Finding and NPRM: Special measure regarding transactions involving the A7 Network's sub-agents (91 FR 63208) (Part 1 of 2)
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Research, not advice. Part of the Bitcoin research archive (October 2026). Claims labelled unverified, contested or fringe are reported, not endorsed; statuses of bills and rules are as of the date checked. Government, court and patent records are public domain; the research notes are CC BY 4.0.
63208 Federal Register / Vol. 91, No. 191 / Monday, October 5, 2026 / Proposed Rules
CONSUMER PRODUCT SAFETY information about joining the webinar. present and, in accordance with the
COMMISSION All other individuals who wish to requirement in section 9 of the CPSA,
attend the meeting virtually but are not the Commission is providing a forum for
16 CFR Parts 1112 and 1265 presenting should register using the oral opportunity to make an oral
[Docket No. CPSC–2025–0012] same internet link provided above presentation, see the information under
before the start of the hearing. the DATES and ADDRESSES sections of
RIN 3041–AE10 this document.1 Each oral presentation
FOR FURTHER INFORMATION CONTACT: For
further information about the subject will be limited to 5 minutes, excluding
Safety Standard for Lithium-Ion time for questioning by the
Batteries Used in Micromobility matter of this hearing, contact Jay
Kadiwala, Project Manager, Electrical Commissioners or CPSC staff. Oral
Products and Electrical Systems of presentations must be limited to matters
Micromobility Products Containing Engineer, Office of Risk Reduction,
Consumer Product Safety Commission, within the scope of the NPRM identified
Such Batteries in this notice. To avoid duplicate
National Product Testing and
AGENCY: Consumer Product Safety Evaluation Center, 5 Research Place, presentations, groups or participants
Commission. Rockville, MD 20850; telephone: (301) with substantially similar comments
ACTION: Announcement of opportunity 987–2517; email: [email protected]. should designate a spokesperson, and
for oral presentation of comments. For information about the hearing the presiding officer may impose
procedure to make an oral presentation, additional reasonable restrictions as
SUMMARY: The Consumer Product Safety necessary for the orderly and efficient
contact Alberta E. Mills, Office of the
Commission (Commission or CPSC) is Secretary; telephone: 301–504–7479; conduct of the hearing.
providing an opportunity for interested email: [email protected]. Alberta E. Mills,
parties to present oral comments on the
notice of proposed rulemaking (NPRM) SUPPLEMENTARY INFORMATION: Secretary, Consumer Product Safety
Commission.
the Commission issued for a safety I. Background
[FR Doc. 2026–20296 Filed 10–2–26; 8:45 am]
standard for lithium-ion batteries. Oral
On June 24, 2026, the Commission BILLING CODE 6355–01–P
presentations must be limited to matters
published an NPRM in the Federal
within the scope of the NPRM. Any oral
Register, proposing to issue a safety
comments will become part of the
standard for lithium-ion batteries used DEPARTMENT OF THE TREASURY
rulemaking record.
in micromobility products under the
DATES: The virtual meeting will begin at
Consumer Product Safety Act (CPSA; 15 Financial Crimes Enforcement Network
10 a.m. Eastern time on October 21, U.S.C. 2051–2089), and seeking written
2026. Any individual interested in comments. 91 FR 38162. The NPRM 31 CFR Part 1010
making an oral presentation must seeks to address the unreasonable risk of
submit a request to make an oral RIN 1506–AB77
injury and death associated with
presentation to the Office of the micromobility products due to hazards
Secretary, along with the written text of Proposal of Special Measure
such as thermal runaway of lithium Prohibiting the Transmittal of Funds
the oral presentation. Request must be cells, which can lead to fires,
received no later than 5 p.m. Eastern Regarding Transactions Involving the
explosions, gas releases, burns, A7 Network’s Sub-Agents
time on October 15, 2026. All attendees overheating, and smoke inhalation. The
planning to present must pre-register no NPRM proposes that electrical systems AGENCY: Financial Crimes Enforcement
later than 5 p.m. Eastern time on using lithium-ion batteries in Network (FinCEN), Treasury.
October 15, 2026, at the website in micromobility products comply with ACTION: Notice of proposed rulemaking.
ADDRESSES.
applicable voluntary standards, with SUMMARY: FinCEN is issuing a finding
ADDRESSES: The opportunity to present modifications. The NPRM is available and notice of proposed rulemaking,
oral presentation of comments will be at: https://www.federalregister.gov/ pursuant to section 9714(a) of the
held virtually as a webinar meeting at documents/2026/06/24/2026-12749/ Combating Russian Money Laundering
https://events.gcc.teams.microsoft.com/ safety-standard-for-lithium-ion- Act (Public Law 116–283), as amended
event/49fa92df-dd39-4c16-803b-cd59 batteries-used-in-micromobility- by section 6106(b) of the National
dd7847b8@7f5de26c-a63d-475c-9b6c- products-and-electrical-systems-of. Defense Authorization Act for Fiscal
4126a914e132?source=
II. The Public Hearing Year 2022 (Public Law 117–81), finding
copyLinkLegacyShareLinkDialog. transactions involving any company
Attendance is free of charge. Requests to The Administrative Procedure Act (5 operating outside of the United States
make oral presentations must provide U.S.C. 551–562) and section 9 of the that is controlled by the A7 Network, a
the written text of oral presentations to CPSA require the Commission to sanctions evasion and money
the Office of the Secretary, with the provide interested parties with an laundering service with ties to Russia,
caption, ‘‘Lithium-Ion Battery NPRM; opportunity to submit ‘‘written data, leveraged by a wide range of illicit
Oral Presentation,’’ by email to cpsc-os@ views, or arguments’’ regarding a actors, including Iran and its terrorist
cpsc.gov. All attendees planning to proposed rule. 5 U.S.C. 553(c); see 15 proxies, to be a class of transactions of
present must pre-register for the U.S.C. 2058(d)(2). The NPRM invited primary money laundering concern in
webinar online at: https:// such written comments. In addition, connection with Russian illicit finance
lotter on DSK8BHNXB4PROD with PROPOSALS1
events.gcc.teams.microsoft.com/event/ section 9 of the CPSA requires the and proposing the imposition of a
49fa92df-dd39-4c16-803b-cd59 Commission to provide interested prohibition on certain transmittals of
dd7847b8@7f5de26c-a63d-475c-9b6c- parties ‘‘an opportunity for oral funds, by any covered financial
4126a914e132?source=copyLinkLegacy presentation of data, views, or institution, involving that class of
ShareLinkDialog, no later than 5 p.m. arguments.’’ 15 U.S.C. 2058(d)(2). The transactions.
Eastern time on October 15, 2026. After Commission must keep a transcript of
registering, presenters will receive a such oral presentations. Id. The 1 The Commission voted 3–0 to publish this
confirmation email containing Commission received requests to notification.
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Federal Register / Vol. 91, No. 191 / Monday, October 5, 2026 / Proposed Rules 63209
DATES: Written comments on the notice transactions present a material risk of special measures one through four, the
of proposed rulemaking must be facilitating funds transfers designed to Secretary may impose additional
submitted on or before November 4, evade sanctions by illicit actors, recordkeeping, information collection,
2026. including Russian and Iranian persons and reporting requirements on covered
ADDRESSES: Comments must be that have been designated by Treasury’s financial institutions.6 Through special
submitted in one of the following two Office of Foreign Assets Control measure five, the Secretary, in
ways (please choose only one of the (OFAC), such as the Islamic consultation with the Secretary of State,
ways listed): Revolutionary Guard Corps (IRGC), and the Attorney General, and the Chairman
• Federal E-rulemaking Portal: intended to support illicit activities, of the Board of Governors of the Federal
https://www.regulations.gov. If you are including sanctions evasion involving Reserve System, may ‘‘prohibit, or
reading this document on or benefitting Russian and Iranian impose conditions upon, the opening or
federalregister.gov, you may use the clients. maintaining in the United States of a
green ‘‘SUBMIT A PUBLIC COMMENT’’ correspondent account or payable-
II. Background
button beneath this rulemaking’s title to through account’’ for or on behalf of a
submit a comment to the regulations.gov A. Statutory Provisions foreign banking institution, if such
docket. Section 9714(a) of the Combating correspondent account or payable-
• Mail: Financial Crimes Enforcement Russian Money Laundering Act (Pub. L. through account involves the class of
Network, P.O. Box 39, Vienna, VA 116–283), as amended by section transactions found to be of primary
22183. Refer to Docket Number 6106(b) of the National Defense money laundering concern.7 In addition
FINCEN–2026–0265 in the submission. Authorization Act for Fiscal Year 2022 to the special measures set out in 31
Do not include any personally U.S.C. 5318A, section 9714 also
(Pub. L. 117–81) (section 9714),2
identifiable information (such as name, provides that the Secretary may impose
provides, in relevant part, that, if the
address, or other contact information) or a special measure prohibiting, or
Secretary of the Treasury (Secretary)
confidential business information that imposing conditions upon, certain
‘‘determines that reasonable grounds
you do not want publicly disclosed. All transmittals of funds.8
exist for concluding that . . . one or
comments are public records; they are
more classes of transactions within, or B. A7 Network and its Sub-Agents
publicly displayed exactly as received,
involving, a jurisdiction outside the
and will not be deleted, modified, or
United States . . . is of primary money The OFAC-sanctioned transnational
redacted. Comments may be submitted
laundering concern in connection with criminal organization (TCO), A7
anonymously. Follow the search
Russian illicit finance,’’ the Secretary Network, is a global wholesale sanctions
instructions on https://
may, ‘‘by order, regulation, or otherwise evasion and money laundering service
www.regulations.gov to view public
as permitted by law’’: (1) require with ties to Russia, leveraged by a wide
comments.
domestic financial institutions and range of illicit actors, including Iran and
FOR FURTHER INFORMATION CONTACT: domestic financial agencies to take 1 or its terrorist proxies. Approximately 80
FinCEN’s Regulatory Support Section by more of the special measures described percent of Russian banks have been
submitting an inquiry at in 31 U.S.C. 5318A(b); 3 or (2) prohibit, sanctioned by the United States, United
www.fincen.gov/contact. or impose conditions upon, certain Kingdom, and European Union since
SUPPLEMENTARY INFORMATION: transmittals of funds (as defined by the 2022, and numerous key Russian banks
I. Summary of Notice of Proposed Secretary) by any domestic financial have lost their access to the Society of
Rulemaking institution or domestic financial agency, Worldwide Interbank Financial
if such transmittal of funds involves any Telecommunication (SWIFT).9 U.S.,
This notice of proposed rulemaking such class of transaction. The authority European Union (EU), and/or United
(NPRM) (1) sets forth FinCEN’s finding of the Secretary to administer both Kingdom (UK) sanctions and the
that transactions involving any section 9714 and the Bank Secrecy Act resulting ‘‘de-SWIFTing’’ of Russian
company operating outside of the (BSA) has been delegated to FinCEN.4 banks have significantly curtailed
United States that is controlled by the Pursuant to section 9714, the Russia’s connectivity to the
A7 Network 1 (a ‘‘Sub-Agent’’ and, Secretary may impose one or more of six international financial system, leaving a
collectively, the ‘‘Sub-Agents’’), are a special measures. First, the Secretary void for the A7 Network to fill. Against
class of transactions of primary money may impose any of the five special that backdrop and although the A7
laundering concern in connection with measures provided for in 31 U.S.C. Network markets itself as merely an
Russian illicit finance; and (2) proposes 5318A(b), commonly known as section alternative payment system, the A7
prohibiting certain transmittals of funds 311 of the USA PATRIOT Act.5 Through Network was formally launched in
involving that class of transactions by September 2024 as a purpose-built
any covered financial institution. As set 2 Section 9714 (as amended) may be found in a mechanism to evade Western sanctions
out in this NPRM, transactions note to 31 U.S.C. 5318A. imposed in response to Russia’s further
involving any Sub-Agent fall within a 3 See infra note [4].
