OFAC issues reporting instructions for US financial institutions holding Russian sovereign assets under the REPO for Ukrainians Act

Mechanism

The REPO for Ukrainians Act, enacted as Division F of Public Law 118-50 on April 24, 2024 (part of the Ukraine supplemental appropriations package), authorises the US President to identify, isolate, and ultimately confiscate Russian sovereign assets located in US jurisdiction for the benefit of Ukraine. Section 104(a) of the Act required Treasury to issue reporting instructions within 90 days of enactment. This Federal Register notice (FR Doc 2024-16479, published July 26, 2024; instructions issued July 23) operationalises that mandate.

Scope of reporting

• Covered assets: funds and other property of the Russian Central Bank

(Bank of Russia), the Russian National Wealth Fund, and the Russian Ministry of Finance located in the US or in the possession/control of a US person.

• Covered reporters: any US financial institution at which such assets are

located, and any US financial institution that maintains correspondent or payable-through accounts for foreign financial institutions, where it knows or has reason to know that Russian sovereign assets are held in those accounts. The latter creates a due-diligence obligation flowing through US correspondent banking relationships.

• Form: TD-F 93.09 (REPO Report Form), filed electronically with OFAC.
• Deadlines: initial filings by August 2, 2024 (10 business days from the

July 23 issuance); recurring filings within 10 days of detecting any new qualifying asset. Previously-reported assets need not be re-reported.

Why this matters for the IPTM register

• The reporting layer is a precondition to any future seizure/transfer action

under the broader REPO authority. Without a complete US-side inventory of Russian sovereign assets, Treasury cannot exercise the confiscation power Section 105 contemplates.

• Most identified Russian sovereign assets sit in EU/Belgium (Euroclear) rather

than US accounts, so the US REPO inventory is expected to be modest in absolute terms (single-digit billions USD versus ~$300bn frozen in the EU). But the US instrument is doctrinally significant — it is the first G7 national-law confiscation framework actually enacted, ahead of the EU's later windfall-profit-only approach.

• Reporting failures are enforceable under IEEPA (50 USC §1705), with civil

penalties up to ~$370k per violation (2024 inflation-adjusted) and criminal penalties up to $1M and 20 years for willful violations.

Downstream implications

• Sets up future OFAC enforcement actions against US FIs that fail to identify

or report Russian sovereign assets in correspondent chains. Watch for first REPO-specific civil penalty cases in 2025-26.

• Provides the data substrate for any US-side contribution to the G7

Extraordinary Revenue Acceleration (ERA) Loans for Ukraine ($50bn package announced June 2024) — though the ERA structure uses windfall-profit flows from EU-held assets rather than US principal seizure.

• Establishes a precedent and template that allied jurisdictions (UK, Canada,

Australia, EU member states) may emulate if they move beyond windfall-profit-only structures toward principal-confiscation regimes.

Open questions

• How many US financial institutions actually filed initial reports, and what

is the total US-jurisdiction Russian-sovereign-asset balance? OFAC has not publicly disclosed aggregate figures.

• Will the next administration use Section 105 confiscation authority, hold it

in reserve as negotiating leverage, or let it lapse?

• Whether the reporting obligation creates secondary compliance risk for

non-US FIs with US correspondent accounts who unknowingly hold Russian sovereign assets — i.e., a de facto extraterritorial sweep.