White House reiterates that the Treasury is on the lookout for crypto in Russian sanctions evasion

In a March 11 fact sheet on sanctions on Russia, the White House is once again spotlighting crypto as an area of concern.

The fact sheet spotlights coming “New guidance by the Department of Treasury to Thwart Sanctions Evasion, including through Virtual Currency.” 

“Treasury is closely monitoring any efforts to circumvent or violate Russia-related sanctions, including through the use of virtual currency,” the announcement reads. It is but the latest in a series of warning shots against crypto’s potential use. 

Earlier this week, the Treasury’s anti-money laundering watchdog put out an alert for a similar issue. But as The Block, as well as a number of officials at the Treasury itself, has noted, there is still no real evidence to indicate use of crypto in Russia’s sanctions evasion. 

There has, however, been a great deal of scrutiny on crypto exchanges that have not geo-blocked Russian users, despite no sanctions regime yet requiring them to do so. Despite no formal regime, a number of companies, both in finance and consumer goods, have cut off sales within Russia. 

At the same time, sanctions violations incur much more forceful penalties than failure to perform due diligence on AML controls. A firm that does business in the US can, if it services a sanctioned entity even unknowingly, be liable for criminal charges.