4 Pursuant to Treasury Order 180–01, the
class of transactions of primary money United States is of primary money laundering
authority of the Secretary to administer the BSA,
laundering concern in connection with including, but not limited to, 31 U.S.C. 5318A, has concern, to require domestic financial institutions
Russian illicit finance, as such been delegated to the Director of FinCEN. U.S. and domestic financial agencies to take certain
Department of the Treasury, Treasury Order 180–01 ‘‘special measures.’’ Regarding the ‘‘special
1 On October 1, 2026, the Department of the (Jan. 14, 2020). On August 11, 2022, and in measures’’ that might be imposed, section 9714
lotter on DSK8BHNXB4PROD with PROPOSALS1
accordance with Treasury Order 101–05 and 31 references the five special measures set out in 31
Treasury’s Office of Foreign Assets Control (OFAC)
U.S.C. 321(b), Treasury’s Under Secretary for U.S.C. 5318A(b)(1)–(5).
sanctioned the A7 Network pursuant to Executive 6 31 U.S.C. 5318A(b)(1)–(4).
Order 13581, as amended by Executive Order Terrorism & Financial Intelligence re-delegated to
7 31 U.S.C. 5318A(b)(5).
13863, for being a foreign person that constitutes a the Director of FinCEN the authority of the
Secretary under section 9714. 8 See section 9714(a)(2).
significant Transnational Criminal Organization.
See U.S. Department of the Treasury, Operation 5 See 31 U.S.C. 5318A. 31 U.S.C. 5318A grants the 9 Congressional Research Service, Russia’s War on
Economic Outcast Takes Unprecedented Action Secretary the authority, upon finding that Ukraine: Financial and Trade Sanctions (Feb. 22,
Against Sanctions Evasion Network Used by Iran reasonable grounds exist for concluding that one or 2023), at p. 2, https://www.congress.gov/crs-
(Oct. 1, 2026). more financial institutions operating outside of the product/IF12062.
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63210 Federal Register / Vol. 91, No. 191 / Monday, October 5, 2026 / Proposed Rules
invasion of Ukraine in 2022.10 However, United States, EU, and UK.14 These these persons described above that are
as a self-described sanctions-resistant entities administer the network with in the United States or in the possession
payment service provider, the A7 and through several Russia- and Kyrgyz or control of U.S. persons are blocked
Network has evolved into a conduit for Republic-based persons, including and must be reported to OFAC. In
illicit activity associated with a wide businesses and digital asset exchanges addition, any entities that are owned,
range of threat actors, including North subject to sanctions imposed by OFAC directly or indirectly, individually or in
Korea (DPRK);Iran-backed terrorist and the UK (as well as, in most cases, the aggregate, 50 percent or more by one
organizations; cybercriminals and the EU), including Old Vector LLC, or more blocked persons are also
ransomware actors; and the IRGC.11 Garantex, Grinex, Independent blocked. Unless authorized by a general
The A7 Network’s creation was driven Decentralized Finance Smartbank and or specific license issued by OFAC, or
by two U.S.-, EU- and UK-designated Ecosystem (InDeFi Bank), ExVed, and exempt, OFAC’s regulations generally
parties: fugitive Moldovan oligarch Ilan Garantex co-founder Sergey Mendeleev prohibit all transactions by U.S. persons
Shor 12 and Russia’s state-owned (Mendeleev).15 Collectively, these or within (or transiting) the United
defense bank Promsvyazbank Public entities leverage companies transacting States that involve any property or
Joint Stock Company (PSB).13 The core in both fiat currency and digital assets interests in property of designated or
of the A7 Network is formed by three in complex trade-based money otherwise blocked persons. In addition,
Russia-based companies—A7 Liability laundering schemes to enable illicit
Company (A7 LLC), and its subsidiaries, financial institutions and other persons
actors to access the international
A71 Limited Liability Company (A71 that engage in certain transactions or
financial system.16
LLC) and A7 Agent Limited Liability Significantly (and as noted above), activities with these sanctioned entities
Company (A7 Agent LLC)—which are OFAC has designated the founders and and individuals may expose themselves
jointly owned by Ilan Shor and PSB and these core components and enablers, as to sanctions, including making of any
subject to sanctions imposed by the well as sanctioning the A7 Network as contribution or provision of funds,
a significant TCO.17 As a result, all goods, or services by, to, or for the
10 At least some elements of the A7 Network had property and interests in property of benefit of any designated person, or the
a job posting listed in early 2026, seeking receipt of any contribution or provision
candidates with experience using SWIFT, and the 14 U.S. Department of the Treasury, Press Release, of funds, goods, or services from any
company has hired staff from major Russian
banks—including OFAC-sanctioned Gazprombank,
Treasury Sanctions Cryptocurrency Exchange and such person, or be subject to an
Network Enabling Sanctions Evasion and Cyber enforcement action.
VTB Bank, and Sberbank—suggesting that the A7 Criminals (Aug. 14, 2025), https://
Network is intended to supplant the role previously
filled by Russia’s heavily sanctioned banking sector.
home.treasury.gov/news/press-releases/sb0225; Building on these actions, FinCEN
FCDO, UK Sanctions List, Several entities, https:// assesses that the A7 Network has
HeadHunter, Manager for work with large and search-uk-sanctions-list.service.gov.uk/
medium-sized businesses (last accessed July 1, ?searchValue=promsvyazbank, https://search-uk- created, and continues to operate, a
2026), https://hh.ru/vacancy/134528312?query= sanctions-list.service.gov.uk/?searchValue= financial network to further and enable
A7+SWIFT&hhtmfrom=vacancy_search_list; Open A7%2520llc; European Union Sanctions Tracker,
Source Centre, The Big Shor: A7 and the illusion
widespread sanctions evasion and the
Ilan Shor, https://data.europa.eu/apps/
of Russian financial innovation (2026), at p. 25, eusanctionstracker/subjects/153809.
laundering of billions of dollars tied to
https://static.opensourcecentre.org/assets/osc_a7_ 15 See FCDO, UK Sanctions List, Several entities, illicit activity. When A7 LLC was
big_shor.pdf. https://search-uk-sanctions-list.service.gov.uk/ founded in 2024, PSB issued a press
11 See generally TRM Labs, ‘‘The A7 Leaks: TRM’s
designations/RUS3614/Individual; https:// release touting the new service as a way
On-Chain Analysis of Russia’s Cryptocurrency www.gov.uk/government/news/uk-targets-
Connections’’ (June 12, 2026). sanctions-circumvention-and-crypto-networks- to ‘‘support Russian foreign trade
12 Ilan Shor was designated by OFAC in October
exploited-by-russia. European Union Sanctions participants and their trading partners
2022, pursuant to E.O. 14024, for his involvement tracker, Several entities, https://data.europa.eu/ amid anti-Russian sanctions pressure,’’
in Russian malign influence operations in Moldova. apps/eusanctionstracker/subjects/179337, https://
He was previously arrested on money laundering data.europa.eu/apps/eusanctionstracker/subjects/
indicating that sanctions evasion is part
and embezzlement charges related to a 2014 theft 172907, https://data.europa.eu/apps/ of the business model.18 Speaking at the
valued at approximately USD 1 billion from eusanctionstracker/subjects/179375. Russia-China Mutually Beneficial
Moldovan banks. U.S. Department of the Treasury, 16 See U.S. Department of the Treasury, Press
Cooperation forum (ROSTKI) in August
Press Release, Treasury Targets Corruption and the Release, Treasury Sanctions Cryptocurrency
Kremlin’s Malign Influence Operations in Moldova Exchange and Network Enabling Sanctions Evasion
2025, A7 LLC’s Vice President Mikhail
(Oct. 26, 2022), https://home.treasury.gov/news/ and Cyber Criminals (Aug. 14, 2025), https:// Tolkunov described A7’s core
press-releases/jy1049. Ilon Shor was also home.treasury.gov/news/press-releases/sb0225; U.S. capabilities:
sanctioned by the United Kingdom on December 8, Department of the Treasury, Press Release, Treasury
2022. See UK Foreign, Commonwealth and Targets Corruption and the Kremlin’s Malign ‘‘The company ‘A7’ was created by PSB
Development Office (FCDO), Uk Sanctions List, Influence Operations in Moldova (Oct. 26, 2022), Bank [in 2025] and operates in the field of
https://search-uk-sanctions-list.service.gov.uk/ https://home.treasury.gov/news/press-releases/ cross border transfers . . . the service allows
designations/GAC0029/Individual. jy1049; U.S. Department of the Treasury, Press
you to create a personal account remotely
13 PSB was designated by OFAC in February Release, Treasury Sanctions Russia-Based Hydra,
2022, pursuant to E.O. 14024, for issuing billions World’s Largest Darknet Market, and Ransomware- and transfer funds within one day with
of dollars in financial support for Russian defense Enabling Virtual Currency Exchange Garantex (Apr. minimal fees. Document management is
sector companies in its role as Russia’s state defense 5, 2022), https://home.treasury.gov/news/press- carried out electronically . . . The platform
bank. U.S. Department of the Treasury, Press releases/jy0701; U.S. Department of the Treasury, was created for transfers in any currency,
Release, U.S. Treasury Imposes Immediate Press Release, U.S. Treasury Imposes Immediate
Economic Costs in Response to Actions in the including dollars, yuan, dirhams, and euros.
