OFAC Obtains $1 Million Settlement for Violations of Russia Sanctions
On January 16, 2025, the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC) reached a settlement with Florida-based real estate company Family International Realty LLC (the “Company”) and its owner, a U.S. person. Rather than risk liability for its 73 apparent sanctions violations, the Company has settled with OFAC for $1,076,923.
Washington, D.C. (January 31, 2025) - On January 16, 2025, the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC) reached a settlement with Florida-based real estate company Family International Realty LLC (the “Company”) and its owner, a U.S. person. Rather than risk liability for its 73 apparent sanctions violations, the Company has settled with OFAC for $1,076,923. The Company was alleged to have engaged in a willful scheme to evade sanctions by helping two sanctioned Russian oligarchs transfer their ownership of luxury condominiums to non-sanctioned family members and their shell companies. In total, the Company was awarded only $182,442 in commission fees and reimbursement for their services. According to OFAC, the substantial settlement reflects the egregiousness of the violations and the fact that they were not voluntarily disclosed.
The two sanctioned individuals, Valeri Abramov and Viktor Perevalov, were designated by OFAC to the Specially Designated Nationals and Blocked Persons List (SDN List) in 2018. This designation was earned through their involvement in the construction of transportation infrastructure for the “Republic of Crimea” following Russia’s illegal occupation of the Crimea region of Ukraine in 2014.
The owner of the Company allegedly maintained financial ties to the Russian oligarchs before their designations and continued the relationship until at least 2023. Text messages obtained during OFAC’s investigation showed the owner’s direct knowledge of the designations and willful attempts to conceal the oligarchs’ ownership over the properties. These factors, among others, were used as aggravating factors in determining the settlement amount.
OFAC warns so-called gatekeepers, such as realtors, attorneys and others, against enabling sanctions evasions. Misuse of their unique expertise exposes themselves and others to liability and financial repercussions.
Lewis Brisbois’s attorneys are actively engaged in the wide range of legal issues in this area and are advising clients on managing legal and business risk as events continue to develop at an accelerated pace. For more information, contact the author or editor of this alert, and visit our Ukraine Conflict, International Trade, Export, Import and Investment Controls & National Security Practice page for additional alerts in this area.
Author:
Rebecca Wiley, Associate
Editor:
Andrew Pidgirsky, Partner and Chair of Ukraine Conflict, International Trade, Export, Import and Investment Controls & National Security Practice