The U.S. Department of the Treasury has sanctioned five individuals and four entities tied to the TGR Group, a sophisticated international sanctions evasion service catering to Russian elites.
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The TGR Group, believed to be led by Ukrainian national George Rossi, used cryptocurrencies — including Tether (USDT) — to help clients, including Russian oligarchs, ransomware gangs and international crime syndicates, obfuscate their illicit activities via a variety of money laundering techniques (including the in-person trading of cash for cryptocurrency and pre-paid credit cards) in order to get around international sanctions, according to a Wednesday press release from the Treasury Department. Tether, the issuer of the dollar-pegged stablecoin, froze $8 million worth of tokens held in more than 30 wallets on the same day.
“Through the TGR Group, Russian elites sought to exploit digital assets — in particular U.S. dollar backed stablecoins — to evade U.S. and international sanctions, further enriching themselves and the Kremlin,” Acting Under Secretary for Terrorism and Financial Intelligence Bradley Smith said in a statement. “The United States, alongside our allies and partners, remains committed to disrupting any effort by Russia to use digital assets or other illicit financial schemes to accrue, store and transfer their ill-gotten gains.”
The sanctions are the result of a joint investigation with the United Kingdom’s National Crime Agency (NCA), the government of the United Arab Emirates and two other U.S. agencies — the Financial Crimes Enforcement Network (FinCEN) and the Drug Enforcement Administration (DEA). The investigation, dubbed Operation Destabilise by the NCA, has resulted in more than 80 arrests and the seizure of more than $25 million in cash and cryptocurrency.
Rossi and two of his associates — Russian national Elena Chirkinyan and Latvian national Andrejs Bradens — were included in Wednesday’s sanctions. Two other Russians tied to already-sanctioned Ekaterina Zhdanova (the leader of the Russian money laundering operation The Smart Group), Khadzi-Murat Dalgatovich Magomedov and Nikita Valdimirovich Krasnov, were also sanctioned.
The entities sanctioned include three controlled by Rossi and Chirkinyan: TGR Partners, the main Moscow-based entity, a U.K. entity called TGR Corporate Concierge LTD, a UAE-based company called TGR-DWC-LLC.
The other sanctioned entities — Thailand-based electronics expert Siam Expert Trading Company Limited and Sheridan, Wyoming-based Pullman Global Solutions LLC — are controlled by Bradens.
Tether blacklisted over 30 wallet addresses containing more than $8 million collectively on Wednesday, though a representative for Tether declined to comment on “individual cases” when asked whether the newly blacklisted addresses were tied to TGR Group.
“Tether unequivocally condemns the illegal use of stablecoins and is fully committed to combatting illicit activity,” the spokesperson added. “With Tether, every action is online, every transaction is traceable, every asset can be seized and every criminal can be caught. The fact that this operation was shut down is testament to the traceability and apprehension of criminals and their illicit use of USDT.”
In October, the Wall Street Journal reported that Tether was being probed by the U.S. government for potentially violating sanctions and anti-money laundering rules. Tether has strongly denied the accuracy of the report.