Economic Costs in Response to Actions in the
Donetsk and Luhansk Regions (Feb. 22, 2022), Donetsk and Luhansk Regions (Feb. 22, 2022), Transfers are completely secure, as our entire
https://home.treasury.gov/news/press-releases/ https://home.treasury.gov/news/press-releases/ financial infrastructure is built on an
jy0602. PSB was later redesignated in January 2025, jy0602. independent architecture and is not tied to
pursuant to E.O. 13662, for operating in the 17 On October 1, 2026, the Department of the
lotter on DSK8BHNXB4PROD with PROPOSALS1
international payment systems. This means
financial services sector of the Russian Federation Treasury’s Office of Foreign Assets Control (OFAC)
economy. U.S. Department of the Treasury, Press sanctioned the A7 Network pursuant to Executive
Release, Treasury Disrupts Russia’s Sanctions Order 13581, as amended by Executive Order 18 Promsvyazbank, PSB has launched a unique
Evasion Schemes (Jan. 15, 2025), https:// 13863, for being a foreign person that constitutes a mechanism for crossborder settlements for foreign
home.treasury.gov/news/press-releases/jy2785; see significant Transnational Criminal Organization. trade between Russian companies and
also Open Source Centre, The Big Shor: A7 and the See U.S. Department of the Treasury, Operation counterparties from any country (Oct. 8, 2024),
Illusion of Russian Financial Innovation (2026), at. Economic Outcast Takes Unprecedented Action https://www.oreanda-news.com/en/finansy/
p. 9, https://static.opensourcecentre.org/assets/osc_ Against Sanctions Evasion Network Used by Iran promsvyazbank-has-launched-a-mechanism-for-
a7_big_shor.pdf. (Oct. 1, 2026). cross-border-settlements/article1531534/.
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Federal Register / Vol. 91, No. 191 / Monday, October 5, 2026 / Proposed Rules 63211
we are not threatened by any unilateral based company reportedly used the A7 Shor stated that ‘‘A7 plans to operate
restrictions.’’ 19 Network to obfuscate transactions everywhere.’’ 28
As of January 2026, the A7 Network related to the purchase of Russian gas III. Finding That Transactions
claimed to process more than 2,000 supplies for Türkiye following the Involving any Sub-Agent of the A7
transactions per day with a historical imposition of sanctions on Russian bank Network Are a Class of Transactions of
total transaction volume of more than Gazprombank, which typically handles Primary Money Laundering Concern in
7.5 trillion rubles (RUB), the equivalent energy transactions.24 Connection With Russian Illicit Finance
of USD 91.5 billion. This would amount
The scope of the A7 Network’s Based on public and non-public
to nearly 13 percent of the Russian
Federation’s 2025 foreign trade activities is only possible through its information available to FinCEN,
transactions, meaning that nearly one in global network of Sub-Agents. Shortly FinCEN finds that reasonable grounds
eight dollars of Russia’s foreign trade after its establishment, the A7 Network exist for concluding that transactions
allegedly flows through A7’s Network.20 began aggressively expanding into new involving any Sub-Agent of the A7
There are indications that the Russian jurisdictions and forming companies— Network are a class of transactions of
government perceives the A7 Network ‘‘Sub-Agents’’—controlled by the A7 primary money laundering concern in
to be a strategically important Network and designed to receive and connection with Russian illicit finance,
enterprise. In September 2025 Russian remit payments to facilitate transactions as such transactions present a material
President Vladimir Putin attended the for the A7 Network. The first Sub- risk of facilitating funds transfers
virtual ribbon cutting for the opening of Agents were established in the Kyrgyz designed to evade sanctions by illicit
an A7 Network office in Vladivostok, Republic, and the A7 Network has since actors, including Russian and Iranian
Russia.21 Several oligarchs with close established Sub-Agents across Central persons that have been designated by
ties to the Kremlin have reportedly used OFAC, and intended to support illicit
and East Asia, Africa, Europe, and the
the A7 Network to make international activities, including sanctions evasion
Middle East.25
payments, including UK-sanctioned involving or benefitting Russian and
Roman Abramovich, OFAC-sanctioned The A7 Network has indicated it Iranian clients. In making this finding,
former Federal Security Service Director plans to expand its global footprint, FinCEN has considered the relevant
Nikolai Patrushev, OFAC-sanctioned potentially enhancing its reach and evidence in light of factors identified in
Arkady Rotenberg, and businesses ability to move funds outside of the 31 U.S.C. 5318A(c)(2)(B), taking into
linked to UK-sanctioned Leonid formal financial system into currently account the specific circumstances of
Mikkelson.22 Moreover, two OFAC- untapped regions, including Latin money laundering activities in
sanctioned Russian financial America.26 Until recently, the A7 connection with Russian illicit finance
institutions maintain an interest in the Network only had a physical presence and the protection of U.S. national
A7 Network, PSB and VEB.RF (VEB), in Russia, but in the fall of 2025 the security and the U.S. financial system.
Russia’s state-owned development company announced the opening of its While FinCEN is under no obligation
bank.23 Additionally, a Kyrgyzstan- first overseas offices in Nigeria and pursuant to section 9714 to consider any
Zimbabwe and signaled aspirations to particular factor or set of factors when
19 Kommersant, Investment Cooperation Between
further expand in Africa.27 In June 2026, making a finding that a financial
Russia and China: Growth Points. Kommersants institution operating outside of the
Session at the Third Russia-China International United States is of primary money
Forum (Aug. 19, 2025), at p. 2, https:// Information Resilience, A7 Abroad: How A7 Sells
www.events.kommersant.ru/events/sessiya-na- International Sanctions Evasion as a Service (Oct.
laundering concern in connection with
rostki-2025. 2025), at p. 5, https://www.info-res.org/app/ Russian illicit finance, it nonetheless
20 Centre for Information Resilience, A7 in Africa uploads/2025/10/A7-Abroad-FINAL-Copy.pdf. VEB finds these factors instructive in guiding
(Apr. 2, 2026), at p. 3, https://www.info-res.org/app/ was sanctioned by OFAC in 2022 at the same time the analysis set forth below.29
uploads/2026/04/A7-Africa-Final.pdf. as PSB. U.S. Department of the Treasury, U.S.
21 Radio Free Europe/Radio Liberty, A7, Company Treasury Imposes Immediate Economic Costs in
28 Reuters, Russia’s A7 transborder payments
Implicated In Sanctions Evasion, Reportedly Linked Response to Actions in the Donetsk and Luhansk
Regions (Feb. 22, 2022), https://home.treasury.gov/ company plans global expansion (June 4, 2026),
To Russian Oligarchs (Apr. 30, 2026), https:// https://www.reuters.com/business/finance/russias-
www.rferl.org/a/russia-cryptocurrency-a7a5-ilan- news/press-releases/jy0602. UK Foreign,
Commonwealth and Development Office Sanctions a7-transborder-payments-company-plans-global-
shor-investigation-sanction-evasion/33746026.html. expansion-2026-06-04/.
22 Radio Free Europe/Radio Liberty, A7, Company List, Roman Abrahmovich, (March 10, 2022)
29 31 U.S.C. 5318A(c)(2)(B) provides, as relevant
Implicated In Sanctions Evasion, Reportedly Linked https://search-uk-sanctions-list.service.gov.uk/
designations/RUS1126/Individual. here, that in making a finding that reasonable
To Russian Oligarchs (Apr. 30, 2026), https:// grounds exist for concluding that a class of
24 Radio Free Europe/Radio Liberty, A7, Company
www.rferl.org/a/russia-cryptocurrency-a7a5-ilan- transactions within, or involving, a jurisdiction
shor-investigation-sanction-evasion/33746026.html; Implicated In Sanctions Evasion, Reportedly Linked
outside the United States is of primary money
UK Foreign, Commonwealth and Development To Russian Oligarchs (Apr. 30, 2026), https://
laundering concern and to apply one or more of
Office Sanctions List, Roman Arkadyevich www.rferl.org/a/russia-cryptocurrency-a7a5-ilan- special measures one through four to such a
Abramovich (Mar. 10, 2022), https://search-uk- shor-investigation-sanction-evasion/33746026.html. financial institution, the Secretary shall consider
25 Open Source Centre, The Big Shor: A7 and the
sanctions-list.service.gov.uk/designations/ such information as the Secretary determines to be
RUS0270/Individual; U.S. Department of the Illusion of Russian Financial Innovation (2026), at. relevant, including the following potentially
Treasury, Treasury Designates Russian Oligarchs, pp. 25–26, https://static.opensourcecentre.org/ relevant factors:
Officials, and Entities in Response to Worldwide assets/osc_a7_big_shor.pdf. (1) The extent to which such financial
Malign Activity (Apr. 6, 2018), https:// 26 See Centre for Information Resilience, A7
institutions, transactions, or types of accounts are
home.treasury.gov/news/press-releases/sm0338; Abroad: How A7 Sells International Sanctions used to facilitate or promote money laundering in
U.S. Department of the Treasury, Treasury Evasion as a Service (Oct. 2025), at p.8, https:// or through the jurisdiction, including any money
Sanctions Russian Officials, Members Of The www.info-res.org/app/uploads/2025/10/A7-Abroad- laundering activity by organized criminal groups,
Russian Leadership’s Inner Circle, And An Entity FINAL-Copy.pdf; see also Alexander Osipovich, international terrorists, or entities involved in the
lotter on DSK8BHNXB4PROD with PROPOSALS1
For Involvement In The Situation In Ukraine (Mar. ‘‘Russia’s Hottest Startup Is a State-Backed proliferation of weapons of mass destruction or
20, 2014), https://home.treasury.gov/news/press- Sanctions Evasion Network,’’ The Wall Street missiles;
releases/jl23331; UK Foreign, Commonwealth and Journal (Aug. 7, 2026), https://www.wsj.com/world/ (2) The extent to which such institutions,
Development Office Sanctions List, Leonid russia/russias-hottest-startup-is-a-state-backed- transactions, or types of accounts are used for
Viktorovich Mikhelson (Apr. 6, 2022), https:// sanctions-evasion-network-7afc488c?mod=article_ legitimate business purposes in the jurisdiction;
search-uk-sanctions-list.service.gov.uk/ inline. and
designations/RUS1126/Individual. 27 Centre for Information Resilience, A7 in Africa (3) The extent to which such action is sufficient
23 PSB pledged its ownership stake in A7 LLC to (Apr. 2, 2026), at p. 2, https://www.info-res.org/app/ to ensure, with respect to transactions involving the
VEB as collateral for loans to A7 LLC. Centre for uploads/2026/04/A7-Africa-Final.pdf. Continued
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63212 Federal Register / Vol. 91, No. 191 / Monday, October 5, 2026 / Proposed Rules
A. The Extent to Which Transactions (UAE). Although on paper, these provided by IT companies controlled by
Involving any Sub-Agent of the A7 companies are typically represented to Ilan Shor and have operated on the
Network Are a Class of Transactions of be owned or managed by non-Russian domains muzpan.com and
