the Central Bank of the Russian Federation.

The list of what is not authorized has also been updated – subclasses 1 and 3 are new:

(c) This general license does not authorize:

(1) Any transactions prohibited by Directive 1A under E.O. 14024, Prohibitions Related to Certain Sovereign Debt of the Russian Federation;

(2) The opening or maintaining of a correspondent account or payable-through account for or on behalf of any entity subject to Directive 2 under E.O. 14024, Prohibitions Related to Correspondent or Payable-Through Accounts and Processing of Transactions Involving Certain Foreign Financial Institutions;

(3) Any debit to an account on the books of a U.S. financial institution of the Central Bank of the Russian Federation; or

(4) Any transactions involving any person blocked pursuant to E.O. 14024 other than the blocked persons described in paragraph (a) of this general license, unless separately authorized.

And Treasury issued the following press release:

PRESS RELEASES

Treasury Prohibits Transactions with Central Bank of Russia and Imposes Sanctions on Key Sources of Russia’s Wealth

February 28, 2022

In Coordination with Allies and Partners, Treasury Actions Restrict Access to Billions in Central Bank Assets and Sovereign Wealth Fund 

Treasury Sanctions Russian Direct Investment Fund – A Symbol of Russian Kleptocracy

United States and its Partners and Allies Continue to Hold the Government of the Russian Federation Accountable for its Premeditated and Unprovoked Invasion of Ukraine

WASHINGTON – Today, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) prohibited United States persons from engaging in transactions with the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation. This action effectively immobilizes any assets of the Central Bank of the Russian Federation held in the United States or by U.S. persons, wherever located.

In addition, as directed by President Biden last week, OFAC sanctioned a key Russian sovereign wealth fund, the Russian Direct Investment Fund (RDIF), with exposure to the United States financial system and its Chief Executive Officer (CEO), Kirill Dmitriev – a known Putin ally. Recently designated Russian President Vladimir Putin and his inner circle of cronies have long relied on RDIF and Dmitriev to raise funds abroad, including in the United States. By further restricting these persons and entities from the U.S. financial system, the United States continues to demonstrate its unwavering commitment to support Ukraine, impose costs on Putin’s inner circle or those connected to Putin and his war of choice, and to prevent Putin’s regime from raising capital to fund its invasion of Ukraine and other priorities.

The United States has not taken this action alone. On February 26, 2022, partners and allies committed to imposing restrictive measures that will prevent the Central Bank of the Russian Federation from deploying its international reserves in ways that would undermine the impact of United States sanctions and the European Union followed up with their restrictions last night. Our actions demonstrate global support for Ukraine and the commitment to hold Russia’s threatening, authoritarian rulers responsible for their heinous actions.

“The unprecedented action we are taking today will significantly limit Russia’s ability to use assets to finance its destabilizing activities, and target the funds Putin and his inner circle depend on to enable his invasion of Ukraine,” said Secretary of the Treasury Janet L. Yellen. “Today, in coordination with partners and allies, we are following through on key commitments to restrict Russia’s access to these valuable resources.”

Today’s actions were taken pursuant to Executive Order (E.O.) 14024, which authorizes sanctions against Russia for its harmful foreign activities, including violating well-established principles of international law, such as respect for the sovereignty and territorial integrity of other states.

RESTRICTING RUSSIA’S ABILITY TO FINANCIALLY SUSTAIN ITS WAR 

Today, OFAC issued new Directive 4 under E.O. 14024, “Prohibitions Related to Transactions Involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation” (Russia-related Sovereign Transactions Directive).  Pursuant to the Russia-related Sovereign Transactions Directive, United States persons are prohibited from engaging in any transaction involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation.

This action follows through on partners’ and allies’ commitment made on February 26 to impose restrictive measures to prevent the Central Bank of the Russian Federation from deploying its international reserves in a way that would undermine the impact of U.S. sanctions.  

The Russia-related Sovereign Transactions Directive will disrupt Russia’s attempts to prop up its rapidly depreciating currency by restricting global supplies of the ruble and access to reserves that Russia may try to exchange to support the ruble.  

Contemporaneously with the issuance of this directive, OFAC is issuing a general license to authorize certain energy-related transactions with the Central Bank of the Russian Federation and will follow with other authorizations and guidance as needed.

TARGETING RUSSIAN DIRECT INVESTMENT FUND

OFAC also designated three entities critical to managing one of Russia’s key sovereign wealth funds:  Russian Direct Investment Fund (RDIF), its management company, and one of the managing company’s subsidiaries.  By blocking these entities, OFAC is terminating yet another route through which Russia has benefitted from access to the U.S. financial system. 
 
The Russian Direct Investment Fund (RDIF) was created in 2011 by order of then-President of Russia, Dmitry Medvedev, and then Prime Minister of Russia, Vladimir Putin. RDIF operates in a number of industries, such as insurance and financial services. One of the purposes behind RDIF’s creation was to develop relationships with international investors for direct investment in Russia. While officially a sovereign wealth fund, RDIF is widely considered a slush fund for President Vladimir Putin and is emblematic of Russia’s broader kleptocracy.

OFAC designated RDIF pursuant to E.O. 14024 for being owned or controlled by, or for acting or purporting to act for or on behalf of, directly or indirectly, the Government of Russia (GoR). RDIF was also sanctioned by Canada on February 24, 2022. 

Joint Stock Company Management Company of the Russian Direct Investment Fund (JSC RDIF) is RDIF’s management company. In response to Russia’s 2014 unprovoked attack on Ukraine, OFAC issued debt and equity restrictions in 2015 on JSC RDIF’s predecessor, the Russian Direct Investment Fund Management Company, pursuant to Directive 1 under E.O. 13662. Today’s action expands the sanctions on this entity, which is now blocked.

OFAC designated JSC RDIF pursuant to E.O. 14024 for being owned or controlled by, or for acting or purporting to act for or on behalf of, directly or indirectly, the GoR, and for operating or having operated in the financial services sector of the Russian Federation economy. 

Limited Liability Company RVC Management Company (LLC RVC) is a subsidiary of JSC RDIF. LLC RVC is a company that operates in deposit banking, management of investment funds, unit investment trusts, insurance, and private pension funds.

OFAC designated LLC RVC RDIF pursuant to E.O. 14024 for being owned or controlled by, or for acting or purporting to act for or on behalf of, directly or indirectly, JSC RDIF, and for operating or having operated in the financial services sector of the Russian Federation economy. 

KIRILL DMITRIEV 

Kirill Aleksandrovich Dmitriev (Dmitriev) is a close ally of Putin and the CEO of RDIF and JSC RDIF. Dmitriev is an alumnus of American universities and has links to American consulting and financial services firms. He has leveraged his ties to universities and organizations in the United States to serve as a representative for the Russian president to American institutions, thereby providing access to key economic opportunities in the United States.  

Among the Russian elite, Dmitriev is a close associate of Putin and he and his wife are also believed to be close to one of Putin’s daughters, Katerina Tikhonova, and her former husband, billionaire Kirill Shamalov. Shamalov was designated in April 2018 pursuant to E.O. 13662 for operating in the energy sector of the Russian Federation economy.

OFAC designated Dmitriev pursuant to E.O. 14024 for being or having been a leader, official, senior executive officer, or member of the board of directors of the GoR. Dmitriev was also sanctioned by Canada on February 24, 2022.

Links:

OFAC Notice

Russia-related Directive 4

Russia-related General License 8A

Treasury Press Release

Categories: Licenses Non-SDN Menu-Based Sanctions (NS-MBS) List OFAC Updates Russian Harmful Foreign Activities Sanctions Sanctions Lists

eric9to5

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