OFAC Requires Reporting of Russian Sovereign Assets by August 2 Under New REPO for Ukrainians Act

Financial institutions holding Russian sovereign assets must report them to the Treasury Department’s Office of Foreign Assets Control (OFAC) by August 2, according to a new mandate linked to the Rebuilding Economic Prosperity and Opportunity for Ukrainians Act (REPO for Ukrainians Act). This requirement extends to financial institutions that have newly discovered or acquired Russian sovereign assets, which must be reported within 10 days of detection, as stated in an OFAC press release on Tuesday.

Reports on Russian sovereign assets can be submitted using OFAC’s new form. Addar Levi, acting general counsel of the Treasury, commented on the legislative move, stating, “Congress took an important step with the passage of the REPO for Ukrainians Act to unlock the value of immobilized Russian sovereign assets to support Ukraine’s continued resilience and reconstruction. The United States will continue to work with our foreign partners, including the G7, to deliver support to Ukraine.”

The Washington Post reported ongoing discussions between the United States and its allies on how to utilize the investment returns of frozen Russian assets to aid Ukraine. Russia has approximately $280 billion in Western financial institutions, most of which is held by European firms, according to the Post. This money has been immobilized as part of the U.S.-led sanctions effort.

In response to these sanctions, Russia has threatened to freeze Western funds held within its borders. Despite numerous challenges, many Western financial institutions and businesses have reacted to Russia’s attack on Ukraine by winding down, selling, or otherwise withdrawing from Russia.

Additionally, other regulators, such as the Securities and Exchange Commission, have required public companies to disclose the financial impact of Russia’s war against Ukraine on their operations.

By fLEXI tEAM