Primary Money Laundering Concern in third-country nationals, they are sodkamus.com and often appear to have
Connection With Russian Illicit Finance ultimately controlled by with the A7 IP addresses in Dubai, Hong Kong, or
As indicated above, the A7 Network Network.31 Once established, Sub- the Kyrgyz Republic, thereby disguising
provides a financial services Agents provide the A7 Network with the connection to Russia.35 Thus, there
infrastructure for clients in Russia and access to correspondent banking is often no clear indication of a
other heavily sanctioned jurisdictions, relationships and foreign-currency connection between a Sub-Agent and
such as Iran, that enables those clients liquidity, enabling the A7 Network to the A7 Network’s clients, including, in
to make cross-border payments in both transmit value through the international particular, clients in the heavily
fiat currency and digital assets while financial system without a Russian or sanctioned jurisdiction, on whose behalf
obscuring the sanctions nexus from U.S. other sanctioned customer appearing in the Sub-Agent is transacting. Sub-Agent
and foreign financial institutions. the payment chain and commonly transactions, however, are likely to
Importantly, a crucial feature of the A7 causing financial institutions to be exhibit typical money laundering
Network’s financial services unwitting accomplices. indicators, including transactions in
infrastructure is, and remains, its use of, In a typical A7 Network transaction, unusually high volumes shortly after the
and reliance on, its Sub-Agents, offering the A7 Network customer satisfies its company is formed, inconsistencies
the A7 Network and its clients a means payment obligation through the A7 between goods descriptions and
of obfuscating the involvement of Network’s internal settlement system, supplier business profiles, unusual
Russian or other sanctioned actors in while a Sub-Agent located outside of payment routing through A7 Network-
payments that appear to financial Russia appears as the contracting or controlled companies, and falsified or
institutions as ordinary commercial paying party on invoices, sales AI-altered invoices.36
activity. agreements, and payment instructions to FinCEN assesses that the layer of
the ultimate supplier of a good. In obfuscation provided by Sub-Agents has
1. The A7 Network’s Sub-Agents essence, this is a form of trade-based enabled the A7 Network to circumvent
Although the core operations of the money laundering that leverages Sub- U.S. sanctions and anti-money
A7 Network are directed by A7 LLC and Agents, falsified trade documents, false laundering and countering the financing
its subsidiaries, working with and import-export records, and misleading of terrorism (AML/CFT) controls,
through several Russia- and Kyrgyz goods descriptions. In many cases, tainting the global financial system with
Republic-based businesses and digital funds may be transferred between billions in illicit funds stemming from,
asset exchanges, the A7 Network’s Sub- multiple Sub-Agents to create additional among other activities, Russian and
Agents are a critical element within the layers of obfuscation before arriving at Iranian sanctions evasion.
Network’s financial services the final destination.32 Through this
2. The A7 Network’s Use of Financial
infrastructure, allowing the Network to process, the Sub-Agents provide the A7
Instruments Facilitates Illicit Cross-
obfuscate the source and parties to Network with access to correspondent
Border Trade
transactions, to access foreign banking relationships, access to the
SWIFT network, and foreign-currency In a typical fiat transaction, the A7
currencies, to make payments appear as
liquidity, enabling it to transmit value Network facilitates international trade
ordinary commercial activity, and to
through the international financial through extensive use of financial
circumvent applicable sanctions and
system without a Russian customer instruments, including bills of exchange
other restrictions. or promissory notes (referred to as
As noted above, shortly after its appearing in the payment chain.33
While funds are typically moved veksels in Russian), that record value
establishment, the A7 Network began
between companies by Moscow-based inside the Network. Specifically, an A7
aggressively expanding into new
A7 Network personnel, the A7 Network Network customer provides the A7
jurisdictions and forming Sub-Agents,
leverages Virtual Private Networks Network with information necessary to
with the first Sub-Agents established in
(VPNs) to create the illusion that these execute the transaction, which may
Kyrgyz Republic, followed by expansion
individuals are located outside of Russia include supplier information and trade
across Central and East Asia, Africa,
and obscuring the connection between documentation. The A7 Network then
Europe, and the Middle East.30 As of satisfies its customer’s payment
Russia and the Sub-Agents.34 These
June 2026, the A7 Network has created obligation through A7 Network-
VPNs typically depend on infrastructure
or acquired hundreds of Sub-Agents, controlled settlement mechanisms that
with bank accounts at approximately 31 See Open Source Centre, The Big Shor: A7 and record value inside the Network.37
435 financial institutions in at least 83 the Illusion of Russian Financial Innovation (2026), Between September 30, 2024 and July
countries. at p. 33, https://static.opensourcecentre.org/assets/
To establish the Sub-Agents, the A7 osc_a7_big_shor.pdf.
35 See Open Source Centre, The Big Shor: A7 and
32 A7 Abroad: How A7 Sells International
Network forms, acquires, or partners the Illusion of Russian Financial Innovation (2026),
Sanctions Evasion as a Service (Oct. 2025), at p. 16,
with companies in third countries— https://www.info-res.org/app/uploads/2025/10/A7- at pp. 26, 39, https://static.opensourcecentre.org/
such as Hong Kong, Indonesia, the Abroad-FINAL-Copy.pdf. assets/osc_a7_big_shor.pdf.
36 See Alexander Osipovich, ‘‘Russia’s Hottest
Kyrgyz Republic, the Seychelles, 33 Open Source Centre, The Big Shor: A7 and the
illusion of Russian financial innovation (2026), at Startup Is a State-Backed Sanctions Evasion
Türkiye, and the United Arab Emirates Network,’’ The Wall Street Journal (Aug. 7, 2026).
pp. 41–42, https://static.opensourcecentre.org/
For more information about the use of AI to alter
lotter on DSK8BHNXB4PROD with PROPOSALS1
assets/osc_a7_big_shor.pdf.
jurisdiction and institutions operating in the 34 See Centre for Information Resilience, A7A5: or generate fraudulent documents in furtherance of
jurisdiction, that the purposes of this subchapter Circumventing sanctions with stablecoin illicit finance schemes, see FinCEN, FIN–2024–
continue to be fulfilled, and to guard against cryptocurrency (June 25, 2025), at p. 15, https:// Alert004, ‘‘FinCEN Alert on Fraud Schemes
international money laundering and other financial www.info-res.org/app/uploads/2025/06/A7A5- Involving Deepfake Media Targeting Financial
crimes. Report-June-2025-Final-Draft-1.pdf; Open Source Institutions’’ (Nov. 14, 2024), at pp. 3–5.
30 Open Source Centre, The Big Shor: A7 and the 37 See Open Source Centre, The Big Shor: A7 and
Centre, The Big Shor: A7 and the Illusion of Russian
Illusion of Russian Financial Innovation (2026), at Financial Innovation (2026), at pp. 28, 68, https:// the Illusion of Russian Financial Innovation (2026),
pp. 25–26, https://static.opensourcecentre.org/ static.opensourcecentre.org/assets/osc_a7_big_ at pp. 30–31, https://static.opensourcecentre.org/
assets/osc_a7_big_shor.pdf. shor.pdf. assets/osc_a7_big_shor.pdf.
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Federal Register / Vol. 91, No. 191 / Monday, October 5, 2026 / Proposed Rules 63213
22, 2025, the A7 Network’s clients The A7 Network also reportedly restricted or less dependable.48 Kyrgyz
purchased more than 3,200 bills of maintains reserves of currency in Republic-registered, OFAC-sanctioned
exchange worth the equivalent of more foreign bank accounts, to pay digital assets firm Old Vector LLC
than USD 25 billion, indicating that individuals and entities outside of worked with digital assets exchange
there is robust demand for A7 Network’s Russia without the need for cross-border Garantex, Garantex’s successor
services.38 These bills of exchange are transactions. The A7 Network keeps exchange Grinex, and others in the
purchased by companies and traders— records of the money it receives from its creation, issuance, and trading of the
becoming the customer’s credit within clients in Russia, and the money it A7A5 token.49 A7 Network created the
the system—and each purchase gets sends to external parties to maintain A7A5 stablecoin for Russian clients of
them on the A7 Network’s ledger, adequate funding on both sides of the OFAC-designated A7 LLC, a firm that
reducing the need to do direct border and balance the books, enabling provides cross-border settlement
international bank transfers and helping the Russian clients of the A7 Network platforms frequently used for sanctions
to avoid scrutiny by banks. The A7 to evade sanctions and avoid evasion.50 Although A7A5 is issued by
Network then assigns a foreign Sub- disruption.43 FinCEN assesses Kyrgyzstan-based Old Vector, each coin
Agent to appear as the contracting or transactions involving the A7 Network’s is backed by ruble deposits held at PSB,
paying party on invoices, sales Sub-Agents enable its clients to send or meaning for every A7A5 transaction,
agreements, and payment instructions. receive money to nearly any country there is a corresponding nexus to a
This enables the payment to be executed and in nearly any currency—including, sanctioned Russian bank.51
from non-Russian bank accounts U.S. dollars, yuan, dirhams, and euros— The A7A5 tokens are used to conduct
through correspondent banking and by using banks that have correspondent transactions outside of the formal
SWIFT channels.39 relationships with larger financial financial system. The token serves as an
In particular, the A7 Network has institutions that, but for obfuscation by internal accounting method for the
honed its process for executing the A7 Network, would not engage in network, moving across internal
international payments through these transactions, permitting illicit addresses to maintain a balanced ledger,
complex financial arrangements and its actors access to a money laundering effectively acting as part of a broader
constellation of enabling Sub-Agents. platform and decreasing the risk of this mirror system,52 to the international
The typical process requires a customer activity being identified by investigating
48 See U.S. Department of the Treasury, Press
to provide the A7 Network with authorities.44
Release, Treasury Sanctions Cryptocurrency
documentation outlining the foreign Using these settlement mechanisms, Exchange and Network Enabling Sanctions Evasion
counterparty requiring payment and the A7 Network’s clients have and Cyber Criminals (Aug. 14, 2025), https://
attendant bank details, description of reportedly been able to transact with home.treasury.gov/news/press-releases/sb0225.
