Proposal of Special Measure Prohibiting the Transmittal of Funds Regarding Transactions Involving the A7 Network's Sub-Agents

Issuing agencies

Abstract

FinCEN is issuing a finding and notice of proposed rulemaking, pursuant to section 9714(a) of the Combating Russian Money Laundering Act (Public Law 116-283), as amended by section 6106(b) of the National Defense Authorization Act for Fiscal Year 2022 (Public Law 117-81), finding transactions involving any company operating outside of the United States that is controlled by the A7 Network, a sanctions evasion and money laundering service with ties to Russia, leveraged by a wide range of illicit actors, including Iran and its terrorist proxies, to be a class of transactions of primary money laundering concern in connection with Russian illicit finance and proposing the imposition of a prohibition on certain transmittals of funds, by any covered financial institution, involving that class of transactions.

Full Text

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<title>Federal Register, Volume 91 Issue 191 (Monday, October 5, 2026)</title>
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[Federal Register Volume 91, Number 191 (Monday, October 5, 2026)]
[Proposed Rules]
[Pages 63208-63226]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-20371]


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DEPARTMENT OF THE TREASURY

Financial Crimes Enforcement Network

31 CFR Part 1010

RIN 1506-AB77


Proposal of Special Measure Prohibiting the Transmittal of Funds 
Regarding Transactions Involving the A7 Network's Sub-Agents

AGENCY: Financial Crimes Enforcement Network (FinCEN), Treasury.

ACTION: Notice of proposed rulemaking.

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SUMMARY: FinCEN is issuing a finding and notice of proposed rulemaking, 
pursuant to section 9714(a) of the Combating Russian Money Laundering 
Act (Public Law 116-283), as amended by section 6106(b) of the National 
Defense Authorization Act for Fiscal Year 2022 (Public Law 117-81), 
finding transactions involving any company operating outside of the 
United States that is controlled by the A7 Network, a sanctions evasion 
and money laundering service with ties to Russia, leveraged by a wide 
range of illicit actors, including Iran and its terrorist proxies, to 
be a class of transactions of primary money laundering concern in 
connection with Russian illicit finance and proposing the imposition of 
a prohibition on certain transmittals of funds, by any covered 
financial institution, involving that class of transactions.

[[Page 63209]]


DATES: Written comments on the notice of proposed rulemaking must be 
submitted on or before November 4, 2026.

ADDRESSES: Comments must be submitted in one of the following two ways 
(please choose only one of the ways listed):
    <bullet> Federal E-rulemaking Portal: <a href="https://www.regulations.gov">https://www.regulations.gov</a>. 
If you are reading this document on <a href="http://federalregister.gov">federalregister.gov</a>, you may use 
the green ``SUBMIT A PUBLIC COMMENT'' button beneath this rulemaking's 
title to submit a comment to the <a href="http://regulations.gov">regulations.gov</a> docket.
    <bullet> Mail: Financial Crimes Enforcement Network, P.O. Box 39, 
Vienna, VA 22183. Refer to Docket Number FINCEN-2026-0265 in the 
submission.
    Do not include any personally identifiable information (such as 
name, address, or other contact information) or confidential business 
information that you do not want publicly disclosed. All comments are 
public records; they are publicly displayed exactly as received, and 
will not be deleted, modified, or redacted. Comments may be submitted 
anonymously. Follow the search instructions on <a href="https://www.regulations.gov">https://www.regulations.gov</a> to view public comments.

FOR FURTHER INFORMATION CONTACT: FinCEN's Regulatory Support Section by 
submitting an inquiry at <a href="http://www.fincen.gov/contact">www.fincen.gov/contact</a>.

SUPPLEMENTARY INFORMATION:

I. Summary of Notice of Proposed Rulemaking

    This notice of proposed rulemaking (NPRM) (1) sets forth FinCEN's 
finding that transactions involving any company operating outside of 
the United States that is controlled by the A7 Network \1\ (a ``Sub-
Agent'' and, collectively, the ``Sub-Agents''), are a class of 
transactions of primary money laundering concern in connection with 
Russian illicit finance; and (2) proposes prohibiting certain 
transmittals of funds involving that class of transactions by any 
covered financial institution. As set out in this NPRM, transactions 
involving any Sub-Agent fall within a class of transactions of primary 
money laundering concern in connection with Russian illicit finance, as 
such transactions present a material risk of facilitating funds 
transfers designed to evade sanctions by illicit actors, including 
Russian and Iranian persons that have been designated by Treasury's 
Office of Foreign Assets Control (OFAC), such as the Islamic 
Revolutionary Guard Corps (IRGC), and intended to support illicit 
activities, including sanctions evasion involving or benefitting 
Russian and Iranian clients.
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    \1\ On October 1, 2026, the Department of the Treasury's Office 
of Foreign Assets Control (OFAC) sanctioned the A7 Network pursuant 
to Executive Order 13581, as amended by Executive Order 13863, for 
being a foreign person that constitutes a significant Transnational 
Criminal Organization. See U.S. Department of the Treasury, 
Operation Economic Outcast Takes Unprecedented Action Against 
Sanctions Evasion Network Used by Iran (Oct. 1, 2026).
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II. Background

A. Statutory Provisions

    Section 9714(a) of the Combating Russian Money Laundering Act (Pub. 
L. 116-283), as amended by section 6106(b) of the National Defense 
Authorization Act for Fiscal Year 2022 (Pub. L. 117-81) (section 
9714),\2\ provides, in relevant part, that, if the Secretary of the 
Treasury (Secretary) ``determines that reasonable grounds exist for 
concluding that . . . one or more classes of transactions within, or 
involving, a jurisdiction outside the United States . . . is of primary 
money laundering concern in connection with Russian illicit finance,'' 
the Secretary may, ``by order, regulation, or otherwise as permitted by 
law'': (1) require domestic financial institutions and domestic 
financial agencies to take 1 or more of the special measures described 
in 31 U.S.C. 5318A(b); \3\ or (2) prohibit, or impose conditions upon, 
certain transmittals of funds (as defined by the Secretary) by any 
domestic financial institution or domestic financial agency, if such 
transmittal of funds involves any such class of transaction. The 
authority of the Secretary to administer both section 9714 and the Bank 
Secrecy Act (BSA) has been delegated to FinCEN.\4\
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    \2\ Section 9714 (as amended) may be found in a note to 31 
U.S.C. 5318A.
    \3\ See infra note [4].
    \4\ Pursuant to Treasury Order 180-01, the authority of the 
Secretary to administer the BSA, including, but not limited to, 31 
U.S.C. 5318A, has been delegated to the Director of FinCEN. U.S. 
Department of the Treasury, Treasury Order 180-01 (Jan. 14, 2020). 
On August 11, 2022, and in accordance with Treasury Order 101-05 and 
31 U.S.C. 321(b), Treasury's Under Secretary for Terrorism & 
Financial Intelligence re-delegated to the Director of FinCEN the 
authority of the Secretary under section 9714.
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    Pursuant to section 9714, the Secretary may impose one or more of 
six special measures. First, the Secretary may impose any of the five 
special measures provided for in 31 U.S.C. 5318A(b), commonly known as 
section 311 of the USA PATRIOT Act.\5\ Through special measures one 
through four, the Secretary may impose additional recordkeeping, 
information collection, and reporting requirements on covered financial 
institutions.\6\ Through special measure five, the Secretary, in 
consultation with the Secretary of State, the Attorney General, and the 
Chairman of the Board of Governors of the Federal Reserve System, may 
``prohibit, or impose conditions upon, the opening or maintaining in 
the United States of a correspondent account or payable-through 
account'' for or on behalf of a foreign banking institution, if such 
correspondent account or payable-through account involves the class of 
transactions found to be of primary money laundering concern.\7\ In 
addition to the special measures set out in 31 U.S.C. 5318A, section 
9714 also provides that the Secretary may impose a special measure 
prohibiting, or imposing conditions upon, certain transmittals of 
funds.\8\
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    \5\ See 31 U.S.C. 5318A. 31 U.S.C. 5318A grants the Secretary 
the authority, upon finding that reasonable grounds exist for 
concluding that one or more financial institutions operating outside 
of the United States is of primary money laundering concern, to 
require domestic financial institutions and domestic financial 
agencies to take certain ``special measures.'' Regarding the 
``special measures'' that might be imposed, section 9714 references 
the five special measures set out in 31 U.S.C. 5318A(b)(1)-(5).
    \6\ 31 U.S.C. 5318A(b)(1)-(4).
    \7\ 31 U.S.C. 5318A(b)(5).
    \8\ See section 9714(a)(2).
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B. A7 Network and its Sub-Agents

    The OFAC-sanctioned transnational criminal organization (TCO), A7 
Network, is a global wholesale sanctions evasion and money laundering 
service with ties to Russia, leveraged by a wide range of illicit 
actors, including Iran and its terrorist proxies. Approximately 80 
percent of Russian banks have been sanctioned by the United States, 
United Kingdom, and European Union since 2022, and numerous key Russian 
banks have lost their access to the Society of Worldwide Interbank 
Financial Telecommunication (SWIFT).\9\ U.S., European Union (EU), and/
or United Kingdom (UK) sanctions and the resulting ``de-SWIFTing'' of 
Russian banks have significantly curtailed Russia's connectivity to the 
international financial system, leaving a void for the A7 Network to 
fill. Against that backdrop and although the A7 Network markets itself 
as merely an alternative payment system, the A7 Network was formally 
launched in September 2024 as a purpose-built mechanism to evade 
Western sanctions imposed in response to Russia's further

