November 20, 2023

OFAC issues Russian- and Western Balkan-related designations upon 14 individuals and entities

On November 16, 2023, the US Department of the Treasury’s Office of Foreign Assets Control designated 8 individuals and 6 entities for perpetuating corruption and enabling malign influence in the Western Balkans, including efforts by the Russian government to destabilize the region and influence institutions and organizations in Bosnia and Herzegovina (“BiH”), Montenegro, and North Macedonia.  The designations were imposed pursuant to Executive Order 14024, which authorizes sanctions with respect to specified harmful foreign activities of the Russian government, and EO 14033, which targets those responsible for or complicit in actions that threaten the implementation of any regional peace or cooperation agreement related to the Western Balkans.  The OFAC sanctions were coordinated with the US Department of State and its designation of 2 individuals and 12 entities in the Western Balkans pursuant to EO 14024.

Among the OFAC designees are several officials associated with Republika Srpska (“RS”), one of two entities that make up BiH.   The designations include Savo Cvijetinovic, a member of Alliance of Independent Social Democrats, the political party of RS President Milorad Dodik who has been designated in the US since 2017 and again in 2022.  According to OFAC, Cvijetinovic is a representative of newly designated BN Inzinjering, a RS-based company owned by a former commander and former deputy chief of military transport in the Russian Armed Forces, that allegedly facilitated the illegal transfer of helicopter engines manufactured in Ukraine to Russia via BiH.   BN Inzinjering and Cvijetinovic were designated pursuant to EO 14024 – BN Inzinjering for allegedly operating in the aerospace sector of the Russian economy and Cvijetinovic as an alleged leader or official associated with BN Inzinjering, a blocked person under EO 14024.

OFAC also designated Sergey Samsonenko, a wealthy businessman and dual citizen of Russia and North Macedonia who allegedly purchased land from US-designee Jordan Kamcev, an individual who was previously designated by the US in July 2023 under EO 14033.  According to OFAC, in connection with the land purchase, Samsonenko testified in a money laundering trial in North Macedonia that led to the indictments of Kamcev and his mother, Ratka Kunoska Kamceva.  OFAC reported that it designated Samsonenko, his wife Irina, and Kamcev’s mother pursuant to EO 14033 for their alleged efforts to launder funds and/or make payments in support of Kamcev, a blocked person under EO 14033, or an entity associated with Kamcev.  OFAC also designated Orka Holding AD, a Kamcev-associated conglomerate that operates in a wide variety of industries, pursuant to EO 14033 for being owned or controlled by Kamcev.

As a result of the OFAC designations, all property and interests in property of the designees within the United States or within the possession or control of a US person are blocked, and US persons are generally prohibited from engaging in transactions involving the designated persons.  In addition, entities owned 50 percent or more by one or more blocked persons are also blocked.  US persons may also face civil or criminal penalties for violating EO 14033.

In light of OFAC’s designation of Orka Holding, on November 16, 2023, OFAC issued General Licenses 2 and 3 under the Western Balkans Stabilization Regulations (“WBSR”), 31 CFR part 588.  General License 2 temporarily authorizes certain wind down transactions involving Orka Holding or any entity in which Orka Holding owns a 50 percent or greater interest.  The payments in GL 2 are authorized until March 15, 2024 provided that the payments to blocked persons are made into blocked accounts in accordance with the WBSR.  General License 3 authorizes certain transactions related to agricultural commodities, medicine, medical devices, software updates, and clinical trials, treatments and diagnosis involving Orka Holding.  OFAC also issued Frequently Asked Question (“FAQ”) 1140 to provide an overview of the types of transactions authorized by GL 3.

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