the goods being bought, and price. The counterparties in Africa, Asia, Europe, 49 Garantex, which had been previously
A7 Network then matches the intended North America, and South America sanctioned as a prolific money launderer for
Russian cybercriminals and other illicit actors,
transaction with a relevant Sub-Agent in despite the restrictive sanctions on executed a scheme to move its funds to a successor
its global network, many of which are Russian banks.45 exchange, Kyrgyzstan-based Grinex, following
industry-specific to provide plausible disruptive action by U.S. law enforcement in March
3. The A7 Network’s Creation and Use 2025. Garantex allowed its customers who lost their
cover for transactions.40 These Sub-
of the A7A5 Stablecoin funds following the law enforcement disruptions to
Agents do not have any Russians on the regain access to their accounts using the A7A5
board of directors or as shareholders In parallel with its fiat settlement token. See Treasury Press Release, ‘‘Treasury
and their bank accounts are managed by mechanism, the A7 Network may use Sanctions Russia-Based Hydra, World’s Largest
A7 Network staff in Russia via VPNs, all digital assets, including A7A5, a ruble- Darknet Market, and Ransomware-Enabling Virtual
Currency Exchange Garantex’’ (Apr. 5, 2026); see
to appear as if the companies are being backed stablecoin that operates on the also Aug. 2025 Treasury Press Release, supra note
operated from within the country of Tron and Ethereum blockchains,46 47 to 2. See also Etherscan, Contract, ‘‘Token A7A5’’
registration.41 The A7 Network then transfer value across A7 Network-linked (accessed Aug. 17, 2026).
uses software that generates fake actors where banking channels are 50 U.S. Department of the Treasury, Press Release,
Treasury Sanctions Cryptocurrency Exchange and
invoices and trade documents to make Network Enabling Sanctions Evasion and Cyber
the transactions seem legitimate— 43 Id. at p. 46.
Criminals (Aug. 14, 2025), https://
including by stripping any reference to 44 Id. at pp. 52–53.
home.treasury.gov/news/press-releases/sb0225;
45 Open Source Centre, The Big Shor: A7 and the A7A5, Homepage, https://www.a7a5.kg/trade_and_
Russia.42
illusion of Russian financial innovation (2026), at earn?chain=tron%3Flang%3Den. https://
pp. 25, 34, 37,https://static.opensourcecentre.org/ www.a7a5.kg/trade_and_
38 Id. at pp. 30–31.
assets/osc_a7_big_shor.pdf. earn?chain=tron%3Flang%3Den.
39 Id., at. pp. 32–34. Several sanctioned Russian 46 The A7A5 tokens operate from smart contracts 51 A7A5, Why A7A5, at p. 1, https://
financial institutions were removed from the with addresses at 0x6fA0BE17e4beA2fCfA22 www.a7a5.kg/why_a7a5; Chainalysis, How A7A5
SWIFT system in March 2022 shortly after its full- ef89BF8ac9aab0AB0fc9 and TLeVfrdym8RoJre and Grinex Enable The Russian Shadow Crypto
scale invasion of Ukraine, making it significantly J23dAGyfJDygRtiWKBZ. See https://etherscan.io/ Economy (Aug. 14, 2025), at pp. 2–3, https://
harder for Russian financial institutions to conduct token/0x6fA0BE17e4beA2fCfA22ef89BF8ac www.chainalysis.com/blog/a7a5-grinex-russian-
cross-border transactions. See SWIFT, ‘‘An update 9aab0AB0fc9#code; https://tronscan.org/token20/ crypto-economy-ofac-sanctions-august-2025/.
to our message for the Swift Community’’ (Mar. 20, TLeVfrdym8RoJreJ23dAGyfJDygRtiWKBZ/code. 52 The term ‘‘mirror transactions’’ or ‘‘mirror
2022), https://www.swift.com/news-events/news/ 47 Stablecoins are a type of digital asset for which transfer’’ is used by U.S. law enforcement to
message-swift-community. the value of the token is tied to another asset, describe a money laundering typology involving
40 Open Source Centre, The Big Shor: A7 and the
typically a fiat currency such as the U.S. dollar. foreign currency exchange. The process typically
illusion of Russian financial innovation (2026), at Stablecoins are appealing to illicit actors due to happens within Chinese underground banking and
p. 41, https://static.opensourcecentre.org/assets/ their relative liquidity, ease of settlement, and black market peso exchange schemes and usually
lotter on DSK8BHNXB4PROD with PROPOSALS1
osc_a7_big_shor.pdf. The A7 Network’s Sub-Agents exchange rate stability. See U.S. Department of the involves a money broker or an accountant who
are tailored, insofar as it is possible, to the Treasury, 2026 National Proliferation Financing conducts two equal, but separate, transactions
industries for which they are moving payments to Risk Assessment (Mar. 2026), at p. 16, https:// involving at least two parties who often are
avoid scrutiny from financial institutions. However, home.treasury.gov/system/files/246/2026- unaware of each other. In this scheme, the broker
there are some indications that the A7 Network at NPFRA.pdf; see also U.S. Department of the or accountant makes payments to each party using
times struggles to match Sub-Agents with specific Treasury, 2026 National Money Laundering Risk the other parties’ currency, ‘‘mirroring’’ or
customer business profiles. Id. at p. 20. Assessment (Mar. 2026), at pp. 52–53, https:// balancing the transactions. In the instance of the A7
41 Id. at pp. 33, 39.
home.treasury.gov/system/files/246/2026- Network, transactions within Russia using the
42 Id. at pp. 41–42. NMLRA.pdf. Continued
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63214 Federal Register / Vol. 91, No. 191 / Monday, October 5, 2026 / Proposed Rules
payments that the network makes.53 the necessary liquidity to operate, the are often accessed through decentralized
This broader mirror system also A7 Network uses its Sub-Agents or other finance applications.61
involves the use of the aforementioned trusted intermediary entities, such as The A7 Network’s well-established
bills of exchange, known as ‘‘veksels’’. digital asset exchanges. This includes and far-reaching digital asset channels
According to public and nonpublic over-the-counter digital asset brokers are an appealing tool for a wide range
information, the tokens are used for (OTCs) 58 outside of Russia operating in of threat actors. Analysis of public and
transfers within Russia that represent jurisdictions of concern for A7 Network nonpublic information reveals that
foreign payments and are made through activity—especially firms that are newly Iranian actors are leveraging the A7
nested digital asset wallets and financial created or dramatically expanding their Network, including the Central Bank of
accounts held in the name of A7 stablecoin trading operations—which Iran and the IRGC. Other illicit actors
Network Sub-Agents. On the other side could serve as A7 Network liquidity known to have used this network
of the mirror trading system, the A7 providers.59 In addition, FinCEN include North Korea (DPRK); Iran-
Network employs its Sub-Agents to backed terrorist organizations;
analysis indicates that U.S. financial
conduct fiat transactions—including cybercriminals and ransomware
institutions may encounter use of
U.S. dollars, yuan, dirhams, and euros— actors.62
derivative or ‘‘wrapped’’ tokens distinct 4. The A7 Network’s Sub-Agents Are
through the international financial from but ‘‘pegged’’ to the A7A5 token
system. FinCEN, through analysis of Used in Furtherance of International
that serve as a representation of the Money Laundering and Sanctions
available financial data, found that more A7A5 token on a blockchain to which
than 180 entities processed A7A5 Evasion in Connection With Russian
A7A5 is not native; 60 wrapped tokens Illicit Finance
transactions worth at least USD 179.1
billion, between February 2025 and June As demonstrated above, the A7
2026. Historically, almost all of these
; see also Elliptic, ‘‘The fall of A7A5: how sanctions Network’s Sub-Agents play a key role in
strangled the ruble stablecoin’’ (July 29. 2026), enabling, and facilitating, the A7
transactions were processed through Centre for Information Resilience ‘‘A7A5:
U.S.-, EU-, and/or UK-sanctioned Circumventing sanctions with stablecoin Network’s activities. Based on analysis
entities, including Garantex and Grinex, cryptocurrency’’ (June 25, 2025), at p. 9, https:// of public and nonpublic information,
www.info-res.org/app/uploads/2025/06/A7A5- FinCEN assesses that, in the aggregate,
and likely involved touchpoints with Report-June-2025-Final-Draft-1.pdf. the A7 Network’s Sub-Agents have
Russian banks; 54 however following an 58 OTCs are money services businesses (MSBs)
processed more than 17 billion in USD-
alleged hack of Grinex in April 2026,55 that conduct peer-to-peer exchanges of digital assets
for fiat currency, or digital assets for digitals assets, denominated transactions between
A7A5 has been consolidated into
between two parties without the use of a centralized January 2025 and June 2026. Moreover,
unhosted wallets, suggesting the A7 digital asset exchange and usually involving large FinCEN has identified and assessed
Network may be moving away from volumes. As part of the money laundering process, hundreds of Sub-Agents of the A7
using sanctioned exchanges.56 illicit actors often seek to convert digital assets,
specifically stablecoins, into fiat currency via Network, finding that, based on public
The A7 Network has most often used
diffuse networks of OTC brokers in third countries. and nonpublic information, these Sub-
the A7A5 tokens as a non-freezable, These OTCs can receive substantial fees from illicit Agents have (1) extensively facilitated
bridging asset to convert into other, actors for providing cash-out services that leverage transactions on behalf of, and for the
more widely accepted digital assets, proxy accounts to circumvent digital asset service
benefit of, sanctioned Russian persons;
such as the stablecoin Tether (USDT), providers’ Customer Due Diligence (CDD) processes
or exploit providers with weaker AML/CFT (2) supported Russia’s military
and which may then be converted to the controls, among other tactics. See U.S. Department operations in Africa; (3) enabled Iranian
fiat currency of the customers choosing of the Treasury, 2026 National Money Laundering sanctions evasion, including
as another means of settling payments Risk Assessment (Mar. 2026), at p. 50, https://
transactions involving entities involved
internationally.57 In order to maintain home.treasury.gov/system/files/246/2026-
NMLRA.pdf. in the ‘‘shadow fleet’’ that Iran uses to
59 The A7A5 token is only available for purchase illicitly sell oil; and (4) assisted at least
A7A5 token ‘‘mirror’’ movements of fiat currency
through ‘‘Sub-Agents,’’ balancing the transactions
on a small number of exchanges, most of which are one company involved in procurement
sanctioned by the U.S., EU and/or UK; however, it for Iran’s weapons programs.
while ensuring that the counterparties remain
is also traded using peer-to-peer exchangers and
completely firewalled from one another. See
decentralized exchanges. See Centre for Information
For instance, publicly identified 63
Treasury, ‘‘2024 National Money Laundering Risk Sub-Agents that FinCEN assesses
Resilience ‘‘A7A5: Circumventing sanctions with
Assessment’’ (Feb. 2024), at pp. 29–30. For more
information about Chinese underground banking
stablecoin cryptocurrency’’ (June 25, 2025), at pp. engaged in illicit activity include:
and the black market peso exchange, see FinCEN,
12–13, https://www.info-res.org/app/uploads/2025/ • Power Sphere LLC–FZ. Power
06/A7A5-Report-June-2025-Final-Draft-1.pdf. Sphere LLC–FZ is a Dubai, UAE-based
FIN–2025–A003, ‘‘FinCEN Advisory on the Use of 60 A ‘‘wrapped’’ token is a digital asset that
Chinese Money Laundering Networks by Mexico-
represents another digital asset on a non-native
electronics supplier that purportedly
Based Transnational Criminal Organizations to trades in energy products, agricultural
Launder Illicit Proceeds’’ (Aug. 28, 2025). blockchain where the original asset is not offered.
