US designates Russia's A7 Network a transnational criminal organization

The Treasury's Office of Foreign Assets Control designated Russia's A7 Network a significant transnational criminal organization on Thursday, listing addresses in Russia, Kyrgyzstan, Nigeria and Zimbabwe. Treasury says Iran and the Islamic Revolutionary Guard Corps have used the shadow banking network to evade sanctions. The Financial Crimes Enforcement Network separately proposed prohibiting transfers involving the network's Sub-Agents, which it says disguise sanctioned payments as ordinary trade. FinCEN chose a transmittal-of-funds prohibition under section 9714 of the Combating Russian Money Laundering Act, which provides six special measures. TRM Labs noted that a measure restricting correspondent accounts would not reach A7A5 transactions conducted outside correspondent banking. FinCEN considers those transactions integral to the network's business model. The proposed prohibition would cover fiat and crypto transfers and bind roughly 348,000 institutions, including crypto exchanges. A7A5 is a ruble-backed token issued by Kyrgyz-registered Old Vector on the Tron and Ethereum networks, with deposits held at Russia's state-owned defense bank Promsvyazbank. FinCEN describes a system in which tokens move between addresses inside Russia to represent payments abroad. Sub-Agents make matching fiat transfers in dollars, yuan, dirhams and euros, keeping the two sides separate. FinCEN found that more than 180 entities processed at least $179.1 billion in A7A5 between February 2025 and June 2026, historically almost all through the sanctioned exchanges Garantex and Grinex. A7A5 is most often used as a non-freezable bridge into USDT and then fiat. Since a reported hack at Grinex in April, A7A5 supply has consolidated into unhosted wallets. FinCEN sees that consolidation as a possible move away from sanctioned venues. A7 has created or acquired hundreds of Sub-Agents with accounts at about 435 financial institutions across at least 83 countries, processing more than $17 billion between January 2025 and June 2026. Staff operate those accounts from Moscow through custom VPNs that make activity appear to originate in Dubai, Hong Kong or Bishkek. Treasury said one Sub-Agent dealt directly with entities tied to Iran's shadow fleet of tankers. Treasury said that Sub-Agent and a sister company received close to $140 million from firms involved in Iranian sanctions evasion. Another Sub-Agent sent about $1.6 million to a company linked to weapons procurement. Treasury also links the network to Nobitex, an Iranian exchange it designated in June, and to laundering proceeds from North Korean exchange hacks. Fugitive Moldovan oligarch Ilan Shor and Promsvyazbank launched the network in September 2024. By January, the network claimed to handle more than 2,000 transactions a day. Its stated historical volume of 7.5 trillion rubles, about $91.5 billion, would equal roughly one-eighth of Russia's foreign trade last year. The European Union previously sanctioned parts of the network. The United Kingdom's National Crime Agency issued an alert in August. Treasury Secretary Scott Bessent warned that parties facilitating illicit finance for America's adversaries would lose access to the US financial system. The comment period on FinCEN's proposed rule closes 30 days after its publication in the Federal Register.