U.S. Sanctions Crypto Money Launderer for Russian Oligarchs

U.S. targets crypto-focused money laundering and sanction evasion by Russian oligarchs and ransomware actors.

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  • The U.S. Treasury has designated a “crypto exchange” services provider for Russian oligarchs.
  • The designated individual is believed to have helped cybercriminals launder ransomware payments.
  • The U.S. imposed a range of sanctions on the individual.

The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has sanctioned a Russian businesswoman for her alleged role in laundering and moving funds through crypto on behalf of Russian elites and ransomware actors.  

In a press release dated November 3, OFAC announced wide-ranging sanctions on Ekaterina Zhdanova, accusing her of leveraging entities that lack Anti-Money Laundering/Combatting the Financing of Terrorism (AML/CFT) controls to assist her clients in obfuscating their source of wealth.

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A “Crypto Exchange” for Russian Oligarchs and Cybercriminals  

As OFAC alleges, Zhdanova conducts multimillion-dollar crypto transfers for Russian oligarchs who have relocated overseas.

Notably, the Treasury said that at some point, the businesswoman moved over $100 million in wealth on behalf of Russian oligarchs to the United Arab Emirates and facilitated tax residency services.

Through these services, Zhdanova allegedly helped her clients secure United Arab Emirates identification cards and open bank accounts in the country.

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“Payments were alleged to be made in cash or by virtual currency, and to be received at a Dubai bank account, and then transferred from the Dubai bank account to foreign bank accounts at the discretion of the client,” the statement read.

Other beneficiaries of Zhdanova’s crypto exchange services include cybercriminals affiliated with the Russian Ryuk ransomware group. The Treasury noted that in 2021, the businesswoman laundered over $2.3 million of suspected victim payments on behalf of the group.

Based on these allegations, the Treasury has designated Zhdanova as a crypto money launderer for Russian elites and cybercriminals, imposing wide-ranging sanctions on her.

Sanctions Implications

As a result of today’s designation, the Treasury has blocked all Zhdanova property and interests in property in the U.S. and ordered that they be reported to OFAC.

Further, per the G7’s commitment to crack down on sanctions evasion by the Russian elite, the Treasury warned that financial institutions or entities that engage in transactions with Zhdanova shall be “subject to an enforcement action.”

Read how SBF’s guilty verdict has bolstered crime crackdown in crypto:
Prosecutors Bolster Crime Crackdown Post-SBF Guilty Verdict

Stay updated on the latest crypto seizure by the DOJ:
DOJ Seizes $54M Ether from Narcotics Distribution Scheme

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Brian Danga

Brian Danga, a Kenyan crypto reporter, is dedicated to delivering breaking news and updates from the cryptocurrency world. With a background as a Web3 writer and project manager, he recognizes the importance of unbiased reporting. Holding an LLB degree from the University of Nairobi, Brian's analytical skills contribute to his accurate news reporting. His personal interests include cooking, watching documentaries, reading, and engaging in intellectual discussions.