As global economic sanctions on Russian finance have intensified this week, steps to ensure that cryptocurrency isn’t a potential route for oligarchs to avoid new frameworks have been taken by Western governments. 

In the US, the government formed Task Force KleptoCapture, which seeks to eradicate potential evasion of AML and KYC methods using cryptocurrency by oligarchs. 

Attorney General Merrick B. Garland stated on the steps: “The Justice Department will use all of its authorities to seize the assets of individuals and entities who violate these sanctions. 

“We will leave no stone unturned in our efforts to investigate, arrest, and prosecute those whose criminal acts enable the Russian government to continue this unjust war. Let me be clear: if you violate our laws, we will hold you accountable.”

It emboldens a global approach to maximising sanctions and seizures – disconnecting oligarchs and those potentially seen as a money-laundering risk from embracing the anonymity of the blockchain. 

Elevating the united front when it comes to economic sanctions against Russia, the newly formed US force will work alongside the transatlantic task force announced by the President and leaders of the European Commission, France, Germany, Italy, the United Kingdom, and Canada. 

“To those bolstering the Russian regime through corruption and sanctions evasion: we will deprive you of safe haven and hold you accountable,” added Deputy Attorney General Lisa O. Monaco. “Oligarchs be warned: we will use every tool to freeze and seize your criminal proceeds.”

If reports are to be believed, the long-awaited implementation of the UK Economic Crime bill is also close to being finalised – which would give the government significantly more powers when it comes to seizing digital currency assets, which are deemed to be illicit. 

Commenting on the steps, Economic Secretary to the Treasury John Glen said: “We’ve put in place the largest and most severe package of sanctions ever imposed on Russia or indeed any major economy. 

“It’s critical that the Office of Financial Sanctions Implementation has all the powers it needs to enforce financial sanctions, so we are tightening the net in this legislation to ensure the economic pain imposed on the targets of the UK’s sanction regime hits home.”

The UK approach will utilise a register, in a bid to hone in on those engaging with dirty money – or seen as a key threat to the UK AML rules. 

Business Secretary Kwasi Kwarteng stated: “The new register will shine a light on who owns what in the UK so we can flush out the oligarchs, criminals and kleptocrats who think they can use UK property to hide their illicitly obtained wealth.”

In spite of confirming their compliance with any sanctions placed on Russia trading in the region, a number of the key digital currency trading platforms have distanced themselves from completely halting their services in the region. 

Changpeng Zhao, Binance Chief Executive, told the BBC on Wednesday that ‘If people want to avoid sanctions there’s always multiple methods, you can do it using cash, using diamonds, using gold. I don’t think crypto is anything special’.