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FTI Consulting, Inc. was engaged by an unnamed global law firm acting as an intermediary to provide expert economic consulting services — specifically expert-witness support — in connection with VTB Bank OAO's participation in Singapore litigation. VTB Bank OAO had been on OFAC's Sectoral Sanctions Identification (SSI) List since July 2014, subject to Directive 1 debt-tenor restrictions that prohibited US persons (and parties subject to US jurisdiction) from dealing in new debt of VTB with a maturity of more than 14 days.
Between April 2019 and May 2021, FTI issued six invoices totalling approximately $353,862 routed through the intermediary law firm. VTB made no payments or partial payments that extended well beyond the 14-day permissible tenor. In the most acute documented instance, a payment of approximately $19,400 was made 198 days after the invoice was issued — more than 13 times the permissible limit. By March 2020 FTI had received only one partial payment across the six invoice cycle.
OFAC's theory of violation: by issuing invoices on terms that allowed payment to remain outstanding beyond 14 days, FTI was "dealing in" prohibited debt within the meaning of Directive 1 — even though FTI did not directly receive VTB funds without an intermediary. The foundational principle applied: a US person may not do indirectly (through a law-firm payment channel) what it cannot do directly (invoice a Directive-1 SSI entity on terms extending debt beyond 14 days).
| Parameter | Value |
|---|---|
| Number of violations | 6 transactions |
| Aggregate invoice value | ~$353,862 |
| OFAC egregiousness determination | Non-egregious |
| Voluntary self-disclosure | No |
| Base penalty | $525,000 |
| Final civil monetary penalty | $1,050,000 (2× base) |
The doubling of the base penalty to reach $1,050,000 reflects OFAC's emphasis on deterrence: the absence of voluntary self-disclosure in a non-egregious case that nonetheless involved a sophisticated corporate actor who could reasonably have been expected to screen the SSI status of the ultimate beneficiary through the intermediary's payment chain.
1. Professional-services enforcement frontier. Prior enforcement completions in the register primarily targeted financial institutions, fintech platforms, commodity traders, and investment advisers. The FTI settlement extends Russia Directive 1 enforcement explicitly to professional-advisory / expert-witness firms whose client relationships create indirect credit exposure to SSI entities — even where the firm never touched VTB directly and invoiced only through an intermediary law firm. Peers filed in the same arc: King Holdings (2025-11-24), IPI Partners (2025-12-02), Gracetown (2025-12-04), Individual Fiduciary (2025-12-09) — each an enforcement action naming non-bank, non-fintech intermediaries.
2. Indirect-dealing doctrine reaffirmed. OFAC's "cannot do indirectly what you cannot do directly" principle is not new (it traces to the CACR Cuba and ITSR Iran enforcement history), but its application to sub-14-day invoice-tenor debt for expert-witness services via a law-firm intermediate is a material extension. Any professional-services firm that provides services to SSI-listed entities through intermediaries and allows invoices to remain unpaid beyond the applicable tenor threshold is potentially within the enforcement perimeter.
3. Pre-invasion (2019–2021) conduct enforced in 2026. The underlying violations occurred before Russia's February 2022 full invasion of Ukraine and the subsequent sanctions escalation. This confirms OFAC's willingness to pursue enforcement for Directive 1 pre-invasion debt-tenor violations even as the sanctions landscape has expanded dramatically. Statute-of-limitations risk for pre-2022 VTB / Russia SSI relationships involving professional services firms remains live.
Set at 2. Rationale: the total transaction value is ~$353,862 (very small versus the register's benchmark of Adani $275M or GVA Capital $216M); the conduct was non-egregious; the exposure was indirect via an intermediary law firm and produced no material sanctions-circumvention outcome for VTB's operations. The structural novelty (professional-services enforcement) and deterrence messaging justify inclusion in the register but not a higher severity score.
SSI-listed Russian state-owned banks (VTB, Gazprombank, Rosneft) through intermediary counsel — particularly for pre-2022 litigation mandates — should audit outstanding invoice and payment records for potential Directive 1 exposure before a statute-of-limitations assessment triggers OFAC scrutiny
counterparties now carry enhanced due-diligence obligations: allowing sub-client invoice exposure to accumulate beyond the applicable debt tenor through their trust accounts creates potential aiding-and-abetting liability
calibrates the compliance-cost floor: the expected value of discovery and enforcement exceeds the $525k base for most professional-services firms handling complex SSI-adjacent mandates, reinforcing the business case for proactive compliance
practice is to withhold intermediary names unless they are co-respondents)
MAS (Monetary Authority of Singapore) under Singapore's Monetary Authority Act or relevant financial-sanctions instruments
indirect-dealing risk in SSI-entity mandate structures