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The U.S. increases sanctions on Alrosa.

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Alrosa has been placed on the Specially Designated Nationals List, which means that U.S. companies must stop doing business with Alrosa immediately.

Washington–The U.S. Department of the Treasury’s Office of Foreign Assets Control increased sanctions against Alrosa last week.

The Specially Designated Nationals List was placed on the Russian diamond miner. This means that its assets were blocked, and U.S. individuals and businesses are effectively unable to do business with them.

This designation applies to all entities owned at least 50 percent directly or indirectly by Alrosa.

United Shipbuilding Corporation was also awarded this designation, a Russian company that builds most of the nation’s warships.

The U.S. Treasury Department stated that Treasury was cutting off additional revenue and support for the Government of the Russian Federation to wage unprovoked war on Ukraine through these designations.

IN FEBRUARY, the U.S. sanctioned Alrosa and its chief executive officer after Russia invaded Ukraine. The executive order of March 11 banned imports of non-industrial Russian diamonds into the United States.

Although the executive order allowed Russian diamonds to be legally imported into America, jewelers were advised not to do so.

Last week, a bipartisan group of Congress members wrote a letter asking for the investigation of this loophole by Janet Yellen and the Biden administration.

The Jewelers Vigilance Committee issued a Friday member alert regarding the new sanctions.

JVC stated that if a U.S. company has not stopped doing business directly with Alrosa, it must do so now.

“If an American business has goods or money in-house, Alrosa might have an ongoing interest (due to memo/consignment agreements or other contracts), these assets are now frozen. The business should seek counsel to determine the best way to proceed.”

A U.S. company may also be subject to asset blocking if it has an ownership or relationship interest in a foreign business doing business with Alrosa.

JVC stated that the best thing for businesses is to inform suppliers that they won’t buy any goods from Alrosa.

JVC stated that although it is unclear how OFAC and U.S. Customs will interpret the new designation, U.S. businesses that continue to deal with these goods even indirectly can face issues when attempting to import or freeze assets.

U.S. banks must also comply with the new sanctions. Jewelers will likely be asked for information to ensure compliance.

JVC stated that sanctions violations could result in significant civil and monetary fines. These fines are often in the millions, as well as prison sentences.

OFAC encourages businesses to report all possible illegal transactions.

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