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invasion of Ukraine in 2022.\10\ However, as a self-described 
sanctions-resistant payment service provider, the A7 Network has 
evolved into a conduit for illicit activity associated with a wide 
range of threat actors, including North Korea (DPRK);Iran-backed 
terrorist organizations; cybercriminals and ransomware actors; and the 
IRGC.\11\
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    \9\ Congressional Research Service, Russia's War on Ukraine: 
Financial and Trade Sanctions (Feb. 22, 2023), at p. 2, <a href="https://www.congress.gov/crs-product/IF12062">https://www.congress.gov/crs-product/IF12062</a>.
    \10\ At least some elements of the A7 Network had a job posting 
listed in early 2026, seeking candidates with experience using 
SWIFT, and the company has hired staff from major Russian banks--
including OFAC-sanctioned Gazprombank, VTB Bank, and Sberbank--
suggesting that the A7 Network is intended to supplant the role 
previously filled by Russia's heavily sanctioned banking sector. 
HeadHunter, Manager for work with large and medium-sized businesses 
(last accessed July 1, 2026), <a href="https://hh.ru/vacancy/134528312?query=A7+SWIFT&hhtmfrom=vacancy_search_list">https://hh.ru/vacancy/134528312?query=A7+SWIFT&hhtmfrom=vacancy_search_list</a>; Open Source 
Centre, The Big Shor: A7 and the illusion of Russian financial 
innovation (2026), at p. 25, <a href="https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf">https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf</a>.
    \11\ See generally TRM Labs, ``The A7 Leaks: TRM's On-Chain 
Analysis of Russia's Cryptocurrency Connections'' (June 12, 2026).
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    The A7 Network's creation was driven by two U.S.-, EU- and UK-
designated parties: fugitive Moldovan oligarch Ilan Shor \12\ and 
Russia's state-owned defense bank Promsvyazbank Public Joint Stock 
Company (PSB).\13\ The core of the A7 Network is formed by three 
Russia-based companies--A7 Liability Company (A7 LLC), and its 
subsidiaries, A71 Limited Liability Company (A71 LLC) and A7 Agent 
Limited Liability Company (A7 Agent LLC)--which are jointly owned by 
Ilan Shor and PSB and subject to sanctions imposed by the United 
States, EU, and UK.\14\ These entities administer the network with and 
through several Russia- and Kyrgyz Republic-based persons, including 
businesses and digital asset exchanges subject to sanctions imposed by 
OFAC and the UK (as well as, in most cases, the EU), including Old 
Vector LLC, Garantex, Grinex, Independent Decentralized Finance 
Smartbank and Ecosystem (InDeFi Bank), ExVed, and Garantex co-founder 
Sergey Mendeleev (Mendeleev).\15\ Collectively, these entities leverage 
companies transacting in both fiat currency and digital assets in 
complex trade-based money laundering schemes to enable illicit actors 
to access the international financial system.\16\
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    \12\ Ilan Shor was designated by OFAC in October 2022, pursuant 
to E.O. 14024, for his involvement in Russian malign influence 
operations in Moldova. He was previously arrested on money 
laundering and embezzlement charges related to a 2014 theft valued 
at approximately USD 1 billion from Moldovan banks. U.S. Department 
of the Treasury, Press Release, Treasury Targets Corruption and the 
Kremlin's Malign Influence Operations in Moldova (Oct. 26, 2022), 
<a href="https://home.treasury.gov/news/press-releases/jy1049">https://home.treasury.gov/news/press-releases/jy1049</a>. Ilon Shor was 
also sanctioned by the United Kingdom on December 8, 2022. See UK 
Foreign, Commonwealth and Development Office (FCDO), Uk Sanctions 
List, <a href="https://search-uk-sanctions-list.service.gov.uk/designations/GAC0029/Individual">https://search-uk-sanctions-list.service.gov.uk/designations/GAC0029/Individual</a>.
    \13\ PSB was designated by OFAC in February 2022, pursuant to 
E.O. 14024, for issuing billions of dollars in financial support for 
Russian defense sector companies in its role as Russia's state 
defense bank. U.S. Department of the Treasury, Press Release, U.S. 
Treasury Imposes Immediate Economic Costs in Response to Actions in 
the Donetsk and Luhansk Regions (Feb. 22, 2022), <a href="https://home.treasury.gov/news/press-releases/jy0602">https://home.treasury.gov/news/press-releases/jy0602</a>. PSB was later 
redesignated in January 2025, pursuant to E.O. 13662, for operating 
in the financial services sector of the Russian Federation economy. 
U.S. Department of the Treasury, Press Release, Treasury Disrupts 
Russia's Sanctions Evasion Schemes (Jan. 15, 2025), <a href="https://home.treasury.gov/news/press-releases/jy2785">https://home.treasury.gov/news/press-releases/jy2785</a>; see also Open Source 
Centre, The Big Shor: A7 and the Illusion of Russian Financial 
Innovation (2026), at. p. 9, <a href="https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf">https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf</a>.
    \14\ U.S. Department of the Treasury, Press Release, Treasury 
Sanctions Cryptocurrency Exchange and Network Enabling Sanctions 
Evasion and Cyber Criminals (Aug. 14, 2025), <a href="https://home.treasury.gov/news/press-releases/sb0225">https://home.treasury.gov/news/press-releases/sb0225</a>; FCDO, UK Sanctions 
List, Several entities, <a href="https://search-uk-sanctions-list.service.gov.uk/?searchValue=promsvyazbank">https://search-uk-sanctions-list.service.gov.uk/?searchValue=promsvyazbank</a>, <a href="https://search-uk-sanctions-list.service.gov.uk/?searchValue=A7%2520llc">https://search-uk-sanctions-list.service.gov.uk/?searchValue=A7%2520llc</a>; European 
Union Sanctions Tracker, Ilan Shor, <a href="https://data.europa.eu/apps/eusanctionstracker/subjects/153809">https://data.europa.eu/apps/eusanctionstracker/subjects/153809</a>.
    \15\ See FCDO, UK Sanctions List, Several entities, <a href="https://search-uk-sanctions-list.service.gov.uk/designations/RUS3614/Individual">https://search-uk-sanctions-list.service.gov.uk/designations/RUS3614/Individual</a>; <a href="https://www.gov.uk/government/news/uk-targets-sanctions-circumvention-and-crypto-networks-exploited-by-russia">https://www.gov.uk/government/news/uk-targets-sanctions-circumvention-and-crypto-networks-exploited-by-russia</a>. European 
Union Sanctions tracker, Several entities, <a href="https://data.europa.eu/apps/eusanctionstracker/subjects/179337">https://data.europa.eu/apps/eusanctionstracker/subjects/179337</a>, <a href="https://data.europa.eu/apps/eusanctionstracker/subjects/172907">https://data.europa.eu/apps/eusanctionstracker/subjects/172907</a>, <a href="https://data.europa.eu/apps/eusanctionstracker/subjects/179375">https://data.europa.eu/apps/eusanctionstracker/subjects/179375</a>.
    \16\ See U.S. Department of the Treasury, Press Release, 
Treasury Sanctions Cryptocurrency Exchange and Network Enabling 
Sanctions Evasion and Cyber Criminals (Aug. 14, 2025), <a href="https://home.treasury.gov/news/press-releases/sb0225">https://home.treasury.gov/news/press-releases/sb0225</a>; U.S. Department of the 
Treasury, Press Release, Treasury Targets Corruption and the 
Kremlin's Malign Influence Operations in Moldova (Oct. 26, 2022), 
<a href="https://home.treasury.gov/news/press-releases/jy1049">https://home.treasury.gov/news/press-releases/jy1049</a>; U.S. 
Department of the Treasury, Press Release, Treasury Sanctions 
Russia-Based Hydra, World's Largest Darknet Market, and Ransomware-
Enabling Virtual Currency Exchange Garantex (Apr. 5, 2022), <a href="https://home.treasury.gov/news/press-releases/jy0701">https://home.treasury.gov/news/press-releases/jy0701</a>; U.S. Department of the 
Treasury, Press Release, U.S. Treasury Imposes Immediate Economic 
Costs in Response to Actions in the Donetsk and Luhansk Regions 
(Feb. 22, 2022), <a href="https://home.treasury.gov/news/press-releases/jy0602">https://home.treasury.gov/news/press-releases/jy0602</a>.
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    Significantly (and as noted above), OFAC has designated the 
founders and these core components and enablers, as well as sanctioning 
the A7 Network as a significant TCO.\17\ As a result, all property and 
interests in property of these persons described above that are in the 
United States or in the possession or control of U.S. persons are 
blocked and must be reported to OFAC. In addition, any entities that 
are owned, directly or indirectly, individually or in the aggregate, 50 
percent or more by one or more blocked persons are also blocked. Unless 
authorized by a general or specific license issued by OFAC, or exempt, 
OFAC's regulations generally prohibit all transactions by U.S. persons 
or within (or transiting) the United States that involve any property 
or interests in property of designated or otherwise blocked persons. In 
addition, financial institutions and other persons that engage in 
certain transactions or activities with these sanctioned entities and 
individuals may expose themselves to sanctions, including making of any 
contribution or provision of funds, goods, or services by, to, or for 
the benefit of any designated person, or the receipt of any 
contribution or provision of funds, goods, or services from any such 
person, or be subject to an enforcement action.
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    \17\ On October 1, 2026, the Department of the Treasury's Office 
of Foreign Assets Control (OFAC) sanctioned the A7 Network pursuant 
to Executive Order 13581, as amended by Executive Order 13863, for 
being a foreign person that constitutes a significant Transnational 
Criminal Organization. See U.S. Department of the Treasury, 
Operation Economic Outcast Takes Unprecedented Action Against 
Sanctions Evasion Network Used by Iran (Oct. 1, 2026).
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    Building on these actions, FinCEN assesses that the A7 Network has 
created, and continues to operate, a financial network to further and 
enable widespread sanctions evasion and the laundering of billions of 
dollars tied to illicit activity. When A7 LLC was founded in 2024, PSB 
issued a press release touting the new service as a way to ``support 
Russian foreign trade participants and their trading partners amid 
anti-Russian sanctions pressure,'' indicating that sanctions evasion is 
part of the business model.\18\ Speaking at the Russia-China Mutually 
Beneficial Cooperation forum (ROSTKI) in August 2025, A7 LLC's Vice 
President Mikhail Tolkunov described A7's core capabilities:
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    \18\ Promsvyazbank, PSB has launched a unique mechanism for 
crossborder settlements for foreign trade between Russian companies 
and counterparties from any country (Oct. 8, 2024), <a href="https://www.oreanda-news.com/en/finansy/promsvyazbank-has-launched-a-mechanism-for-cross-border-settlements/article1531534/">https://www.oreanda-news.com/en/finansy/promsvyazbank-has-launched-a-mechanism-for-cross-border-settlements/article1531534/</a>.

    ``The company `A7' was created by PSB Bank [in 2025] and 
operates in the field of cross border transfers . . . the service 
allows you to create a personal account remotely and transfer funds 
within one day with minimal fees. Document management is carried out 
electronically . . . The platform was created for transfers in any 
currency, including dollars, yuan, dirhams, and euros. Transfers are 
completely secure, as our entire financial infrastructure is built 
on an independent architecture and is not tied to international 
payment systems. This means

[[Page 63211]]

we are not threatened by any unilateral restrictions.'' \19\
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    \19\ Kommersant, Investment Cooperation Between Russia and 
China: Growth Points. Kommersants Session at the Third Russia-China 
International Forum (Aug. 19, 2025), at p. 2, <a href="https://www.events.kommersant.ru/events/sessiya-na-rostki-2025">https://www.events.kommersant.ru/events/sessiya-na-rostki-2025</a>.

As of January 2026, the A7 Network claimed to process more than 2,000 
transactions per day with a historical total transaction volume of more 
than 7.5 trillion rubles (RUB), the equivalent of USD 91.5 billion. 
This would amount to nearly 13 percent of the Russian Federation's 2025 
foreign trade transactions, meaning that nearly one in eight dollars of 
Russia's foreign trade allegedly flows through A7's Network.\20\
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    \20\ Centre for Information Resilience, A7 in Africa (Apr. 2, 
2026), at p. 3, <a href="https://www.info-res.org/app/uploads/2026/04/A7-Africa-Final.pdf">https://www.info-res.org/app/uploads/2026/04/A7-Africa-Final.pdf</a>.
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    There are indications that the Russian government perceives the A7 
Network to be a strategically important enterprise. In September 2025 
Russian President Vladimir Putin attended the virtual ribbon cutting 
for the opening of an A7 Network office in Vladivostok, Russia.\21\ 
Several oligarchs with close ties to the Kremlin have reportedly used 
the A7 Network to make international payments, including UK-sanctioned 
Roman Abramovich, OFAC-sanctioned former Federal Security Service 
Director Nikolai Patrushev, OFAC-sanctioned Arkady Rotenberg, and 
businesses linked to UK-sanctioned Leonid Mikkelson.\22\ Moreover, two 
OFAC-sanctioned Russian financial institutions maintain an interest in 
the A7 Network, PSB and VEB.RF (VEB), Russia's state-owned development 
bank.\23\ Additionally, a Kyrgyzstan-based company reportedly used the 
A7 Network to obfuscate transactions related to the purchase of Russian 
gas supplies for T[uuml]rkiye following the imposition of sanctions on 
Russian bank Gazprombank, which typically handles energy 
transactions.\24\
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    \21\ Radio Free Europe/Radio Liberty, A7, Company Implicated In 
Sanctions Evasion, Reportedly Linked To Russian Oligarchs (Apr. 30, 
2026), <a href="https://www.rferl.org/a/russia-cryptocurrency-a7a5-ilan-shor-investigation-sanction-evasion/33746026.html">https://www.rferl.org/a/russia-cryptocurrency-a7a5-ilan-shor-investigation-sanction-evasion/33746026.html</a>.
    \22\ Radio Free Europe/Radio Liberty, A7, Company Implicated In 
Sanctions Evasion, Reportedly Linked To Russian Oligarchs (Apr. 30, 
2026), <a href="https://www.rferl.org/a/russia-cryptocurrency-a7a5-ilan-shor-investigation-sanction-evasion/33746026.html">https://www.rferl.org/a/russia-cryptocurrency-a7a5-ilan-shor-investigation-sanction-evasion/33746026.html</a>; UK Foreign, 
Commonwealth and Development Office Sanctions List, Roman 
Arkadyevich Abramovich (Mar. 10, 2022), <a href="https://search-uk-sanctions-list.service.gov.uk/designations/RUS0270/Individual">https://search-uk-sanctions-list.service.gov.uk/designations/RUS0270/Individual</a>; U.S. Department 
of the Treasury, Treasury Designates Russian Oligarchs, Officials, 
and Entities in Response to Worldwide Malign Activity (Apr. 6, 
2018), <a href="https://home.treasury.gov/news/press-releases/sm0338">https://home.treasury.gov/news/press-releases/sm0338</a>; U.S. 
Department of the Treasury, Treasury Sanctions Russian Officials, 
Members Of The Russian Leadership's Inner Circle, And An Entity For 
Involvement In The Situation In Ukraine (Mar. 20, 2014), <a href="https://home.treasury.gov/news/press-releases/jl23331">https://home.treasury.gov/news/press-releases/jl23331</a>; UK Foreign, 
Commonwealth and Development Office Sanctions List, Leonid 
Viktorovich Mikhelson (Apr. 6, 2022), <a href="https://search-uk-sanctions-list.service.gov.uk/designations/RUS1126/Individual">https://search-uk-sanctions-list.service.gov.uk/designations/RUS1126/Individual</a>.
    \23\ PSB pledged its ownership stake in A7 LLC to VEB as 
collateral for loans to A7 LLC. Centre for Information Resilience, 
A7 Abroad: How A7 Sells International Sanctions Evasion as a Service 
(Oct. 2025), at p. 5, <a href="https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf">https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf</a>. VEB was sanctioned by OFAC in 2022 at the 
same time as PSB. U.S. Department of the Treasury, U.S. Treasury 
Imposes Immediate Economic Costs in Response to Actions in the 
Donetsk and Luhansk Regions (Feb. 22, 2022), <a href="https://home.treasury.gov/news/press-releases/jy0602">https://home.treasury.gov/news/press-releases/jy0602</a>. UK Foreign, 
Commonwealth and Development Office Sanctions List, Roman 
Abrahmovich, (March 10, 2022) <a href="https://search-uk-sanctions-list.service.gov.uk/designations/RUS1126/Individual">https://search-uk-sanctions-list.service.gov.uk/designations/RUS1126/Individual</a>.
    \24\ Radio Free Europe/Radio Liberty, A7, Company Implicated In 
Sanctions Evasion, Reportedly Linked To Russian Oligarchs (Apr. 30, 
2026), <a href="https://www.rferl.org/a/russia-cryptocurrency-a7a5-ilan-shor-investigation-sanction-evasion/33746026.html">https://www.rferl.org/a/russia-cryptocurrency-a7a5-ilan-shor-investigation-sanction-evasion/33746026.html</a>.
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    The scope of the A7 Network's activities is only possible through 
its global network of Sub-Agents. Shortly after its establishment, the 
A7 Network began aggressively expanding into new jurisdictions and 
forming companies--``Sub-Agents''--controlled by the A7 Network and 
designed to receive and remit payments to facilitate transactions for 
the A7 Network. The first Sub-Agents were established in the Kyrgyz 
Republic, and the A7 Network has since established Sub-Agents across 
Central and East Asia, Africa, Europe, and the Middle East.\25\
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    \25\ Open Source Centre, The Big Shor: A7 and the Illusion of 
Russian Financial Innovation (2026), at. pp. 25-26, <a href="https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf">https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf</a>.
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    The A7 Network has indicated it plans to expand its global 
footprint, potentially enhancing its reach and ability to move funds 
outside of the formal financial system into currently untapped regions, 
including Latin America.\26\ Until recently, the A7 Network only had a 
physical presence in Russia, but in the fall of 2025 the company 
announced the opening of its first overseas offices in Nigeria and 
Zimbabwe and signaled aspirations to further expand in Africa.\27\ In 
June 2026, Shor stated that ``A7 plans to operate everywhere.'' \28\
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    \26\ See Centre for Information Resilience, A7 Abroad: How A7 
Sells International Sanctions Evasion as a Service (Oct. 2025), at 
p.8, <a href="https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf">https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf</a>; see also Alexander Osipovich, ``Russia's Hottest Startup 
Is a State-Backed Sanctions Evasion Network,'' The Wall Street 
Journal (Aug. 7, 2026), <a href="https://www.wsj.com/world/russia/russias-hottest-startup-is-a-state-backed-sanctions-evasion-network-7afc488c?mod=article_inline">https://www.wsj.com/world/russia/russias-hottest-startup-is-a-state-backed-sanctions-evasion-network-7afc488c?mod=article_inline</a>.
    \27\ Centre for Information Resilience, A7 in Africa (Apr. 2, 
2026), at p. 2, <a href="https://www.info-res.org/app/uploads/2026/04/A7-Africa-Final.pdf">https://www.info-res.org/app/uploads/2026/04/A7-Africa-Final.pdf</a>.
    \28\ Reuters, Russia's A7 transborder payments company plans 
global expansion (June 4, 2026), <a href="https://www.reuters.com/business/finance/russias-a7-transborder-payments-company-plans-global-expansion-2026-06-04/">https://www.reuters.com/business/finance/russias-a7-transborder-payments-company-plans-global-expansion-2026-06-04/</a>.
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III. Finding That Transactions Involving any Sub-Agent of the A7 
Network Are a Class of Transactions of Primary Money Laundering Concern 
in Connection With Russian Illicit Finance