53 See June 2026 TRM Labs Report, supra note 12. For example, a ‘‘wrapped’’ A7A5 token may offer products, consumer goods, and food and
54 See TRM Labs, ‘‘The A7 Leaks: TRM’s On-
trading of a representation of A7A5 on a blockchain beverages.64 However, FinCEN’s
other than A7A5’s native blockchains. Wrapped
Chain Analysis of Russia’s Cryptocurrency tokens maintain a peg to the original asset, which
Connections’’ (June 12, 2026), https:// 61 See Ethereum Foundation, ‘‘Wrapped ether
is traditionally locked by a smart contract or
www.trmlabs.com/resources/blog/the-a7-leaks-trms- maintained in a digital vault. See Securities and (WETH),’’ https://ethereum.org/wrapped-eth/ (last
on-chain-analysis-of-russias-cryptocurrency- Exchange Commission and Commodity Futures accessed Aug. 20, 2026).
connections. Trading Commission, 17 CFR parts 231 RIN 3235–
62 See TRM Labs, ‘‘The A7 Leaks: TRM’s On-
55 See Elliptic, ‘‘The fall of A7A5: how sanctions Chain Analysis of Russia’s Cryptocurrency
AN56 and 241 and 17 CFR part 1 RIN 3038–AF67,
strangled the ruble stablecoin’’ (July 29. 2026), ‘‘Application of the Federal Securities Laws to Connections’’ (June 12, 2026), https://
https://www.elliptic.co/insights/the-fall-of-a7a5- Certain Types of Crypto Assets and Certain www.trmlabs.com/resources/blog/the-a7-leaks-trms-
how-sanctions-strangled-the-ruble-stablecoin/. Transactions Involving Crypto Assets’’ (Mar. 23, on-chain-analysis-of-russias-cryptocurrency-
lotter on DSK8BHNXB4PROD with PROPOSALS1
56 See Hannah Curtis, ‘‘One wallet now holds
2026), https://www.sec.gov/files/rules/interp/2026/ connections.
94.5% of A7A5’s supply,’’ Crystal Intelligence (July 63 All of the Sub-Agents discussed below were
33-11412.pdf. Wrapped tokens may also be created
30, 2026), https://crystalintelligence.com/ on the same blockchain as the original token to identified as Sub-Agents of the A7 Network. See
stablecoin/one-wallet-now-holds-94-5-of-a7a5s- make them compatible with decentralized Centre for Information Resilience, A7 Abroad: How
supply/. exchanges. See Centre for Information Resilience A7 Sells International Sanctions Evasion as a
57 See Elliptic, ‘‘A7A5: The ruble-backed ‘‘A7A5: Circumventing sanctions with stablecoin Service (Oct. 2025), at pp. 19–20, https://www.info-
stablecoin crosses $100 billion in transactions’’ (Jan. cryptocurrency’’ (June 25, 2025), at p. 13, https:// res.org/app/uploads/2025/10/A7-Abroad-FINAL-
21, 2026), https://www.elliptic.co/insights/a7a5-the- www.info-res.org/app/uploads/2025/06/A7A5- Copy.pdf.
ruble-backed-stablecoin-100-billion-in-transactions/ Report-June-2025-Final-Draft-1.pdf. 64 Id. at p. 19.
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Federal Register / Vol. 91, No. 191 / Monday, October 5, 2026 / Proposed Rules 63215
analysis of public and non-public illicit funds tied to Russian export B. The Extent to Which Transactions
information identified that between control evasion. Involving any Sub-Agent of the A7
September 2023 and July 2025, Power • Sigizmund FZCO. Sigizmund FZCO Network Involve Legitimate Business
Sphere LLC–FZ processed USD 61 is a Dubai, UAE-based marketing Activity
million in illicit funds tied to Russian management, research, and support In reaching its finding, FinCEN has
trade-based money laundering and considered the extent to which
consultancy firm.70 FinCEN’s analysis
procurement activities in the energy transactions involving any Sub-Agent
of public and non-public information
sector. are used for legitimate business
• Hydrofusion Resources FZ–LLC. determined that between July and
September 2025, Sigizmund FZCO purposes.72 As discussed above, the A7
Hydrofusion Resources FZ–LLC is a Network’s Sub-Agents are used to
UAE-based energy commodities trader processed USD 41,000 in illicit funds
facilitate illicit activities by illicit actors.
that also purportedly trades in various tied to Russian sanctions evasion,
Although some components of the A7
other products, such as food and including the acquisition of dual-use
Network, including its known Sub-
beverages, electronics, and heavy goods. Agents, may offer services that could
machinery.65 FinCEN’s analysis of • Pearl Bridge. Pearl Bridge is a potentially be used by licit actors, the
public and non-public information Dubai, UAE-based trading firm that A7 Network’s own creators,
determined that between May and June purportedly specializes in precious acknowledge its services are expressly
2025, Hydrofusion Resource FZ–LLC metals, commodities, and other general designed to circumvent U.S. and
processed USD 3.6 million in illicit trade.71 FinCEN’s analysis of public and international sanctions placed on the
funds tied to Russian trade-based money non-public information determined that operators, owners, and enablers of the
laundering activity. in April 2025, Pearl Bridge processed A7 Network 73 and licit actors would
• Gimli Trade LLC–FZ. Gimli Trade have access to other, more established
approximately USD 30,000 in illicit
LLC–FZ is a Dubai, UAE-based trading channels through which they might
funds tied to suspected Russian
firm that purportedly trades in food and direct financial activity. Accordingly,
sanctions evasion activity.
beverages, household goods, cosmetic given the extensive flow of illegitimate
products, machinery, oil trading, and Additionally, based on analysis of funds through the A7 Network, FinCEN
general trading.66 The company public and nonpublic information, there assesses that the need to protect U.S.
maintained an account at PSB in Russia, are indications that certain Sub-Agents financial institutions from the money
which was used to make ruble- have facilitated Iranian sanctions laundering risks presented by the A7
denominated transactions.67 Gimli evasion efforts. One Sub-Agent engaged Network outweighs any potential
Trade LLC–FZ was sanctioned by the in direct transactions with other Sub- legitimate utility its services may
United Kingdom on December 18, 2025, Agents and entities associated with provide.
for its involvement in providing Iran’s shadow fleet—a network of oil
financial support to the Russian C. The Extent to Which This Proposed
tankers, shipping companies, and front Action Would Guard Against the Risks
government.68 FinCEN’s analysis of companies used to transport and sell
public and non-public information Posed by Transactions Involving any
Iranian oil—indicating that Iranian Sub-Agent of the A7 Network
determined that between May and June
actors have used the A7 Network and its A finding that transactions involving
2025, Gimli Trade LLC–FZ processed
infrastructure, including its Sub-Agents, any Sub-Agent of the A7 Network are a
USD 1.5 million in illicit funds tied to
Russian sanctions evasion. in connection with sanctions-evasion class of transactions of primary money
• Galadriel Trading FZCO. Galadriel activity. Between July 2023 and October laundering concern in connection with
Trading FZCO is a Dubai, UAE-based 2025, the same A7 Sub-Agent and one Russian illicit finance establishes—and
agricultural trading firm that of its sister companies received nearly emphasizes—the significant illicit
purportedly trades commodities such as USD 140 million from entities involved finance risks posed by the A7 Network
wheat, corn, barley, chickpeas, and in Iranian sanctions evasion. In a and its Sub-Agents. This finding will
vegetable oils.69 FinCEN’s analysis of separate instance, based on public and place U.S. and foreign financial
public and non-public information nonpublic information, FinCEN assess institutions and regulators on notice to
determined that between May and July that another A7 Network Sub-Agent guard against those risks.74 Moreover, as
2025, Galadriel Trading FZCO transferred approximately USD 1.6 Sub-Agents of the A7 Network are, by
processed more than USD 946,000 in million, between January 2024 and design, challenging to readily identify,
September 2025, to a company linked to such a finding—in combination with a
65 Id. at p. 20.
Iranian sanctions evasion and weapons prohibition on certain transmittals of
66 Centre for Information Resilience, A7 Abroad:
procurement efforts. funds by covered financial
How A7 Sells International Sanctions Evasion as a institutions—will safeguard the U.S.
Service (Oct. 2025), at p. 20, https://www.info- Across fiat and digital asset-based financial system, by assisting financial
res.org/app/uploads/2025/10/A7-Abroad-FINAL- settlement mechanisms, the A7
Copy.pdf. institutions in identifying Sub-Agent
67 Open Source Centre, The Big Shor: A7 and the Network’s well-established and far- and severing access.
illusion of Russian financial innovation (2026), at reaching constellation of Sub-Agents
p. 34, https://static.opensourcecentre.org/assets/ have provided a tool for threat actors to IV. Proposed Special Measure
osc_a7_big_shor.pdf. engage in a wide array of illicit activity, Having found that transactions
68 UK Foreign, Commonwealth and Development
Office, Gimli Trade LLC–FZ (Dec. 18, 2025), https:// including sanctions evasion. involving any Sub-Agent of the A7
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search-uk-sanctions-list.service.gov.uk/
72 See 31 U.S.C. 5318A(c)(2)(B)(ii).
designations/RUS3177/Entity?utm_content=&utm_
medium=email&utm_name=&utm_ 73 Kommersant, Investment Cooperation Between
70 Centre for Information Resilience, A7 Abroad:
source=govdelivery. Russia and China: Growth Points. Kommersants
69 Centre for Information Resilience, A7 Abroad:
How A7 Sells International Sanctions Evasion as a Session at the Third Russia-China International
How A7 Sells International Sanctions Evasion as a Service (Oct. 2025), at p. 19, https://www.info- Forum (Aug. 19, 2025), at p. 2, https://
Service (Oct. 2025), at p. 19, https://www.info- res.org/app/uploads/2025/10/A7-Abroad-FINAL- www.events.kommersant.ru/events/sessiya-na-
res.org/app/uploads/2025/10/A7-Abroad-FINAL- Copy.pdf. rostki-2025.
