UK leads way in disrupting shadowy Russian sanctions evasion network

• Chancellor ramps up pressure on Kremlin-backed networks linked to Iranian regime as he attends first G20 in North Carolina.
• Healey to say allies must step up international cooperation to cut off the financial networks that fuel Russia aggression'
• First ever industry-wide alert issued exposing methods of Russia's notorious A7 network and penalties upped for those involved in sanctions breaches

The Chancellor has called on allies to step up their pressure on Russia, as he sets out new actions to stop Putin evading sanctions to fund his illegal war.

The Chancellor has used his first international meetings with counterparts to build an international coalition to target covert Russian networks funding Putin's illegal war.

The National Crime Agency (NCA) and the government have today (Monday 31 August) issued the first ever nationwide alert against A7 to support the private sector in bearing down on sanctions evasion and ensure Russia pays the full cost of the sanctions.

The alert aims to disrupt Kremlin-backed networks who have sought to circumvent international financial and trade sanctions through a complex web of financial structures spanning multiple jurisdictions. This alert aims to prevent Russian attempts to regain access to our financial systems.

The A7 network has also been linked to Iranian state-associated actors, reinforcing the need to tackle head-on the network's role in facilitating sanctions evasion and illicit financial activity.

The UK Government supports US work to secure a diplomatic solution to the Middle East conflict and welcomes efforts to increase pressure on Iran, including through Operation Economic Outcast.

The A7 Network relies on third-country financial institutions, and, in turn, the illicit use of the international financial system to complete cross-border transactions and circumvent sanctions. Within its first year of operating, A7 claims to have settled more than $86 billion of transactions.

The Chancellor will also double the maximum fine available to the Office for Financial Sanctions Implementation (OFSI) from 50% to 100% of the value of a sanctions breach. This will further strengthen the deterrent effect of the UK's sanctions regime and drive better enforcement.

Chancellor of the Exchequer, John Healey MP said:
"We are ramping up the economic pressure on Putin and leaving those aiding his illegal war with nowhere to hide.

"The UK and our allies must step up our international cooperation to expose sanctions evasion, and disrupt the financial networks fuelling Russia's aggression.

"Our commitment to stand with the Ukrainian people is unshakeable. We will bear down on those propping up Putin's war as we push to secure a just and lasting peace.

Rachael Herbert, Director of the National Economic Crime Centre (NECC) at the National Crime Agency, said:
The National Crime Agency and the National Economic Crime Centre are committed to targeting the nexus between organised crime and sanctions evasion.

Last year, our Operation Destabilise targeted and disrupted a major Russian-speaking professional money laundering network, making it harder for them to operate and degrading the threat they posed.

And through our close working with the financial sector in our public private partnership initiatives, as well as with the Office of Financial Sanctions Implementation, this alert will continue to ensure the industry is aware of the mechanisms used to attempt to evade sanctions.

The Chancellor arrived in North Carolina on Sunday for the G20 meeting of Finance Ministers and Central Bank Governors. While there he has held meetings with the Managing Director of the IMF Kristalina Georgieva, as well as his international counterparts including the US, France, Germany, Canada and India, in his first international trip as Chancellor.

Today's action builds on the UK's wider sanctions effort against Russia. Earlier this month the government introduced a major sanctions package targeting 19 targets, including Russian banks, shadow fleet vessels and businesses supporting the Kremlin's war effort, further choking off the networks and revenue streams on which Russia relies.

Since the start of Russia's full-scale invasion, the UK has imposed one of the world's most extensive sanctions regimes, targeting individuals, entities and vessels linked to the Kremlin and its war machine. This year alone the UK has imposed sanctions on more than 500 individuals, entities and ships under the Russia sanctions regime.