Three agencies are pushing for a push amid concerns that imports from Turkey and UAE could fuel war in Ukraine
As western allies believe Turkey, the UAE and other countries in central Asia and Central Asia are weak links in their attempts to isolate Russia economically and militarily, the US Treasury, Commerce, and Justice Departments push the matter.
Matthew Axelrod (assistant secretary of commerce for export enforcement) stated in a statement that those who try to prop up Putin’s warmachine by evading export controls and sanctions would be held responsible.
Assistant Treasury secretary for terrorist funding and financial crime, Elizabeth Rosenberg, stated on Thursday that the UAE was “country of concern” for the US.
Rosenberg stated that UAE companies exported goods worth more than $18 million to “US-designated Russian entities”, between July 2022 and November 2022. She said that $5mn was of “US-origin and US-export controlled goods” to Russia, including “semiconductor device”, some of which could be used on the battlefield.
She stated that these types of figures were the foundation for our engagements with the private sector to clarify the consequences of violating export controls and sanctions, discuss high-risk activities, and take action when necessary.
The three US agencies issued a compliance note on the use of third-party intermediaries and transshipment points in an effort to evade Russian and Belarusian-related export controls and sanctions.
This list includes “red flags”, which businesses should look out for when it comes to potential sanctions evasion. It identifies specific countries such as China, Armenia and Turkey that are said to be used as “transshipment point” to illegally redirect restricted items to Russia and Belarus.
A Gulf state official stated that the UAE recognizes its crucial role in protecting the integrity of the global financial systems. “The UAE takes this responsibility very seriously and has robust and clear processes in place to deal avec sanctioned entities.”
Rosenberg spoke out citing the western steps to impose economic and financial sanctions on Russia for the invasion of Ukraine. However, she said that Moscow will continue to look for “ways around” these measures.
“The next year will be all about ensuring that our sanctions architecture works effectively and is fully enforced. In particular, we need to find and punish Russia’s attempts to evade sanctions.
Rosenberg said that the US and its allies are engaged in a broad campaign to combat such behavior. We are particularly concerned about trade with Russia, especially in goods that could be used on the battlefield or those who aid designated Russian entities. This type of assistance is being investigated at the sector, firm, and individual level.
The US agencies warned businesses that other red flags for sanction evasion include the use shell companies to make international wire transfers, last-minute shipping instructions changes, personal email addresses rather than company emails, and transactions with entities without an online presence.
In addition, the note cited other instances in which the justice department had brought criminal charges against the defendants for evasion of export controls and sanctions.