    Based on public and non-public information available to FinCEN, 
FinCEN finds that reasonable grounds exist for concluding that 
transactions involving any Sub-Agent of the A7 Network are a class of 
transactions of primary money laundering concern in connection with 
Russian illicit finance, as such transactions present a material risk 
of facilitating funds transfers designed to evade sanctions by illicit 
actors, including Russian and Iranian persons that have been designated 
by OFAC, and intended to support illicit activities, including 
sanctions evasion involving or benefitting Russian and Iranian clients. 
In making this finding, FinCEN has considered the relevant evidence in 
light of factors identified in 31 U.S.C. 5318A(c)(2)(B), taking into 
account the specific circumstances of money laundering activities in 
connection with Russian illicit finance and the protection of U.S. 
national security and the U.S. financial system. While FinCEN is under 
no obligation pursuant to section 9714 to consider any particular 
factor or set of factors when making a finding that a financial 
institution operating outside of the United States is of primary money 
laundering concern in connection with Russian illicit finance, it 
nonetheless finds these factors instructive in guiding the analysis set 
forth below.\29\
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    \29\ 31 U.S.C. 5318A(c)(2)(B) provides, as relevant here, that 
in making a finding that reasonable grounds exist for concluding 
that a class of transactions within, or involving, a jurisdiction 
outside the United States is of primary money laundering concern and 
to apply one or more of special measures one through four to such a 
financial institution, the Secretary shall consider such information 
as the Secretary determines to be relevant, including the following 
potentially relevant factors:
    (1) The extent to which such financial institutions, 
transactions, or types of accounts are used to facilitate or promote 
money laundering in or through the jurisdiction, including any money 
laundering activity by organized criminal groups, international 
terrorists, or entities involved in the proliferation of weapons of 
mass destruction or missiles;
    (2) The extent to which such institutions, transactions, or 
types of accounts are used for legitimate business purposes in the 
jurisdiction; and
    (3) The extent to which such action is sufficient to ensure, 
with respect to transactions involving the jurisdiction and 
institutions operating in the jurisdiction, that the purposes of 
this subchapter continue to be fulfilled, and to guard against 
international money laundering and other financial crimes.

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[[Page 63212]]

A. The Extent to Which Transactions Involving any Sub-Agent of the A7 
Network Are a Class of Transactions of Primary Money Laundering Concern 
in Connection With Russian Illicit Finance

    As indicated above, the A7 Network provides a financial services 
infrastructure for clients in Russia and other heavily sanctioned 
jurisdictions, such as Iran, that enables those clients to make cross-
border payments in both fiat currency and digital assets while 
obscuring the sanctions nexus from U.S. and foreign financial 
institutions. Importantly, a crucial feature of the A7 Network's 
financial services infrastructure is, and remains, its use of, and 
reliance on, its Sub-Agents, offering the A7 Network and its clients a 
means of obfuscating the involvement of Russian or other sanctioned 
actors in payments that appear to financial institutions as ordinary 
commercial activity.
1. The A7 Network's Sub-Agents
    Although the core operations of the A7 Network are directed by A7 
LLC and its subsidiaries, working with and through several Russia- and 
Kyrgyz Republic-based businesses and digital asset exchanges, the A7 
Network's Sub-Agents are a critical element within the Network's 
financial services infrastructure, allowing the Network to obfuscate 
the source and parties to transactions, to access foreign currencies, 
to make payments appear as ordinary commercial activity, and to 
circumvent applicable sanctions and other restrictions.
    As noted above, shortly after its establishment, the A7 Network 
began aggressively expanding into new jurisdictions and forming Sub-
Agents, with the first Sub-Agents established in Kyrgyz Republic, 
followed by expansion across Central and East Asia, Africa, Europe, and 
the Middle East.\30\ As of June 2026, the A7 Network has created or 
acquired hundreds of Sub-Agents, with bank accounts at approximately 
435 financial institutions in at least 83 countries.
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    \30\ Open Source Centre, The Big Shor: A7 and the Illusion of 
Russian Financial Innovation (2026), at pp. 25-26, <a href="https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf">https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf</a>.
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    To establish the Sub-Agents, the A7 Network forms, acquires, or 
partners with companies in third countries--such as Hong Kong, 
Indonesia, the Kyrgyz Republic, the Seychelles, T[uuml]rkiye, and the 
United Arab Emirates (UAE). Although on paper, these companies are 
typically represented to be owned or managed by non-Russian third-
country nationals, they are ultimately controlled by with the A7 
Network.\31\ Once established, Sub-Agents provide the A7 Network with 
access to correspondent banking relationships and foreign-currency 
liquidity, enabling the A7 Network to transmit value through the 
international financial system without a Russian or other sanctioned 
customer appearing in the payment chain and commonly causing financial 
institutions to be unwitting accomplices.
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    \31\ See Open Source Centre, The Big Shor: A7 and the Illusion 
of Russian Financial Innovation (2026), at p. 33, <a href="https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf">https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf</a>.
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    In a typical A7 Network transaction, the A7 Network customer 
satisfies its payment obligation through the A7 Network's internal 
settlement system, while a Sub-Agent located outside of Russia appears 
as the contracting or paying party on invoices, sales agreements, and 
payment instructions to the ultimate supplier of a good. In essence, 
this is a form of trade-based money laundering that leverages Sub-
Agents, falsified trade documents, false import-export records, and 
misleading goods descriptions. In many cases, funds may be transferred 
between multiple Sub-Agents to create additional layers of obfuscation 
before arriving at the final destination.\32\ Through this process, the 
Sub-Agents provide the A7 Network with access to correspondent banking 
relationships, access to the SWIFT network, and foreign-currency 
liquidity, enabling it to transmit value through the international 
financial system without a Russian customer appearing in the payment 
chain.\33\
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    \32\ A7 Abroad: How A7 Sells International Sanctions Evasion as 
a Service (Oct. 2025), at p. 16, <a href="https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf">https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf</a>.
    \33\ Open Source Centre, The Big Shor: A7 and the illusion of 
Russian financial innovation (2026), at pp. 41-42, <a href="https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf">https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf</a>.
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    While funds are typically moved between companies by Moscow-based 
A7 Network personnel, the A7 Network leverages Virtual Private Networks 
(VPNs) to create the illusion that these individuals are located 
outside of Russia and obscuring the connection between Russia and the 
Sub-Agents.\34\ These VPNs typically depend on infrastructure provided 
by IT companies controlled by Ilan Shor and have operated on the 
domains <a href="http://muzpan.com">muzpan.com</a> and <a href="http://sodkamus.com">sodkamus.com</a> and often appear to have IP 
addresses in Dubai, Hong Kong, or the Kyrgyz Republic, thereby 
disguising the connection to Russia.\35\ Thus, there is often no clear 
indication of a connection between a Sub-Agent and the A7 Network's 
clients, including, in particular, clients in the heavily sanctioned 
jurisdiction, on whose behalf the Sub-Agent is transacting. Sub-Agent 
transactions, however, are likely to exhibit typical money laundering 
indicators, including transactions in unusually high volumes shortly 
after the company is formed, inconsistencies between goods descriptions 
and supplier business profiles, unusual payment routing through A7 
Network-controlled companies, and falsified or AI-altered invoices.\36\
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    \34\ See Centre for Information Resilience, A7A5: Circumventing 
sanctions with stablecoin cryptocurrency (June 25, 2025), at p. 15, 
<a href="https://www.info-res.org/app/uploads/2025/06/A7A5-Report-June-2025-Final-Draft-1.pdf">https://www.info-res.org/app/uploads/2025/06/A7A5-Report-June-2025-Final-Draft-1.pdf</a>; Open Source Centre, The Big Shor: A7 and the 
Illusion of Russian Financial Innovation (2026), at pp. 28, 68, 
<a href="https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf">https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf</a>.
    \35\ See Open Source Centre, The Big Shor: A7 and the Illusion 
of Russian Financial Innovation (2026), at pp. 26, 39, <a href="https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf">https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf</a>.
    \36\ See Alexander Osipovich, ``Russia's Hottest Startup Is a 
State-Backed Sanctions Evasion Network,'' The Wall Street Journal 
(Aug. 7, 2026). For more information about the use of AI to alter or 
generate fraudulent documents in furtherance of illicit finance 
schemes, see FinCEN, FIN-2024-Alert004, ``FinCEN Alert on Fraud 
Schemes Involving Deepfake Media Targeting Financial Institutions'' 
(Nov. 14, 2024), at pp. 3-5.
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    FinCEN assesses that the layer of obfuscation provided by Sub-
Agents has enabled the A7 Network to circumvent U.S. sanctions and 
anti-money laundering and countering the financing of terrorism (AML/
CFT) controls, tainting the global financial system with billions in 
illicit funds stemming from, among other activities, Russian and 
Iranian sanctions evasion.