Copy.pdf. 71 Id. 74 See 31 U.S.C. 5318A(c)(2)(B)(iii).
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63216 Federal Register / Vol. 91, No. 191 / Monday, October 5, 2026 / Proposed Rules
Network are a class of transactions of action is specifically designed to insulate the U.S. financial system from
primary money laundering concern in address a significant money laundering international money laundering and
connection with Russian illicit finance, threat to the U.S. and international other financial crimes, further ongoing
FinCEN proposes imposing a financial systems premised on the U.S. efforts to curtail suspected
prohibition on certain transmittals of Secretary’s determination that sanctions evasion and related illicit
funds involving any of the A7 Network’s transactions involving any Sub-Agent of activity tied to Russian and Iranian
Sub-Agents.75 In making this the A7 Network poses an unacceptable illicit finance, and sever a significant
determination and assessing which risk of money laundering and other pathway that facilitates circumvention
special measures may be appropriate, financial crimes. of U.S. and other sanctions, supporting
FinCEN has considered the relevant Further, this action is intended to the efficacy of U.S. sanctions and
evidence in light of factors identified in encourage other jurisdictions—as well complementing previous actions taken
31 U.S.C. 5318A(a)(4)(B). While FinCEN as financial institutions throughout the by the U.S. government.
is under no obligation pursuant to world—to take similar steps to sever the
A7 Network and its Sub-Agents from the B. Whether the Proposed Special
section 9714(a) to consider any
international financial system. Measure Would Create Undue Burdens
particular factor or set of factors in
Notwithstanding the differing on Any Legitimate Activity of the A7
selecting one or more special measures,
purposes of the existing sanctions and Network’s Sub-Agents or Third Parties
it nonetheless finds these factors
instructive in guiding the analysis set the special measure proposed in this FinCEN has considered whether the
forth below.76 NPRM, the proposed special measure is proposed prohibition on certain
As noted above, OFAC has not only intended to apply in concert, not transmittals of funds would create a
designated the A7 Network as a conflict with the existing sanctions. significant competitive disadvantage,
significant TCO, but also designated, Covered financial institutions should including any undue cost or burden
and imposed restrictions upon, certain block and report to OFAC any accounts associated with compliance, for
core actors and components of the A7 or transactions that are blocked financial institutions organized or
Network—namely, A7 LLC, A71 LLC, pursuant to any applicable OFAC licensed in the United States as affected
A7 Agent LLC, Old Vector LLC, sanctions authority, and to the extent third parties, as well as the extent to
Garantex, Grinex, InDeFi Bank, ExVed, required or necessary, continue to which the action could have a
Mendeleev, Ilan Shor, and PSB, as well maintain any blocked accounts in significant adverse systemic impact on
as certain other persons whose property accordance with the Reporting legitimate business activities involving
and interests in property have been Procedures and Penalties Regulations, the A7 Network’s Sub-Agents. As noted
blocked, by designation, order, or by 31 CFR part 501. And, for avoidance of above, FinCEN assesses that to the
operation of law. The proposed doubt, if there is an apparent conflict extent the A7 Network Sub-Agents are
imposition of a special measure would between an obligation to block property engaged in licit activity, such activity is
reinforce those existing restrictions, and or interests in property under existing relatively minimal compared to the
importantly, the purposes served by this OFAC sanctions and the requirements of sanctions evasion and illicit financial
proposed action differ from the this proposed special measure, covered activity that flows through these Sub-
purposes of the existing economic financial institutions should comply Agents. Moreover, these Sub-Agents
sanctions. Apart from the rationale and with the obligation to block and, in operate companies in a variety of
purposes of the existing sanctions, this doing so, would be deemed to comply industries and the disperse nature of
with the requirements of this proposed these businesses underscores that any
75 In connection with this action, and consistent special measure. overall impacts from any decrease in
with 31 U.S.C. 5318A(a)(4)(A), FinCEN consulted legitimate commercial or financial
with staff at the following Departments and A. Whether the Proposed Special
activity by these Sub-Agents is likely de
agencies with regard to the proposed rule and Measure Would Address the Money
prohibition: the Department of Justice; the minimis.
Laundering Concern in a Manner When considering the anticipated
Department of State; the Board of Governors of the
Federal Reserve System; the Federal Deposit
Consistent With U.S. National Security burden on covered financial
Insurance Corporation; the Securities and Exchange and Foreign Policy Interests institutions, FinCEN assesses that the
Commission; the Commodity Futures Trading
Commission; the Office of the Comptroller of the
FinCEN has considered the effect this proposed prohibition is unlikely to
Currency; and the National Credit Union proposed special measure will have on impose a significant competitive
Administration. Neither the Departments nor U.S. national security and foreign disadvantage on any one particular
agencies objected to the issuance of this NPRM policy, as well as the extent to which financial institution organized or
based on the information provided to staff at the
time of this consultation.
multilateral groups or other nations licensed in the United States as a
76 31 U.S.C. 5318A(a)(4)(B) provides, as relevant have taken similar action.77 Given that consequence of business forgone due to
here, that in selecting which special measure(s) to the A7 Network’s Sub-Agents’ the proposed prohibition given that the
take, the Secretary shall consider: association with sanctioned persons and A7 Network’s Sub-Agents uses of
(1) Whether similar action has been or is being other actors involved in illicit activity, hundreds of Sub-Agents across a wide
taken by other nations or multilateral groups; number of financial institutions,
for the purpose of furthering sanctions
(2) Whether the imposition of any particular
special measure would create a significant evasion, FinCEN assesses that imposing globally. Further, compliance with the
competitive disadvantage, including any undue cost a prohibition on certain transmittals of proposed prohibition on certain
or burden associated with compliance, for financial funds involving the A7 Network’s Sub- transmittals of funds set out in this
institutions organized or licensed in the United Agents is necessary to safeguard U.S. NPRM should not require tools or
States;
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national security and the U.S. financial competencies other than those already
(3) The extent to which the action or the timing
of the action would have a significant adverse system, as well as serve key U.S. employed by domestic financial
systemic impact on the international payment, national security objectives. institutions to maintain their current
clearance, and settlement system, or on legitimate Specifically, prohibiting certain AML/CFT compliance programs and/or
business activities involving the particular sanctions compliance programs. To
jurisdiction, institution, class of transactions, or
transmittals of funds involving any of
type of account; and the A7 Network’s Sub-Agents would ensure that minimal additional burden
(4) The effect of the action on United States would attach to compliance with the
national security and foreign policy. 77 See 31 U.S.C. 5318A(a)(4)(B)(i), (iv). proposed rule, FinCEN has elected to
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Federal Register / Vol. 91, No. 191 / Monday, October 5, 2026 / Proposed Rules 63217
provide for the rejection of certain processing transmittals of funds evasion through the A7 Network’s Sub-
transmittals of funds that are received involving the A7 Network’s Sub-Agents. Agents, and to prevent the A7 Network’s
from or originate with A7 Network Sub- Those special measures would allow Sub-Agents from using the U.S.
Agents and outline the steps a covered such transfers to continue to benefit financial system to enable illicit
financial institution should take in such illicit actors connected to Russian illicit financial activity. The subsections
circumstances to satisfy the proposed finance and Iranian sanctions evasion. below discuss the respective portions of
requirements. Further, upon issuance of Further, prohibiting or placing the proposed rule, which is separately
a Final Rule, FinCEN is prepared to aid conditions upon the opening or presented in Section IX. Importantly,
covered financial institutions in maintaining in the United States of nothing in this NPRM should be
compliance with this NPRM, by correspondent accounts or payable- construed to modify, impair, or
providing additional information through accounts for or on behalf of the otherwise affect any requirements or
regarding known Sub-Agents, as A7 Network’s Sub-Agents, as described obligations to which a covered financial
appropriate, through a secure in 31 U.S.C 5318A(b)(5) would be institution is subject pursuant to the
communications channel and proposes similarly inadequate. Neither BSA, including, but not limited to, the
to limit the obligation on covered prohibiting nor imposing conditions on filing of Suspicious Activity Reports, or
financial institutions to prohibit certain such accounts would safeguard the U.S. other applicable laws or regulations,
transmittals to only those entities on the financial system to the same degree as such as the sanctions administered and
provisioned list(s), which may be prohibiting transmittals of funds, as enforced by OFAC.
updated over time, as FinCEN, for such a special measure would not
A. Definitions
instance, identifies additional Sub- address the movement of funds outside
Agents. of a strict correspondent or payable- 1. A7 Network
through relationship, for example, The term ‘‘A7 Network’’ means the
C. Whether Any Other Reasonable
through the movement of funds outside core grouping of entities and persons
Alternatives or Special Measures Would
the traditional banking relationship, involved in the operation of a Russian-
Adequately Address the Money
including because the types of CVC Kyrgyzstan based sanctions evasion and
Laundering Concern
transactions, namely A7A5-related money laundering network including:
In assessing the appropriate special transactions (which are an integral part A7 LLC, A71 LLC, A7 Agent LLC, Old
measure to impose, FinCEN considered of the A7 Network’s business model), do Vector LLC, Garantex, Grinex, InDeFi
alternatives to a prohibition on certain not rely on the correspondent banking Bank, Mendeleev, Ilan Shor, and PSB,
transmittal of funds, including the system. FinCEN therefore assesses that and any other persons whose property
imposition of one or more of the first such a prohibition is the most and interests in property have been
five special measures. Having appropriate special measure to protect blocked, by designation, order, or by
considered these alternatives, FinCEN the U.S. financial system. operation of law, in light of their
assesses, for the reasons set out below,
D. Whether the Proposed Prohibition connection to the A7 Network.79
that a special measure prohibiting
certain transmittals of funds involving Should Be Imposed by Order or 2. A7 Network Sub-Agents
the A7 Network’s Sub-Agents is the Regulation
The proposed rule would define the
most appropriate means to adequately Pursuant to section 9714, the A7 Network Sub-Agents as including,
address the illicit finance risks posed by Secretary may impose specified special but not limited to, the following:
the A7 Network’s Sub-Agents and the measures, including a prohibition on Galadriel Trading FZCO, Gimli Trade
need to prevent it from accessing the certain transmittals of funds, ‘‘by order, LLC–FZ, Hydrofusion Resources FZ–
U.S. financial system. None of the regulation or otherwise as permitted by LLC, Pearl Bridge, Power Sphere LLC–
special measures set out in 31 U.S.C. law.’’ In determining the appropriate FZ, and Sigizmund FZCO, and any
5318A—special measures one through approach in this instance, FinCEN other entity identified by FinCEN as a
five—would effectively address the considered imposing special measures Sub-Agent of the A7 Network.
