New Round of Sanctions Targets Russian Government Officials and Business Entities

Last week, the Office of Foreign Asset Control of the U.S. Department of the Treasury (“Treasury”) added seven high-ranking Russian government officials and 17 Russian business entities to the Specially Designated National and Blocked Person List (“SDN List”) pursuant to authorization granted by Executive Order 13661, the details of which we discussed previously.  Treasury stated in a press release that Russia has refused to “take concrete steps to deescalate the situation in Ukraine” and has taken “illegitimate and unlawful actions” to destabilize Ukraine.

Any assets of the individuals and entities added to the SDN List that are within U.S. jurisdiction must be frozen.  Any transactions by U.S. persons or within the United States involving the individuals and entities added to the SDN List are prohibited without a license or license exception issued by OFAC.

With Russian troops massing on Russia’s border with Ukraine, the continued occupation of Crimea, and escalating violence between the separatist pro-Russian forces and the Government of Ukraine, Treasury stated the latest round of sanctions is aimed at imposing “increasing costs on Russia” and “will hold Russia accountable for its provocative actions.”

In a recent speech given before his meeting with foreign minister of the Democratic Republic of Congo, U.S. Secretary of State John Kerry stated that Russia should withdraw its support for the separatist or face “the reality of sector sanctions.”  As discussed previously, the Treasury has the authority pursuant to Executive Order 13662 to impose sanctions on “key sectors” of the Russian economy, such as financial services, energy, metals and mining, engineering, and defense and related material.

We will continue to follow events regarding Treasury’s Ukraine-related sanctions and how they impact the insurance industry here at www.InsureReinsure.com. 

For more insight and information on U.S. sanctions as they relate to the insurance industry, please consider attending the Edwards Wildman 13th Annual Half-Day Insurance and Reinsurance Seminar on June 5, 2014 at the New York offices of Edwards Wildman located at 750 Lexington Avenue, 8th Floor.  The CLE will contain a panel discussion regarding recent developments with U.S. Sanctions and compliance for insurance companies.  Reservations in advance are required.  For more information, please click here.