2. The A7 Network's Use of Financial Instruments Facilitates Illicit 
Cross-Border Trade

    In a typical fiat transaction, the A7 Network facilitates 
international trade through extensive use of financial instruments, 
including bills of exchange or promissory notes (referred to as veksels 
in Russian), that record value inside the Network. Specifically, an A7 
Network customer provides the A7 Network with information necessary to 
execute the transaction, which may include supplier information and 
trade documentation. The A7 Network then satisfies its customer's 
payment obligation through A7 Network-controlled settlement mechanisms 
that record value inside the Network.\37\ Between September 30, 2024 
and July

[[Page 63213]]

22, 2025, the A7 Network's clients purchased more than 3,200 bills of 
exchange worth the equivalent of more than USD 25 billion, indicating 
that there is robust demand for A7 Network's services.\38\ These bills 
of exchange are purchased by companies and traders--becoming the 
customer's credit within the system--and each purchase gets them on the 
A7 Network's ledger, reducing the need to do direct international bank 
transfers and helping to avoid scrutiny by banks. The A7 Network then 
assigns a foreign Sub-Agent to appear as the contracting or paying 
party on invoices, sales agreements, and payment instructions. This 
enables the payment to be executed from non-Russian bank accounts 
through correspondent banking and SWIFT channels.\39\
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    \37\ See Open Source Centre, The Big Shor: A7 and the Illusion 
of Russian Financial Innovation (2026), at pp. 30-31, <a href="https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf">https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf</a>.
    \38\ Id. at pp. 30-31.
    \39\ Id., at. pp. 32-34. Several sanctioned Russian financial 
institutions were removed from the SWIFT system in March 2022 
shortly after its full-scale invasion of Ukraine, making it 
significantly harder for Russian financial institutions to conduct 
cross-border transactions. See SWIFT, ``An update to our message for 
the Swift Community'' (Mar. 20, 2022), <a href="https://www.swift.com/news-events/news/message-swift-community">https://www.swift.com/news-events/news/message-swift-community</a>.
---------------------------------------------------------------------------

    In particular, the A7 Network has honed its process for executing 
international payments through complex financial arrangements and its 
constellation of enabling Sub-Agents. The typical process requires a 
customer to provide the A7 Network with documentation outlining the 
foreign counterparty requiring payment and attendant bank details, 
description of the goods being bought, and price. The A7 Network then 
matches the intended transaction with a relevant Sub-Agent in its 
global network, many of which are industry-specific to provide 
plausible cover for transactions.\40\ These Sub-Agents do not have any 
Russians on the board of directors or as shareholders and their bank 
accounts are managed by A7 Network staff in Russia via VPNs, all to 
appear as if the companies are being operated from within the country 
of registration.\41\ The A7 Network then uses software that generates 
fake invoices and trade documents to make the transactions seem 
legitimate--including by stripping any reference to Russia.\42\
---------------------------------------------------------------------------

    \40\ Open Source Centre, The Big Shor: A7 and the illusion of 
Russian financial innovation (2026), at p. 41, <a href="https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf">https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf</a>. The A7 
Network's Sub-Agents are tailored, insofar as it is possible, to the 
industries for which they are moving payments to avoid scrutiny from 
financial institutions. However, there are some indications that the 
A7 Network at times struggles to match Sub-Agents with specific 
customer business profiles. Id. at p. 20.
    \41\ Id. at pp. 33, 39.
    \42\ Id. at pp. 41-42.
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    The A7 Network also reportedly maintains reserves of currency in 
foreign bank accounts, to pay individuals and entities outside of 
Russia without the need for cross-border transactions. The A7 Network 
keeps records of the money it receives from its clients in Russia, and 
the money it sends to external parties to maintain adequate funding on 
both sides of the border and balance the books, enabling the Russian 
clients of the A7 Network to evade sanctions and avoid disruption.\43\ 
FinCEN assesses transactions involving the A7 Network's Sub-Agents 
enable its clients to send or receive money to nearly any country and 
in nearly any currency--including, U.S. dollars, yuan, dirhams, and 
euros--by using banks that have correspondent relationships with larger 
financial institutions that, but for obfuscation by the A7 Network, 
would not engage in these transactions, permitting illicit actors 
access to a money laundering platform and decreasing the risk of this 
activity being identified by investigating authorities.\44\
---------------------------------------------------------------------------

    \43\ Id. at p. 46.
    \44\ Id. at pp. 52-53.
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    Using these settlement mechanisms, the A7 Network's clients have 
reportedly been able to transact with counterparties in Africa, Asia, 
Europe, North America, and South America despite the restrictive 
sanctions on Russian banks.\45\
---------------------------------------------------------------------------

    \45\ Open Source Centre, The Big Shor: A7 and the illusion of 
Russian financial innovation (2026), at pp. 25, 34, 37,<a href="https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf">https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf</a>.
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3. The A7 Network's Creation and Use of the A7A5 Stablecoin
    In parallel with its fiat settlement mechanism, the A7 Network may 
use digital assets, including A7A5, a ruble-backed stablecoin that 
operates on the Tron and Ethereum blockchains,<SUP>46 47</SUP> to 
transfer value across A7 Network-linked actors where banking channels 
are restricted or less dependable.\48\ Kyrgyz Republic-registered, 
OFAC-sanctioned digital assets firm Old Vector LLC worked with digital 
assets exchange Garantex, Garantex's successor exchange Grinex, and 
others in the creation, issuance, and trading of the A7A5 token.\49\ A7 
Network created the A7A5 stablecoin for Russian clients of OFAC-
designated A7 LLC, a firm that provides cross-border settlement 
platforms frequently used for sanctions evasion.\50\ Although A7A5 is 
issued by Kyrgyzstan-based Old Vector, each coin is backed by ruble 
deposits held at PSB, meaning for every A7A5 transaction, there is a 
corresponding nexus to a sanctioned Russian bank.\51\
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    \46\ The A7A5 tokens operate from smart contracts with addresses 
at 0x6fA0BE17e4beA2fCfA22ef89BF8ac9aab0AB0fc9 and 
TLeVfrdym8RoJreJ23dAGyfJDygRtiWKBZ. See <a href="https://etherscan.io/token/0x6fA0BE17e4beA2fCfA22ef89BF8ac9aab0AB0fc9#code">https://etherscan.io/token/0x6fA0BE17e4beA2fCfA22ef89BF8ac9aab0AB0fc9#code</a>; <a href="https://tronscan.org/token20/TLeVfrdym8RoJreJ23dAGyfJDygRtiWKBZ/code">https://tronscan.org/token20/TLeVfrdym8RoJreJ23dAGyfJDygRtiWKBZ/code</a>.
    \47\ Stablecoins are a type of digital asset for which the value 
of the token is tied to another asset, typically a fiat currency 
such as the U.S. dollar. Stablecoins are appealing to illicit actors 
due to their relative liquidity, ease of settlement, and exchange 
rate stability. See U.S. Department of the Treasury, 2026 National 
Proliferation Financing Risk Assessment (Mar. 2026), at p. 16, 
<a href="https://home.treasury.gov/system/files/246/2026-NPFRA.pdf">https://home.treasury.gov/system/files/246/2026-NPFRA.pdf</a>; see also 
U.S. Department of the Treasury, 2026 National Money Laundering Risk 
Assessment (Mar. 2026), at pp. 52-53, <a href="https://home.treasury.gov/system/files/246/2026-NMLRA.pdf">https://home.treasury.gov/system/files/246/2026-NMLRA.pdf</a>.
    \48\ See U.S. Department of the Treasury, Press Release, 
Treasury Sanctions Cryptocurrency Exchange and Network Enabling 
Sanctions Evasion and Cyber Criminals (Aug. 14, 2025), <a href="https://home.treasury.gov/news/press-releases/sb0225">https://home.treasury.gov/news/press-releases/sb0225</a>.
    \49\ Garantex, which had been previously sanctioned as a 
prolific money launderer for Russian cybercriminals and other 
illicit actors, executed a scheme to move its funds to a successor 
exchange, Kyrgyzstan-based Grinex, following disruptive action by 
U.S. law enforcement in March 2025. Garantex allowed its customers 
who lost their funds following the law enforcement disruptions to 
regain access to their accounts using the A7A5 token. See Treasury 
Press Release, ``Treasury Sanctions Russia-Based Hydra, World's 
Largest Darknet Market, and Ransomware-Enabling Virtual Currency 
Exchange Garantex'' (Apr. 5, 2026); see also Aug. 2025 Treasury 
Press Release, supra note 2. See also Etherscan, Contract, ``Token 
A7A5'' (accessed Aug. 17, 2026).
    \50\ U.S. Department of the Treasury, Press Release, Treasury 
Sanctions Cryptocurrency Exchange and Network Enabling Sanctions 
Evasion and Cyber Criminals (Aug. 14, 2025), <a href="https://home.treasury.gov/news/press-releases/sb0225">https://home.treasury.gov/news/press-releases/sb0225</a>; A7A5, Homepage, 
<a href="https://www.a7a5.kg/trade_and_earn?chain=tron%3Flang%3Den">https://www.a7a5.kg/trade_and_earn?chain=tron%3Flang%3Den</a>. <a href="https://www.a7a5.kg/trade_and_earn?chain=tron%3Flang%3Den">https://www.a7a5.kg/trade_and_earn?chain=tron%3Flang%3Den</a>.
    \51\ A7A5, Why A7A5, at p. 1, <a href="https://www.a7a5.kg/why_a7a5">https://www.a7a5.kg/why_a7a5</a>; 
Chainalysis, How A7A5 and Grinex Enable The Russian Shadow Crypto 
Economy (Aug. 14, 2025), at pp. 2-3, <a href="https://www.chainalysis.com/blog/a7a5-grinex-russian-crypto-economy-ofac-sanctions-august-2025/">https://www.chainalysis.com/blog/a7a5-grinex-russian-crypto-economy-ofac-sanctions-august-2025/</a>.
---------------------------------------------------------------------------

    The A7A5 tokens are used to conduct transactions outside of the 
formal financial system. The token serves as an internal accounting 
method for the network, moving across internal addresses to maintain a 
balanced ledger, effectively acting as part of a broader mirror 
system,\52\ to the international

[[Page 63214]]