illicit finance threat posed by the A7 by order or regulation, taking into As suggested in this definition, to
Network’s Sub-Agents.78 Any additional account the nature of the underlying facilitate identifying entities that are
recordkeeping, information collection, threat, and determined that proceeding
or reporting requirements, as described by an NPRM is the most appropriate 79 Persons whose property and interests in
in 31 U.S.C 5318A(b)(1)–(4), would be course of action, as that approach property are blocked pursuant to an Executive
insufficient to guard against the risks Order or regulations administered by OFAC
appropriately balances the risks posed (blocked persons) are considered to have an interest
posed by covered financial institutions by the A7 Network, with the interest in in all property and interests in property of an entity
ensuring that covered financial in which such blocked persons own, whether
78 Likewise, imposing conditions on transmittals
institutions have an opportunity to individually or in the aggregate, directly or
of funds, pursuant to section 9714(a)(2), would be indirectly, a 50 percent or greater interest.
insufficient to address the threat. While imposing comment on the proposed mechanisms Consequently, any entity owned in the aggregate,
conditions, rather than a full prohibition, may be through which FinCEN will identify directly or indirectly, 50 percent or more by one or
appropriate in circumstances where the institution Sub-Agents (as discussed below). more blocked persons is itself considered to be a
provides services for legitimate business that are A copy of this NPRM will be blocked person. The property and interests in
not easily replicated or where a complete property of such an entity are blocked regardless of
prohibition on transactional activity would published in the Federal Register. To whether the entity itself is listed in the annex to an
otherwise unduly harm legitimate economic the extent the A7 Network’s Sub-Agents Executive order or otherwise placed on OFAC’s List
activity, the A7 Network’s Sub-Agents provide a or parties have information relevant to of Specially Designated Nationals. Accordingly, a
lotter on DSK8BHNXB4PROD with PROPOSALS1
service that, by design, is intended to benefit this NPRM, they may submit it to U.S. person generally may not engage in any
sanctioned persons. And, to the extent that the A7 transactions with such an entity, unless authorized
Network carries on any legitimate activity, FinCEN FinCEN at http://www.fincen.gov/ by OFAC. In certain OFAC sanctions programs (e.g.,
assesses that such services would be easily contact. Cuba and Sudan), there is a broader category of
obtainable for legitimate customers through other entities whose property and interests in property
providers. Accordingly, in this case the value of any V. Section-by-Section Analysis are blocked based on, for example, ownership or
legitimate activity it may conduct is outweighed by control. See OFAC, Revised Guidance on Entities
the significant proportion of illicit financial activity
The goal of this proposed rule is to Owned by Persons Whose Property and Interests in
identified and its lack of mandatory Know Your combat and deter illicit activity, Property are Blocked (Aug. 13, 2014), https://
Customer controls. including Russian and Iranian sanctions ofac.treasury.gov/media/6186/download?inline.
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63218 Federal Register / Vol. 91, No. 191 / Monday, October 5, 2026 / Proposed Rules
deemed Sub-Agents of the A7 Network, status. Despite having legal tender status institutions from declining CVC
FinCEN would be prepared to provide— in at least one jurisdiction, for the transfers originating at addresses
through secure means—covered purpose of this NPRM, the A7A5 outside of their control, and compliant
financial institutions with additional stablecoin is included as a type of CVC. institutions may find themselves in
information regarding known A7 Sub- receipt of CVC that, despite a desire and
4. Covered Financial Institution
Agents, as appropriate, and proposes effort to limit such exposure, would
limiting the obligation on covered The term ‘‘covered financial implicate the proposed prohibition.80
financial institutions to prohibit certain institution’’ has the same meaning as As such, proposed section
transmittals only as to those entities ‘‘financial institution’’ in 31 CFR 1010.668(b)(1)(i) allows covered
identified on that list. Specifically, 1010.100(t). financial institutions the flexibility to
FinCEN would share that list with 5. Transmittals of Funds act with discretion based on the facts
covered financial institutions through and circumstances of a particular
FinCEN’s ‘‘FI-Portal,’’ a secure The term ‘‘transmittals of funds’’ transaction and comply with the
messaging system that FinCEN and means the sending and receiving of proposed prohibition, even where the
covered financial institutions utilize to funds, including CVC. For avoidance of originating address is no longer
securely exchange information, as doubt, the definition of ‘‘transmittals of accessible. Moreover, by providing for
appropriate. That list will be updated funds’’ proposed here would only apply the rejection of CVC, this order ensures
periodically, both to add additional to section 1010.668. The definition of that covered financial institutions will
Sub-Agents as well as to remove Sub- transmittal of funds’’ in section not be subject to an undue cost or
Agents. Given the nature of the A7 1010.100(ddd) would not apply to burden associated with compliance.
Network and its operations (as section 1010.668. Further, as the proposed special
discussed above), FinCEN is opting to 6. Recipient measure is intended to apply in concert,
securely provide this list only to not conflict, with the existing sanctions,
The Term ‘‘Recipient’’ means the a note to proposed section
covered financial institutions, as
person to be paid by the recipient’s 1010.668(b)(1) provides that covered
FinCEN has assessed that a broader
covered financial institution. financial institutions should block and
public distribution of the list would
undermine the purposes of the proposed 7. Meaning of Other Terms report to OFAC any accounts or
rule—allowing the A7 Network to All terms used but not otherwise transactions that are blocked pursuant
circumvent the proposed special defined herein shall have the meaning to any applicable OFAC sanctions
measure through additional and new set forth in 31 CFR Chapter X, 31 U.S.C. authority, and to the extent required or
Sub-Agents. 5312, and 21 U.S.C. 2302. necessary, continue to maintain any
Importantly, as proposed in this blocked accounts in accordance with
NPRM, that list would identify known B. 1010.668(b)—Prohibition on Certain the Reporting Procedures and Penalties
Sub-Agents, for the purposes of Transmittals of Funds for Covered Regulations, 31 CFR part 501. As noted
compliance with the proposed special Financial Institutions above and for avoidance of doubt, if
measure, and covered financial 1. Prohibition on Certain Transmittals of there is an apparent conflict between an
institutions would only be prohibited Funds obligation to block property or interests
from engaging in certain transmittals of in property under existing OFAC
funds involving those Sub-Agents. Proposed section 1010.668(b)(1) sanctions and the requirements of this
Covered financial institutions would prohibits covered financial institutions proposed special measure, covered
not, however, be prohibited from from engaging in a transmittal of funds financial institutions should comply
disclosing that, in the context of any involving any A7 Network Sub-Agent, with the obligation to block and, in
particular transaction, they have including any transmittal of funds from doing so, would be deemed to comply
declined to proceed with the transaction or to an A7 Network Sub-Agent, or from with the requirements of this proposed
because of party has been identified on or to any account or CVC address special measure.
FinCEN’s list. Rather, as discussed administered by or on behalf of an A7
Network Sub-Agent. 2. Notification
below covered financial institutions
would be required to affected persons In order to ensure that compliance As a corollary to the prohibition set
associated with the transmittal of funds with the proposed prohibition on forth in proposed section
with which the covered financial certain transmittals of funds requires no 1010.668(b)(1), proposed section
institution maintains a direct tools or competencies other than those 1010.668(b)(2) provides that, if a
commercial relationship. already employed by covered financial covered financial institution knows or
And, as discussed below, should an institutions to maintain their current has reason to believe a transmittal of
entity seek to challenge being identified AML/CFT compliance programs, funds involves any A7 Network Sub-
as a Sub-Agent, FinCEN has set out a FinCEN has elected to provide at Agent and that such transmittal of funds
process by which the aggrieved party proposed section 1010.668(b)(1)(i) for is prohibited pursuant to paragraph
may petition for reconsideration of their the rejection of certain transmittals of (b)(1), the covered financial institution
inclusion on the list. Should an CVC that are received from or originate must notify affected persons associated
aggrieved identified Sub-Agent at A7 Network Sub-Agent or from an with the transmittal of funds with
successfully challenge the account or CVC address administered by
determination, FinCEN would update or on behalf of an A7 Network Sub- 80 FinCEN notes that CVC payment systems are
often designed to limit the control of specific
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the list accordingly. Agent and outline the steps a covered
financial institutions over transactions and to
financial institution should take in such prevent rejections of funds by persons or entities
3. Convertible Virtual Currency (CVC) circumstances. In providing for the other than the sender of funds. As a result, although
The term ‘‘convertible virtual rejection of CVC under certain limited covered financial institutions may institute an
currency (CVC)’’ means a medium of circumstances, FinCEN acknowledges internal prohibition on the sending of CVC
transactions to another address or entity, FinCEN
exchange that either has an equivalent that, at this time, there may be assesses that there are few, if any, readily available
value as currency, or acts as a substitute technological limitations that may limit ways for covered financial institutions to ‘‘reject’’
for currency, but lacks legal tender or preclude covered financial incoming CVC transactions (prior to receipt).
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Federal Register / Vol. 91, No. 191 / Monday, October 5, 2026 / Proposed Rules 63219
which the covered financial institution procedures designed to identify 3. The appropriate scope of the due
maintains a direct commercial transactions involving, and any use of diligence requirement in this proposed
relationship. The purpose of this any account to process transactions rule.
requirement is to ensure that persons involving, any A7 Network Sub-Agent.
VI. Executive Order 14294
affected by the proposed prohibition A covered financial institution would be
have an opportunity to understand the expected to apply an appropriate Section 5 of Executive Order 14294
nature and impact of the proposed screening mechanism to identify a directs that all future