payments that the network makes.\53\ This broader mirror system also 
involves the use of the aforementioned bills of exchange, known as 
``veksels''. According to public and nonpublic information, the tokens 
are used for transfers within Russia that represent foreign payments 
and are made through nested digital asset wallets and financial 
accounts held in the name of A7 Network Sub-Agents. On the other side 
of the mirror trading system, the A7 Network employs its Sub-Agents to 
conduct fiat transactions--including U.S. dollars, yuan, dirhams, and 
euros--through the international financial system. FinCEN, through 
analysis of available financial data, found that more than 180 entities 
processed A7A5 transactions worth at least USD 179.1 billion, between 
February 2025 and June 2026. Historically, almost all of these 
transactions were processed through U.S.-, EU-, and/or UK-sanctioned 
entities, including Garantex and Grinex, and likely involved 
touchpoints with Russian banks; \54\ however following an alleged hack 
of Grinex in April 2026,\55\ A7A5 has been consolidated into unhosted 
wallets, suggesting the A7 Network may be moving away from using 
sanctioned exchanges.\56\
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    \52\ The term ``mirror transactions'' or ``mirror transfer'' is 
used by U.S. law enforcement to describe a money laundering typology 
involving foreign currency exchange. The process typically happens 
within Chinese underground banking and black market peso exchange 
schemes and usually involves a money broker or an accountant who 
conducts two equal, but separate, transactions involving at least 
two parties who often are unaware of each other. In this scheme, the 
broker or accountant makes payments to each party using the other 
parties' currency, ``mirroring'' or balancing the transactions. In 
the instance of the A7 Network, transactions within Russia using the 
A7A5 token ``mirror'' movements of fiat currency through ``Sub-
Agents,'' balancing the transactions while ensuring that the 
counterparties remain completely firewalled from one another. See 
Treasury, ``2024 National Money Laundering Risk Assessment'' (Feb. 
2024), at pp. 29-30. For more information about Chinese underground 
banking and the black market peso exchange, see FinCEN, FIN-2025-
A003, ``FinCEN Advisory on the Use of Chinese Money Laundering 
Networks by Mexico-Based Transnational Criminal Organizations to 
Launder Illicit Proceeds'' (Aug. 28, 2025).
    \53\ See June 2026 TRM Labs Report, supra note 12.
    \54\ See TRM Labs, ``The A7 Leaks: TRM's On-Chain Analysis of 
Russia's Cryptocurrency Connections'' (June 12, 2026), <a href="https://www.trmlabs.com/resources/blog/the-a7-leaks-trms-on-chain-analysis-of-russias-cryptocurrency-connections">https://www.trmlabs.com/resources/blog/the-a7-leaks-trms-on-chain-analysis-of-russias-cryptocurrency-connections</a>.
    \55\ See Elliptic, ``The fall of A7A5: how sanctions strangled 
the ruble stablecoin'' (July 29. 2026), <a href="https://www.elliptic.co/insights/the-fall-of-a7a5-how-sanctions-strangled-the-ruble-stablecoin/">https://www.elliptic.co/insights/the-fall-of-a7a5-how-sanctions-strangled-the-ruble-stablecoin/</a>.
    \56\ See Hannah Curtis, ``One wallet now holds 94.5% of A7A5's 
supply,'' Crystal Intelligence (July 30, 2026), <a href="https://crystalintelligence.com/stablecoin/one-wallet-now-holds-94-5-of-a7a5s-supply/">https://crystalintelligence.com/stablecoin/one-wallet-now-holds-94-5-of-a7a5s-supply/</a>.
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    The A7 Network has most often used the A7A5 tokens as a non-
freezable, bridging asset to convert into other, more widely accepted 
digital assets, such as the stablecoin Tether (USDT), and which may 
then be converted to the fiat currency of the customers choosing as 
another means of settling payments internationally.\57\ In order to 
maintain the necessary liquidity to operate, the A7 Network uses its 
Sub-Agents or other trusted intermediary entities, such as digital 
asset exchanges. This includes over-the-counter digital asset brokers 
(OTCs) \58\ outside of Russia operating in jurisdictions of concern for 
A7 Network activity--especially firms that are newly created or 
dramatically expanding their stablecoin trading operations--which could 
serve as A7 Network liquidity providers.\59\ In addition, FinCEN 
analysis indicates that U.S. financial institutions may encounter use 
of derivative or ``wrapped'' tokens distinct from but ``pegged'' to the 
A7A5 token that serve as a representation of the A7A5 token on a 
blockchain to which A7A5 is not native; \60\ wrapped tokens are often 
accessed through decentralized finance applications.\61\
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    \57\ See Elliptic, ``A7A5: The ruble-backed stablecoin crosses 
$100 billion in transactions'' (Jan. 21, 2026), <a href="https://www.elliptic.co/insights/a7a5-the-ruble-backed-stablecoin-100-billion-in-transactions/">https://www.elliptic.co/insights/a7a5-the-ruble-backed-stablecoin-100-billion-in-transactions/</a>; see also Elliptic, ``The fall of A7A5: how 
sanctions strangled the ruble stablecoin'' (July 29. 2026), Centre 
for Information Resilience ``A7A5: Circumventing sanctions with 
stablecoin cryptocurrency'' (June 25, 2025), at p. 9, <a href="https://www.info-res.org/app/uploads/2025/06/A7A5-Report-June-2025-Final-Draft-1.pdf">https://www.info-res.org/app/uploads/2025/06/A7A5-Report-June-2025-Final-Draft-1.pdf</a>.
    \58\ OTCs are money services businesses (MSBs) that conduct 
peer-to-peer exchanges of digital assets for fiat currency, or 
digital assets for digitals assets, between two parties without the 
use of a centralized digital asset exchange and usually involving 
large volumes. As part of the money laundering process, illicit 
actors often seek to convert digital assets, specifically 
stablecoins, into fiat currency via diffuse networks of OTC brokers 
in third countries. These OTCs can receive substantial fees from 
illicit actors for providing cash-out services that leverage proxy 
accounts to circumvent digital asset service providers' Customer Due 
Diligence (CDD) processes or exploit providers with weaker AML/CFT 
controls, among other tactics. See U.S. Department of the Treasury, 
2026 National Money Laundering Risk Assessment (Mar. 2026), at p. 
50, <a href="https://home.treasury.gov/system/files/246/2026-NMLRA.pdf">https://home.treasury.gov/system/files/246/2026-NMLRA.pdf</a>.
    \59\ The A7A5 token is only available for purchase on a small 
number of exchanges, most of which are sanctioned by the U.S., EU 
and/or UK; however, it is also traded using peer-to-peer exchangers 
and decentralized exchanges. See Centre for Information Resilience 
``A7A5: Circumventing sanctions with stablecoin cryptocurrency'' 
(June 25, 2025), at pp. 12-13, <a href="https://www.info-res.org/app/uploads/2025/06/A7A5-Report-June-2025-Final-Draft-1.pdf">https://www.info-res.org/app/uploads/2025/06/A7A5-Report-June-2025-Final-Draft-1.pdf</a>.
    \60\ A ``wrapped'' token is a digital asset that represents 
another digital asset on a non-native blockchain where the original 
asset is not offered. For example, a ``wrapped'' A7A5 token may 
offer trading of a representation of A7A5 on a blockchain other than 
A7A5's native blockchains. Wrapped tokens maintain a peg to the 
original asset, which is traditionally locked by a smart contract or 
maintained in a digital vault. See Securities and Exchange 
Commission and Commodity Futures Trading Commission, 17 CFR parts 
231 RIN 3235-AN56 and 241 and 17 CFR part 1 RIN 3038-AF67, 
``Application of the Federal Securities Laws to Certain Types of 
Crypto Assets and Certain Transactions Involving Crypto Assets'' 
(Mar. 23, 2026), <a href="https://www.sec.gov/files/rules/interp/2026/33-11412.pdf">https://www.sec.gov/files/rules/interp/2026/33-11412.pdf</a>. Wrapped tokens may also be created on the same blockchain 
as the original token to make them compatible with decentralized 
exchanges. See Centre for Information Resilience ``A7A5: 
Circumventing sanctions with stablecoin cryptocurrency'' (June 25, 
2025), at p. 13, <a href="https://www.info-res.org/app/uploads/2025/06/A7A5-Report-June-2025-Final-Draft-1.pdf">https://www.info-res.org/app/uploads/2025/06/A7A5-Report-June-2025-Final-Draft-1.pdf</a>.
    \61\ See Ethereum Foundation, ``Wrapped ether (WETH),'' <a href="https://ethereum.org/wrapped-eth/">https://ethereum.org/wrapped-eth/</a> (last accessed Aug. 20, 2026).
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    The A7 Network's well-established and far-reaching digital asset 
channels are an appealing tool for a wide range of threat actors. 
Analysis of public and nonpublic information reveals that Iranian 
actors are leveraging the A7 Network, including the Central Bank of 
Iran and the IRGC. Other illicit actors known to have used this network 
include North Korea (DPRK); Iran-backed terrorist organizations; 
cybercriminals and ransomware actors.\62\
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    \62\ See TRM Labs, ``The A7 Leaks: TRM's On-Chain Analysis of 
Russia's Cryptocurrency Connections'' (June 12, 2026), <a href="https://www.trmlabs.com/resources/blog/the-a7-leaks-trms-on-chain-analysis-of-russias-cryptocurrency-connections">https://www.trmlabs.com/resources/blog/the-a7-leaks-trms-on-chain-analysis-of-russias-cryptocurrency-connections</a>.
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    4. The A7 Network's Sub-Agents Are Used in Furtherance of 
International Money Laundering and Sanctions Evasion in Connection With 
Russian Illicit Finance
    As demonstrated above, the A7 Network's Sub-Agents play a key role 
in enabling, and facilitating, the A7 Network's activities. Based on 
analysis of public and nonpublic information, FinCEN assesses that, in 
the aggregate, the A7 Network's Sub-Agents have processed more than 17 
billion in USD-denominated transactions between January 2025 and June 
2026. Moreover, FinCEN has identified and assessed hundreds of Sub-
Agents of the A7 Network, finding that, based on public and nonpublic 
information, these Sub-Agents have (1) extensively facilitated 
transactions on behalf of, and for the benefit of, sanctioned Russian 
persons; (2) supported Russia's military operations in Africa; (3) 
enabled Iranian sanctions evasion, including transactions involving 
entities involved in the ``shadow fleet'' that Iran uses to illicitly 
sell oil; and (4) assisted at least one company involved in procurement 
for Iran's weapons programs.
    For instance, publicly identified \63\ Sub-Agents that FinCEN 
assesses engaged in illicit activity include:
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    \63\ All of the Sub-Agents discussed below were identified as 
Sub-Agents of the A7 Network. See Centre for Information Resilience, 
A7 Abroad: How A7 Sells International Sanctions Evasion as a Service 
(Oct. 2025), at pp. 19-20, <a href="https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf">https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf</a>.
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    <bullet> Power Sphere LLC-FZ. Power Sphere LLC-FZ is a Dubai, UAE-
based electronics supplier that purportedly trades in energy products, 
agricultural products, consumer goods, and food and beverages.\64\ 
However, FinCEN's

[[Page 63215]]

analysis of public and non-public information identified that between 
September 2023 and July 2025, Power Sphere LLC-FZ processed USD 61 
million in illicit funds tied to Russian trade-based money laundering 
and procurement activities in the energy sector.
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    \64\ Id. at p. 19.
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    <bullet> Hydrofusion Resources FZ-LLC. Hydrofusion Resources FZ-LLC 
is a UAE-based energy commodities trader that also purportedly trades 
in various other products, such as food and beverages, electronics, and 
heavy machinery.\65\ FinCEN's analysis of public and non-public 
information determined that between May and June 2025, Hydrofusion 
Resource FZ-LLC processed USD 3.6 million in illicit funds tied to 
Russian trade-based money laundering activity.
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    \65\ Id. at p. 20.
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    <bullet> Gimli Trade LLC-FZ. Gimli Trade LLC-FZ is a Dubai, UAE-
based trading firm that purportedly trades in food and beverages, 
household goods, cosmetic products, machinery, oil trading, and general 
trading.\66\ The company maintained an account at PSB in Russia, which 
was used to make ruble-denominated transactions.\67\ Gimli Trade LLC-FZ 
was sanctioned by the United Kingdom on December 18, 2025, for its 
involvement in providing financial support to the Russian 
government.\68\ FinCEN's analysis of public and non-public information 
determined that between May and June 2025, Gimli Trade LLC-FZ processed 
USD 1.5 million in illicit funds tied to Russian sanctions evasion.
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    \66\ Centre for Information Resilience, A7 Abroad: How A7 Sells 
International Sanctions Evasion as a Service (Oct. 2025), at p. 20, 
<a href="https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf">https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf</a>.
    \67\ Open Source Centre, The Big Shor: A7 and the illusion of 
Russian financial innovation (2026), at p. 34, <a href="https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf">https://static.opensourcecentre.org/assets/osc_a7_big_shor.pdf</a>.
    \68\ UK Foreign, Commonwealth and Development Office, Gimli 
Trade LLC-FZ (Dec. 18, 2025), <a href="https://search-uk-sanctions-list.service.gov.uk/designations/RUS3177/Entity?utm_content=&utm_medium=email&utm_name=&utm_source=govdelivery">https://search-uk-sanctions-list.service.gov.uk/designations/RUS3177/Entity?utm_content=&utm_medium=email&utm_name=&utm_source=govdelivery</a>
.
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    <bullet> Galadriel Trading FZCO. Galadriel Trading FZCO is a Dubai, 
UAE-based agricultural trading firm that purportedly trades commodities 
such as wheat, corn, barley, chickpeas, and vegetable oils.\69\ 
FinCEN's analysis of public and non-public information determined that 
between May and July 2025, Galadriel Trading FZCO processed more than 
USD 946,000 in illicit funds tied to Russian export control evasion.
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    \69\ Centre for Information Resilience, A7 Abroad: How A7 Sells 
International Sanctions Evasion as a Service (Oct. 2025), at p. 19, 
<a href="https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf">https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf</a>.
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    <bullet> Sigizmund FZCO. Sigizmund FZCO is a Dubai, UAE-based 
marketing management, research, and support consultancy firm.\70\ 
FinCEN's analysis of public and non-public information determined that 
between July and September 2025, Sigizmund FZCO processed USD 41,000 in 
illicit funds tied to Russian sanctions evasion, including the 
acquisition of dual-use goods.
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    \70\ Centre for Information Resilience, A7 Abroad: How A7 Sells 
International Sanctions Evasion as a Service (Oct. 2025), at p. 19, 
<a href="https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf">https://www.info-res.org/app/uploads/2025/10/A7-Abroad-FINAL-Copy.pdf</a>.
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    <bullet> Pearl Bridge. Pearl Bridge is a Dubai, UAE-based trading 
firm that purportedly specializes in precious metals, commodities, and 
other general trade.\71\ FinCEN's analysis of public and non-public 
information determined that in April 2025, Pearl Bridge processed 
approximately USD 30,000 in illicit funds tied to suspected Russian 
sanctions evasion activity.
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    \71\ Id.

Additionally, based on analysis of public and nonpublic information, 
there are indications that certain Sub-Agents have facilitated Iranian 
sanctions evasion efforts. One Sub-Agent engaged in direct transactions 
with other Sub-Agents and entities associated with Iran's shadow 
fleet--a network of oil tankers, shipping companies, and front 
companies used to transport and sell Iranian oil--indicating that 
Iranian actors have used the A7 Network and its infrastructure, 
including its Sub-Agents, in connection with sanctions-evasion 
activity. Between July 2023 and October 2025, the same A7 Sub-Agent and 
one of its sister companies received nearly USD 140 million from 
entities involved in Iranian sanctions evasion. In a separate instance, 
based on public and nonpublic information, FinCEN assess that another 
A7 Network Sub-Agent transferred approximately USD 1.6 million, between 
January 2024 and September 2025, to a company linked to Iranian 
sanctions evasion and weapons procurement efforts.
    Across fiat and digital asset-based settlement mechanisms, the A7 
Network's well-established and far-reaching constellation of Sub-Agents 
have provided a tool for threat actors to engage in a wide array of 
illicit activity, including sanctions evasion.

B. The Extent to Which Transactions Involving any Sub-Agent of the A7 
Network Involve Legitimate Business Activity

    In reaching its finding, FinCEN has considered the extent to which 
transactions involving any Sub-Agent are used for legitimate business 
purposes.\72\ As discussed above, the A7 Network's Sub-Agents are used 
to facilitate illicit activities by illicit actors. Although some 
components of the A7 Network, including its known Sub-Agents, may offer 
services that could potentially be used by licit actors, the A7 
Network's own creators, acknowledge its services are expressly designed 
to circumvent U.S. and international sanctions placed on the operators, 
owners, and enablers of the A7 Network \73\ and licit actors would have 
access to other, more established channels through which they might 
direct financial activity. Accordingly, given the extensive flow of 
illegitimate funds through the A7 Network, FinCEN assesses that the 
need to protect U.S. financial institutions from the money laundering 
risks presented by the A7 Network outweighs any potential legitimate 
utility its services may provide.
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    \72\ See 31 U.S.C. 5318A(c)(2)(B)(ii).
    \73\ Kommersant, Investment Cooperation Between Russia and 
China: Growth Points. Kommersants Session at the Third Russia-China 
International Forum (Aug. 19, 2025), at p. 2, <a href="https://www.events.kommersant.ru/events/sessiya-na-rostki-2025">https://www.events.kommersant.ru/events/sessiya-na-rostki-2025</a>.
---------------------------------------------------------------------------

C. The Extent to Which This Proposed Action Would Guard Against the 
Risks Posed by Transactions Involving any Sub-Agent of the A7 Network

    A finding that transactions involving any Sub-Agent of the A7 
Network are a class of transactions of primary money laundering concern 
in connection with Russian illicit finance establishes--and 
emphasizes--the significant illicit finance risks posed by the A7 
Network and its Sub-Agents. This finding will place U.S. and foreign 
financial institutions and regulators on notice to guard against those 
risks.\74\ Moreover, as Sub-Agents of the A7 Network are, by design, 
challenging to readily identify, such a finding--in combination with a 
prohibition on certain transmittals of funds by covered financial 
institutions--will safeguard the U.S. financial system, by assisting 
financial institutions in identifying Sub-Agent and severing access.
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    \74\ See 31 U.S.C. 5318A(c)(2)(B)(iii).
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IV. Proposed Special Measure

    Having found that transactions involving any Sub-Agent of the A7

[[Page 63216]]

Network are a class of transactions of primary money laundering concern 
in connection with Russian illicit finance, FinCEN proposes imposing a 
prohibition on certain transmittals of funds involving any of the A7 
Network's Sub-Agents.\75\ In making this determination and assessing 
which special measures may be appropriate, FinCEN has considered the 
relevant evidence in light of factors identified in 31 U.S.C. 
5318A(a)(4)(B). While FinCEN is under no obligation pursuant to section 
9714(a) to consider any particular factor or set of factors in 
selecting one or more special measures, it nonetheless finds these 
factors instructive in guiding the analysis set forth below.\76\
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    \75\ In connection with this action, and consistent with 31 
U.S.C. 5318A(a)(4)(A), FinCEN consulted with staff at the following 
Departments and agencies with regard to the proposed rule and 
prohibition: the Department of Justice; the Department of State; the 
Board of Governors of the Federal Reserve System; the Federal 
Deposit Insurance Corporation; the Securities and Exchange 
Commission; the Commodity Futures Trading Commission; the Office of 
the Comptroller of the Currency; and the National Credit Union 
Administration. Neither the Departments nor agencies objected to the 
issuance of this NPRM based on the information provided to staff at 
the time of this consultation.
    \76\ 31 U.S.C. 5318A(a)(4)(B) provides, as relevant here, that 
in selecting which special measure(s) to take, the Secretary shall 
consider:
    (1) Whether similar action has been or is being taken by other 
nations or multilateral groups;
    (2) Whether the imposition of any particular special measure 
would create a significant competitive disadvantage, including any 
undue cost or burden associated with compliance, for financial 
institutions organized or licensed in the United States;
    (3) The extent to which the action or the timing of the action 
would have a significant adverse systemic impact on the 
international payment, clearance, and settlement system, or on 
legitimate business activities involving the particular 
jurisdiction, institution, class of transactions, or type of 
account; and
    (4) The effect of the action on United States national security 
and foreign policy.
---------------------------------------------------------------------------

    As noted above, OFAC has not only designated the A7 Network as a 
significant TCO, but also designated, and imposed restrictions upon, 
certain core actors and components of the A7 Network--namely, A7 LLC, 
A71 LLC, A7 Agent LLC, Old Vector LLC, Garantex, Grinex, InDeFi Bank, 
ExVed, Mendeleev, Ilan Shor, and PSB, as well as certain other persons 
whose property and interests in property have been blocked, by 
designation, order, or by operation of law. The proposed imposition of 
a special measure would reinforce those existing restrictions, and 
importantly, the purposes served by this proposed action differ from 
the purposes of the existing economic sanctions. Apart from the 
rationale and purposes of the existing sanctions, this action is 
specifically designed to address a significant money laundering threat 
to the U.S. and international financial systems premised on the 
Secretary's determination that transactions involving any Sub-Agent of 
the A7 Network poses an unacceptable risk of money laundering and other 
financial crimes.
    Further, this action is intended to encourage other jurisdictions--
as well as financial institutions throughout the world--to take similar 
steps to sever the A7 Network and its Sub-Agents from the international 
financial system.
    Notwithstanding the differing purposes of the existing sanctions 
and the special measure proposed in this NPRM, the proposed special 
measure is intended to apply in concert, not conflict with the existing 
sanctions. Covered financial institutions should block and report to 
OFAC any accounts or transactions that are blocked pursuant to any 
applicable OFAC sanctions authority, and to the extent required or 
necessary, continue to maintain any blocked accounts in accordance with 
the Reporting Procedures and Penalties Regulations, 31 CFR part 501. 
And, for avoidance of doubt, if there is an apparent conflict between 
an obligation to block property or interests in property under existing 
OFAC sanctions and the requirements of this proposed special measure, 
covered financial institutions should comply with the obligation to 
block and, in doing so, would be deemed to comply with the requirements 
of this proposed special measure.

A. Whether the Proposed Special Measure Would Address the Money 
Laundering Concern in a Manner Consistent With U.S. National Security 
and Foreign Policy Interests

    FinCEN has considered the effect this proposed special measure will 
have on U.S. national security and foreign policy, as well as the 
extent to which multilateral groups or other nations have taken similar 
action.\77\ Given that the A7 Network's Sub-Agents' association with 
sanctioned persons and other actors involved in illicit activity, for 
the purpose of furthering sanctions evasion, FinCEN assesses that 
imposing a prohibition on certain transmittals of funds involving the 
A7 Network's Sub-Agents is necessary to safeguard U.S. national 
security and the U.S. financial system, as well as serve key U.S. 
national security objectives. Specifically, prohibiting certain 
transmittals of funds involving any of the A7 Network's Sub-Agents 
would insulate the U.S. financial system from international money 
laundering and other financial crimes, further ongoing U.S. efforts to 
curtail suspected sanctions evasion and related illicit activity tied 
to Russian and Iranian illicit finance, and sever a significant pathway 
that facilitates circumvention of U.S. and other sanctions, supporting 
the efficacy of U.S. sanctions and complementing previous actions taken 
by the U.S. government.
---------------------------------------------------------------------------

    \77\ See 31 U.S.C. 5318A(a)(4)(B)(i), (iv).
---------------------------------------------------------------------------

B. Whether the Proposed Special Measure Would Create Undue Burdens on 
Any Legitimate Activity of the A7 Network's Sub-Agents or Third Parties

    FinCEN has considered whether the proposed prohibition on certain 
transmittals of funds would create a significant competitive 
disadvantage, including any undue cost or burden associated with 
compliance, for financial institutions organized or licensed in the 
United States as affected third parties, as well as the extent to which 
the action could have a significant adverse systemic impact on 
legitimate business activities involving the A7 Network's Sub-Agents. 
As noted above, FinCEN assesses that to the extent the A7 Network Sub-
Agents are engaged in licit activity, such activity is relatively 
minimal compared to the sanctions evasion and illicit financial 
activity that flows through these Sub-Agents. Moreover, these Sub-
Agents operate companies in a variety of industries and the disperse 
nature of these businesses underscores that any overall impacts from 
any decrease in legitimate commercial or financial activity by these 
Sub-Agents is likely de minimis.
    When considering the anticipated burden on covered financial 
institutions, FinCEN assesses that the proposed prohibition is unlikely 
to impose a significant competitive disadvantage on any one particular 
financial institution organized or licensed in the United States as a 
consequence of business forgone due to the proposed prohibition given 
that the A7 Network's Sub-Agents uses of hundreds of Sub-Agents across 
a wide number of financial institutions, globally. Further, compliance 
with the proposed prohibition on certain transmittals of funds set out 
in this NPRM should not require tools or competencies other than those 
already employed by domestic financial institutions to maintain their 
current AML/CFT compliance programs and/or sanctions compliance 
programs. To ensure that minimal additional burden would attach to 
compliance with the proposed rule, FinCEN has elected to

[[Page 63217]]

provide for the rejection of certain transmittals of funds that are 
received from or originate with A7 Network Sub-Agents and outline the 
steps a covered financial institution should take in such circumstances 
to satisfy the proposed requirements. Further, upon issuance of a Final 
Rule, FinCEN is prepared to aid covered financial institutions in 
compliance with this NPRM, by providing additional information 
regarding known Sub-Agents, as appropriate, through a secure 
communications channel and proposes to limit the obligation on covered 
financial institutions to prohibit certain transmittals to only those 
entities on the provisioned list(s), which may be updated over time, as 
FinCEN, for instance, identifies additional Sub-Agents.

C. Whether Any Other Reasonable Alternatives or Special Measures Would 
Adequately Address the Money Laundering Concern

    In assessing the appropriate special measure to impose, FinCEN 
considered alternatives to a prohibition on certain transmittal of 
funds, including the imposition of one or more of the first five 
special measures. Having considered these alternatives, FinCEN 
assesses, for the reasons set out below, that a special measure 
prohibiting certain transmittals of funds involving the A7 Network's 
Sub-Agents is the most appropriate means to adequately address the 
illicit finance risks posed by the A7 Network's Sub-Agents and the need 
to prevent it from accessing the U.S. financial system. None of the 
special measures set out in 31 U.S.C. 5318A--special measures one 
through five--would effectively address the illicit finance threat 
posed by the A7 Network's Sub-Agents.\78\ Any additional recordkeeping, 
information collection, or reporting requirements, as described in 31 
U.S.C 5318A(b)(1)-(4), would be insufficient to guard against the risks 
posed by covered financial institutions processing transmittals of 
funds involving the A7 Network's Sub-Agents. Those special measures 
would allow such transfers to continue to benefit illicit actors 
connected to Russian illicit finance and Iranian sanctions evasion. 
Further, prohibiting or placing conditions upon the opening or 
maintaining in the United States of correspondent accounts or payable-
through accounts for or on behalf of the A7 Network's Sub-Agents, as 
described in 31 U.S.C 5318A(b)(5) would be similarly inadequate. 
Neither prohibiting nor imposing conditions on such accounts would 
safeguard the U.S. financial system to the same degree as prohibiting 
transmittals of funds, as such a special measure would not address the 
movement of funds outside of a strict correspondent or payable-through 
relationship, for example, through the movement of funds outside the 
traditional banking relationship, including because the types of CVC 
transactions, namely A7A5-related transactions (which are an integral 
part of the A7 Network's business model), do not rely on the 
correspondent banking system. FinCEN therefore assesses that such a 
prohibition is the most appropriate special measure to protect the U.S. 
financial system.
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    \78\ Likewise, imposing conditions on transmittals of funds, 
pursuant to section 9714(a)(2), would be insufficient to address the 
threat. While imposing conditions, rather than a full prohibition, 
may be appropriate in circumstances where the institution provides 
services for legitimate business that are not easily replicated or 
where a complete prohibition on transactional activity would 
otherwise unduly harm legitimate economic activity, the A7 Network's 
Sub-Agents provide a service that, by design, is intended to benefit 
sanctioned persons. And, to the extent that the A7 Network carries 
on any legitimate activity, FinCEN assesses that such services would 
be easily obtainable for legitimate customers through other 
providers. Accordingly, in this case the value of any legitimate 
activity it may conduct is outweighed by the significant proportion 
of illicit financial activity identified and its lack of mandatory 
Know Your Customer controls.
---------------------------------------------------------------------------

D. Whether the Proposed Prohibition Should Be Imposed by Order or 
Regulation

    Pursuant to section 9714, the Secretary may impose specified 
special measures, including a prohibition on certain transmittals of 
funds, ``by order, regulation or otherwise as permitted by law.'' In 
determining the appropriate approach in this instance, FinCEN 
considered imposing special measures by order or regulation, taking 
into account the nature of the underlying threat, and determined that 
proceeding by an NPRM is the most appropriate course of action, as that 
approach appropriately balances the risks posed by the A7 Network, with 
the interest in ensuring that covered financial institutions have an 
opportunity to comment on the proposed mechanisms through which FinCEN 
will identify Sub-Agents (as discussed below).
    A copy of this NPRM will be published in the Federal Register. To 
the extent the A7 Network's Sub-Agents or parties have information 
relevant to this NPRM, they may submit it to FinCEN at <a href="http://www.fincen.gov/contact">http://www.fincen.gov/contact</a>.

V. Section-by-Section Analysis

    The goal of this proposed rule is to combat and deter illicit 
activity, including Russian and Iranian sanctions evasion through the 
A7 Network's Sub-Agents, and to prevent the A7 Network's Sub-Agents 
from using the U.S. financial system to enable illicit financial 
activity. The subsections below discuss the respective portions of the 
proposed rule, which is separately presented in Section IX. 
Importantly, nothing in this NPRM should be construed to modify, 
impair, or otherwise affect any requirements or obligations to which a 
covered financial institution is subject pursuant to the BSA, 
including, but not limited to, the filing of Suspicious Activity 
Reports, or other applicable laws or regulations, such as the sanctions 
administered and enforced by OFAC.

A. Definitions

1. A7 Network
    The term ``A7 Network'' means the core grouping of entities and 
persons involved in the operation of a Russian-Kyrgyzstan based 
sanctions evasion and money laundering network including: A7 LLC, A71 
LLC, A7 Agent LLC, Old Vector LLC, Garantex, Grinex, InDeFi Bank, 
Mendeleev, Ilan Shor, and PSB, and any other persons whose property and 
interests in property have been blocked, by designation, order, or by 
operation of law, in light of their connection to the A7 Network.\79\
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    \79\ Persons whose property and interests in property are 
blocked pursuant to an Executive Order or regulations administered 
by OFAC (blocked persons) are considered to have an interest in all 
property and interests in property of an entity in which such 
blocked persons own, whether individually or in the aggregate, 
directly or indirectly, a 50 percent or greater interest. 
Consequently, any entity owned in the aggregate, directly or 
indirectly, 50 percent or more by one or more blocked persons is 
itself considered to be a blocked person. The property and interests 
in property of such an entity are blocked regardless of whether the 
entity itself is listed in the annex to an Executive order or 
otherwise placed on OFAC's List of Specially Designated Nationals. 
Accordingly, a U.S. person generally may not engage in any 
transactions with such an entity, unless authorized by OFAC. In 
certain OFAC sanctions programs (e.g., Cuba and Sudan), there is a 
broader category of entities whose property and interests in 
property are blocked based on, for example, ownership or control. 
See OFAC, Revised Guidance on Entities Owned by Persons Whose 
Property and Interests in Property are Blocked (Aug. 13, 2014), 
<a href="https://ofac.treasury.gov/media/6186/download?inline">https://ofac.treasury.gov/media/6186/download?inline</a>.
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2. A7 Network Sub-Agents
    The proposed rule would define the A7 Network Sub-Agents as 
including, but not limited to, the following: Galadriel Trading FZCO, 
Gimli Trade LLC-FZ, Hydrofusion Resources FZ-LLC, Pearl Bridge, Power 
Sphere LLC-FZ, and Sigizmund FZCO, and any other entity identified by 
FinCEN as a Sub-Agent of the A7 Network.
    As suggested in this definition, to facilitate identifying entities 
that are

[[Page 63218]]

deemed Sub-Agents of the A7 Network, FinCEN would be prepared to 
provide--through secure means--covered financial institutions with 
additional information regarding known A7 Sub-Agents, as appropriate, 
and proposes limiting the obligation on covered financial institutions 
to prohibit certain transmittals only as to those entities identified 
on that list. Specifically, FinCEN would share that list with covered 
financial institutions through FinCEN's ``FI-Portal,'' a secure 
messaging system that FinCEN and covered financial institutions utilize 
to securely exchange information, as appropriate. That list will be 
updated periodically, both to add additional Sub-Agents as well as to 
remove Sub-Agents. Given the nature of the A7 Network and its 
operations (as discussed above), FinCEN is opting to securely provide 
this list only to covered financial institutions, as FinCEN has 
assessed that a broader public distribution of the list would undermine 
the purposes of the proposed rule--allowing the A7 Network to 
circumvent the proposed special measure through additional and new Sub-
Agents.
    Importantly, as proposed in this NPRM, that list would identify 
known Sub-Agents, for the purposes of compliance with the proposed 
special measure, and covered financial institutions would only be 
prohibited from engaging in certain transmittals of funds involving 
those Sub-Agents. Covered financial institutions would not, however, be 
prohibited from disclosing that, in the context of any particular 
transaction, they have declined to proceed with the transaction because 
of party has been identified on FinCEN's list. Rather, as discussed 
below covered financial institutions would be required to affected 
persons associated with the transmittal of funds with which the covered 
financial institution maintains a direct commercial relationship.
    And, as discussed below, should an entity seek to challenge being 
identified as a Sub-Agent, FinCEN has set out a process by which the 
aggrieved party may petition for reconsideration of their inclusion on 
the list. Should an aggrieved identified Sub-Agent successfully 
challenge the determination, FinCEN would update the list accordingly.
3. Convertible Virtual Currency (CVC)
    The term ``convertible virtual currency (CVC)'' means a medium of 
exchange that either has an equivalent value as currency, or acts as a 
substitute for currency, but lacks legal tender status. Despite having 
legal tender status in at least one jurisdiction, for the purpose of 
this NPRM, the A7A5 stablecoin is included as a type of CVC.
4. Covered Financial Institution
    The term ``covered financial institution'' has the same meaning as 
``financial institution'' in 31 CFR 1010.100(t).
5. Transmittals of Funds
    The term ``transmittals of funds'' means the sending and receiving 
of funds, including CVC. For avoidance of doubt, the definition of 
``transmittals of funds'' proposed here would only apply to section 
1010.668. The definition of transmittal of funds'' in section 
1010.100(ddd) would not apply to section 1010.668.
6. Recipient
    The Term ``Recipient'' means the person to be paid by the 
recipient's covered financial institution.
7. Meaning of Other Terms
    All terms used but not otherwise defined herein shall have the 
meaning set forth in 31 CFR Chapter X, 31 U.S.C. 5312, and 21 U.S.C. 
2302.

B. 1010.668(b)--Prohibition on Certain Transmittals of Funds for 
Covered Financial Institutions

1. Prohibition on Certain Transmittals of Funds
    Proposed section 1010.668(b)(1) prohibits covered financial 
institutions from engaging in a transmittal of funds involving any A7 
Network Sub-Agent, including any transmittal of funds from or to an A7 
Network Sub-Agent, or from or to any account or CVC address 
administered by or on behalf of an A7 Network Sub-Agent.
    In order to ensure that compliance with the proposed prohibition on 
certain transmittals of funds requires no tools or competencies other 
than those already employed by covered financial institutions to 
maintain their current AML/CFT compliance programs, FinCEN has elected 
to provide at proposed section 1010.668(b)(1)(i) for the rejection of 
certain transmittals of CVC that are received from or originate at A7 
Network Sub-Agent or from an account or CVC address administered by or 
on behalf of an A7 Network Sub-Agent and outline the steps a covered 
financial institution should take in such circumstances. In providing 
for the rejection of CVC under certain limited circumstances, FinCEN 
acknowledges that, at this time, there may be technological limitations 
that may limit or preclude covered financial institutions from 
declining CVC transfers originating at addresses outside of their 
control, and compliant institutions may find themselves in receipt of 
CVC that, despite a desire and effort to limit such exposure, would 
implicate the proposed prohibition.\80\ As such, proposed section 
1010.668(b)(1)(i) allows covered financial institutions the flexibility 
to act with discretion based on the facts and circumstances of a 
particular transaction and comply with the proposed prohibition, even 
where the originating address is no longer accessible. Moreover, by 
providing for the rejection of CVC, this order ensures that covered 
financial institutions will not be subject to an undue cost or burden 
associated with compliance.
---------------------------------------------------------------------------

    \80\ FinCEN notes that CVC payment systems are often designed to 
limit the control of specific financial institutions over 
transactions and to prevent rejections of funds by persons or 
entities other than the sender of funds. As a result, although 
covered financial institutions may institute an internal prohibition 
on the sending of CVC transactions to another address or entity, 
FinCEN assesses that there are few, if any, readily available ways 
for covered financial institutions to ``reject'' incoming CVC 
transactions (prior to receipt).
---------------------------------------------------------------------------

    Further, as the proposed special measure is intended to apply in 
concert, not conflict, with the existing sanctions, a note to proposed 
section 1010.668(b)(1) provides that covered financial institutions 
should block and report to OFAC any accounts or transactions that are 
blocked pursuant to any applicable OFAC sanctions authority, and to the 
extent required or necessary, continue to maintain any blocked accounts 
in accordance with the Reporting Procedures and Penalties Regulations, 
31 CFR part 501. As noted above and for avoidance of doubt, if there is 
an apparent conflict between an obligation to block property or 
interests in property under existing OFAC sanctions and the 
requirements of this proposed special measure, covered financial 
institutions should comply with the obligation to block and, in doing 
so, would be deemed to comply with the requirements of this proposed 
special measure.
2. Notification
    As a corollary to the prohibition set forth in proposed section 
1010.668(b)(1), proposed section 1010.668(b)(2) provides that, if a 
covered financial institution knows or has reason to believe a 
transmittal of funds involves any A7 Network Sub-Agent and that such 
transmittal of funds is prohibited pursuant to paragraph (b)(1), the 
covered financial institution must notify affected persons associated 
with the transmittal of funds with

[[Page 63219]]

which the covered financial institution maintains a direct commercial 
relationship. The purpose of this requirement is to ensure that persons 
affected by the proposed prohibition have an opportunity to understand 
the nature and impact of the proposed prohibition on their interests, 
as well as to facilitate compliance and to aid cooperation in 
preventing transactions involving the A7 Network's Sub-Agents from 
accessing the U.S. financial system. Pursuant to this requirement, 
covered financial institutions may notify affected persons directly or, 
through financial institutions of other intermediaries, indirectly. 
Methods of compliance with the notice requirement could include, for 
example, transmitting a notice by mail, fax, or email. Importantly, 
FinCEN does not propose requiring covered financial institutions to 
obtain a certification to comply with this notice requirement.
3. Procedures for Removal From the List of A7 Network Sub-Agents
    Pursuant to proposed section 1010.668(b)(3), FinCEN has proposed a 
mechanism through which entities identified as Sub-Agents might seek 
reconsideration. As set out in proposed section 1010.668(b)(2), covered 
financial institutions affected persons associated with the transmittal 
of funds with which the covered financial institution maintains a 
direct commercial relationship, including that a party to the 
transaction is a Sub-Agent of the A7 Network, and thus, identified on a 
list provided by FinCEN.
    In proposed section 1010.668(b)(3), FinCEN has proposed a petition 
process through which a person identified as a Sub-Agent might submit 
arguments or evidence to establish that there is insufficient grounds 
to establish that the person is a Sub-Agent or that circumstances have 
changed such that the person should no longer be identified as a Sub-
Agent. As set out in the proposed section, all such petitions should be 
submitted to FinCEN, in the first instance. FinCEN will then review and 
provide a written decision.
4. Special Due Diligence
    Pursuant to proposed section 1010.668(b)(4), covered financial 
institutions shall take a risk-based approach when deciding what, if 
any, other due diligence measures it reasonably must adopt to guard 
against processing prohibited transmittals of funds associated with 
transactions involving any A7 Network Sub-Agent. As contemplated by the 
proposed section, any such due diligence should include implementing 
risk-based procedures designed to identify transactions involving, and 
any use of any account to process transactions involving, any A7 
Network Sub-Agent. A covered financial institution would be expected to 
apply an appropriate screening mechanism to identify a transmittal of 
funds that involves any A7 Network Sub-Agent as an originator or 
beneficiary or otherwise references any A7 Network Sub-Agent in a 
manner detectable under the covered financial institution's normal 
screening mechanisms. An appropriate screening mechanism could be the 
mechanisms used by a covered financial institution to comply with 
various legal requirements, such as commercially available software 
programs used to comply with the economic sanctions programs 
administered by the OFAC.
5. Recordkeeping and Reporting
    Proposed section 1010.668(b)(5) clarifies that the proposed rule 
does not impose any reporting requirement upon any covered financial 
institution that is not otherwise required by applicable law or 
regulation. A covered financial institution must, however, document its 
compliance with the notification requirement described above in section 
1010.668(b)(3).

C. Reservation of Authority

    The proposal provides that FinCEN reserves its authority to impose 
conditions on certain transmittals of funds and to grant appropriate 
exemptions from the requirements proposed in this NPRM.

D. Request for Comments

    FinCEN is requesting comments for 30 days after the publication of 
this NPRM. Given the A7 Network and its Sub-Agents' consistent and 
longstanding ties to facilitating transactions for illicit actors, 
FinCEN assesses that a 30-day comment period for this NPRM strikes an 
appropriate balance between ensuring sufficient time for notice to the 
public and opportunity for comment on the proposed rule, while 
minimizing undue national security risk posed to the U.S. financial 
system in processing illicit transfers. FinCEN invites comments on all 
aspects of the proposed rule, including the following specific matters:
    1. FinCEN's proposal of a prohibition on certain transmittal of 
funds, as opposed to imposing special measures one through five or 
imposing conditions under any special measure;
    2. The form and scope of the notice to certain account holders that 
would be required under the rule; and
    3. The appropriate scope of the due diligence requirement in this 
proposed rule.

VI. Executive Order 14294

    Section 5 of Executive Order 14294 directs that all future notices 
of proposed rulemaking (NPRMs) and final rules published in the Federal 
Register, the violation of which may constitute criminal regulatory 
offenses, should include a statement identifying that the rule or 
proposed rule is a criminal regulatory offense and the authorizing 
statute.\81\ Executive Order 14294 directs agencies to draft this 
statement in consultation with the Department of Justice.
---------------------------------------------------------------------------

    \81\ Executive Order 14294, Fighting Overcriminalization in 
Federal Regulations, 90 FR 20367 (issued May 9, 2025; published May 
14, 2025), <a href="https://www.federalregister.gov/executive-order/14294">https://www.federalregister.gov/executive-order/14294</a>.
---------------------------------------------------------------------------

    Executive Order 14294 further directs that the regulatory text of 
all NPRMs and final rules with criminal consequences published in the 
Federal Register after May 9, 2025, should explicitly state a mens rea 
requirement for each element of a criminal regulatory offense, 
accompanied by citations to the relevant provisions of the authorizing 
statute.
    Willful violations of any final regulations set forth in this 
proposed rule may be subject to criminal penalties pursuant to 31 
U.S.C. 5322 and regulations promulgated in 31 CFR Chapter X. The 
statutory authority for criminal liability requires a mens rea of 
willfulness as an element pursuant to 31 U.S.C. 5322(a) and 31 U.S.C. 
5322(b). FinCEN's existing regulation, 31 CFR 1010.840, that sets out 
criminal penalties for violations of regulations promulgated in 31 CFR 
Chapter X also includes a mens rea of willfulness. In drafting this 
statement, FinCEN has consulted with the Department of Justice.

VII. Regulatory Impact Analysis

    FinCEN has analyzed this proposed rule under Executive Order 
12866,\82\ Executive Order 13563,\83\ the Regulatory Flexibility Act 
(RFA),\84\ the Unfunded Mandates Reform Act (UMRA),\85\ and the 
Paperwork Reduction Act (PRA).\86\ As discussed above,\87\ the intended

[[Page 63220]]

effects of the imposition of the proposed special measure with respect 
to the any A7 Network Sub-Agent are twofold. The proposed rule is 
expected to: (1) combat and deter money laundering in facilitation of 
Russian and Iranian illicit financing by the A7 Network's Sub-Agents; 
and (2) prevent A7 Network Sub-Agents from using the U.S. financial 
system to enable illicit financial activity.
---------------------------------------------------------------------------

    \82\ Executive Order 12866, Regulatory Planning and Review, 58 
FR 51735 (issued Sept. 30,1993; published Oct. 4, 1993).
    \83\ Executive Order 13563, Improving Regulation and Regulatory 
Review, 76 FR 3821 (issued Jan. 18, 2011; published Jan. 21, 2011).
    \84\ 5 U.S.C. 601 et seq.
    \85\ 2 U.S.C. 1532.
    \86\ 44 U.S.C. 3507(a)(1)(D).
    \87\ See supra Section V.
---------------------------------------------------------------------------

    In the analysis below, FinCEN discusses the economic effects that 
are expected to accompany adoption of the rule as proposed and assesses 
such expectations in more granular detail. This discussion includes an 
explanation of how the assumptions in FinCEN's cost model and 
methodological choices have influenced FinCEN's conclusions. The public 
is invited to comment on all aspects of FinCEN's practice.\88\
---------------------------------------------------------------------------

    \88\ See Sections VI and VIII.D.
---------------------------------------------------------------------------

A. Analysis of Impact

1. Institutional Baseline and Affected Parties
    To assess potential economic impact of the proposed rule, FinCEN 
took into account the baseline population of potentially affected 
financial institutions to which the proposed definition of ``covered 
financial institution'' would apply. A summary of these populations by 
type of financial institution is presented in table 1.

      Table 1--Estimates of Covered Financial Institutions by Type
------------------------------------------------------------------------
                                                           Number of
            Financial institution type \1\                 financial
                                                          institutions
------------------------------------------------------------------------
Banks \2\ or Persons Subject to Supervision by Any             \4\ 8,988
 State or Federal Bank Supervisory Authority \3\.....
Broker-Dealers \5\...................................          \6\ 3,277
Money Services Businesses (MSBs) \7\.................        \8\ 332,068
Telegraph Companies \9\..............................             \10\ 0
Casinos or Card Clubs \11\...........................         \12\ 1,304
Futures Commission Merchants (FCMs) or Introducing              \14\ 954
 Brokers in Commodities (IBCs) \13\..................
Mutual Funds \15\....................................         \16\ 1,335
                                                      ------------------
    Total............................................            347,926
------------------------------------------------------------------------
\1\ See 31 U.S.C. 5312(a)(2); see also 31 CFR 1010.100(t) (definition of
  financial institution).
\2\ See 31 CFR 1010.100(t)(1); see also 31 CFR 1010.100(d).
\3\ See 31 CFR 1010.100(t)(7)
\4\ This includes 4,336 Federal Deposit Insurance Corporation- (FDIC-
  )insured depository institutions (i.e., federally regulated banks)
  according to the FDIC's Quarterly Bank Profile for Q4 2025, p. 2
  (<a href="https://www.fdic.gov/quarterly-banking-profile/past-quarterly-banking-profiles">https://www.fdic.gov/quarterly-banking-profile/past-quarterly-banking-profiles</a> profiles). It also includes 4,287 National Credit Union Administration
  (NCUA) insured credit unions as of December 31, 2025, according to
  NCUA's Quarterly Credit Union Data Summary: 2025 Q4, p. I (<a href="https://ncua.gov/analysis/credit-union-corporate-call-report-data/quarterly-data-summary-reports">https://ncua.gov/analysis/credit-union-corporate-call-report-data/quarterly-data-summary-reports</a>). The Board of Governors of the Federal Reserve
  System Master Account and Services Database (<a href="https://www.federalreserve.gov/paymentsystems/master-account-and-services-database-existing-access.htm">https://www.federalreserve.gov/paymentsystems/master-account-and-services-database-existing-access.htm</a>) contains data as of November 30, 2025,
  on financial institutions that use Federal Reserve Bank financial
  services, including those with no additional Federal regulator. FinCEN
  used this data to identify 365 banks and credit unions with no
  additional Federal regulator using Federal Reserve Bank financial
  services. It is unclear to FinCEN at this time whether any entities
  exist in the ``Persons subject to supervision by any state or Federal
  bank supervisory'' category that, for purposes of being counted
  towards unique potentially affected parties that could incur burdens
  associated with regulations issued pursuant to 31 CFR 1010.668, are
  not already captured by concurrent status in another category of
  financial institution under the 31 CFR 1010.100(t) definition. To the
  extent that additional data can better inform this estimate, public
  comment including provision of such data is invited.
\5\ See 31 U.S.C. 5312(a)(2)(G); see also 31 CFR 1010.100(t)(2).
\6\ This estimate is based on U.S. Securities and Exchange Commission
  (SEC) data on active broker-dealers available at ``Company Information
  About Active Broker-Dealers'' (<a href="https://www.sec.gov/foia-services/frequently-requested-documents/company-information-about-active-broker-dealers">https://www.sec.gov/foia-services/frequently-requested-documents/company-information-about-active-broker-dealers</a> dealers), which listed 3,277 active broker-dealers registered with the
  SEC as of December 31, 2025.
\7\ See 31 U.S.C. 5312(a)(2)(J,K,R); see also 31 CFR 1010.100(t)(3) and
  31 CFR 1010.100(ff) (definition of MSB).
\8\ The definition of MSB (31 CFR 1010.100(ff)) covers both principal
  and agent MSBs. FinCEN estimated there were 24,856 uniquely
  identifiable registered principal MSBs with indicia of active business
  operations as of the three year-ends 2023-2025. FinCEN has estimated
  that the number of agent MSBs is approximately 307,212 based on
  internal data.
\9\ See 31 CFR 1010.100(t)(4)
\10\ As an estimate of uniquely registered, potentially affected
  entities, FinCEN expects this category to contain no additional
  persons or organizations not already included in other counts,
  particularly as money transmitters.
\11\ See 31 U.S.C. 5312(a)(2)(X); see also 31 CFR 1010.100(t)(5)-(6).
\12\ This includes 1,304 casinos, as of December 31, 2025, from the
  American Gaming Association, State of the States 2026: The AGA
  Analysis of the Commercial Casino Industry, May 2026, p. 17 (<a href="https://www.americangaming.org/wp-content/uploads/2026/05/AGA-State-of-the-States-2026.pdf">https://www.americangaming.org/wp-content/uploads/2026/05/AGA-State-of-the-States-2026.pdf</a>).
\13\ See 31 U.S.C. 5312(a)(2)(H); see also 31 CFR 1010.100(t)(8-9).
\14\ According to Commodity Futures Trading Commission data on FCMs
  available at ``Financial Data for FCMs'' (<a href="https://www.cftc.gov/MarketReports/financialfcmdata/index.htm">https://www.cftc.gov/MarketReports/financialfcmdata/index.htm</a>), there were 66 registered
  FCMs as of December 31, 2025. The number of IBCs as of December 31,
  2025 (888) was obtained from the National Futures Association ``NFA
  Membership and Registration'' website (<a href="https://www.nfa.futures.org/registration-membership/membership-and-directories.html">https://www.nfa.futures.org/registration-membership/membership-and-directories.html</a>). Because
  deduplication of entities registered as both FCMs and IBCs was not
  feasible, this estimate may double-count some entities registered in
  both categories. FinCEN, however, believes this subpopulation may be
  small.
\15\ See 31 U.S.C. 5312(a)(2)(I); see also 31 CFR 1010.100(t)(10) and 31
  CFR 1010.100(gg).
\16\ This estimate is based on the number of registered investment
  companies filing Form N-1A in SEC's Annual Registered Investment
  Company Update: Form N-CEN Data, Period Ending December 2025, May
  2025, table1.3, p. 4 (<a href="https://www.sec.gov/files/annual-registered-investment-company-update-20260512.pdf">https://www.sec.gov/files/annual-registered-investment-company-update-20260512.pdf</a>).

    FinCEN also took certain current market practices into 
consideration as well as the regulatory baseline against which the 
proposed rule's expected effects can most meaningfully be assessed. 
These considerations include both the (1) current legal requirements 
and (2) the processes and technologies financial institutions use to 
comply with those requirements related to sanctions compliance, AML/CFT

[[Page 63221]]

program obligations, and the BSA, more broadly.
2. Description of the Proposed Requirements
    The proposed rule would require covered financial institutions to 
take reasonable steps not to process a transaction in the United States 
if such a transaction involves a Sub-Agent of the A7 Network. Covered 
financial institutions, under the proposed rule, must notify affected 
persons associated with the transmittal of funds with which the covered 
financial institution maintains a direct commercial relationship where 
the covered financial institution knows or has reason to believe the 
transmittal of funds is associated with any transaction that involves 
any A7 Network Sub-Agent and that such transmittal is prohibited. 
Further, covered financial institutions would be required to take a 
reasonable, risk-based approach to the adoption of any additional due 
diligence measures necessary to guard against the use of correspondent 
accounts to process transactions involving Sub-Agents of the A7 
Network.
3. Expected Economic Effects on Covered Financial Institutions
    FinCEN expects the economic effects of the proposed rule to vary 
substantially across financial institutions. As a threshold matter, of 
those financial institutions to whom the proposed definition of 
``covered financial institution'' would apply, many may not experience 
any economic impact beyond a de minimis cost of being familiarized with 
the proposed regulatory obligations if in practice they do not process 
any transactions involving Sub-Agents of the A7 Network nor would be 
likely to at a given point in the future. Furthermore, not all expected 
affected covered financial institutions would face the same costs 
associated with compliance due to the nature of the proposed rule, 
which includes certain provisions that allow for a covered financial 
institution's exercise of discretion and other provisions that are only 
required of certain, but not all, types of financial institutions.
    FinCEN conservatively estimates that of the population of 347,926 
potentially affected covered financial institutions, only ten percent, 
or approximately 35,000 are likely to incur more than a de minimis 
compliance burden in connection with the proposed special measure. This 
upper-bound estimate exceeds the observed proportions--which range from 
0.8 to one percent, of select subpopulations where the incidence or 
absence of a relevant policy nexus is observable for all institutions 
within a category of financial institutions over a given time period 
(which is not available across all covered types)--by a full order of 
magnitude.
    Of those more substantively impacted by the proposed rule, FinCEN 
expects that certain covered financial institutions would need to take 
on a broader set of newly required activities, and that, on average, 
this would amount to double the burden borne by covered financial 
institutions that would not face the expanded, or full, scope of the 
rule's proposed obligations. In particular, covered financial 
institutions that undertake notification activities and must consider 
and/or adopt additional due diligence measures on a risk-basis would be 
expected to incur additional costs accordingly. For purposes of burden 
estimation, FinCEN conservatively assumes that the full population of 
covered financial institutions it has previously estimated to maintain 
foreign correspondent accounts would incur the expanded, or full, 
burden, including those elements over which the proposed rule would 
allow the exercise of discretion. Population estimates of this 
subpopulation are presented in table 2.

Table 2--Estimates of Financial Institutions With Correspondent Accounts
                                 by Type
------------------------------------------------------------------------
                                                           Number of
              Financial institution type                   financial
                                                          institutions
------------------------------------------------------------------------
Banks or Persons Subject to Supervision by Any State
 or Federal Bank Supervisory Authority:
    Banks with a Federal Functional Regulator (FFR)..             \1\ 66
    Banks Without an FFR.............................             \2\ 12
Broker-Dealers.......................................             \3\ 29
FCMs or IBCs.........................................              \4\ 9
Mutual Funds.........................................             \5\ 12
                                                      ------------------
    Total............................................                128
------------------------------------------------------------------------
\1\ Data are from the Federal Financial Institutions Examination Council
  (FFIEC) Central Data Repository for Reports on Condition and Income
  (Call Reports) and Uniform Bank Performance Reports, available for
  most FDIC-insured institutions. Using this source of data, FinCEN
  determines that as of Q4 2025, approximately 66 banks (as defined by
  FinCEN regulations, see 31 CFR 1010.100(d)) would be affected by this
  proposed rule in any given year. Specifically, as of Q4 2025, there
  were approximately 66 banks that reported non-zero values for deposit
  liabilities of banks in foreign countries. Deposit liabilities in a
  foreign country is an indication that a bank maintains correspondent
  accounts with a foreign financial institution.
\2\ The Board of Governors of the Federal Reserve System Master Account
  and Services Database contains data on financial institutions that use
  Federal Reserve Bank financial services, including those with no
  additional Federal regulator. FinCEN used this data to identify an
  additional 12 international banking entities with no additional
  Federal regulator and that do not file Call Reports, but that are also
  likely to maintain correspondent accounts with a foreign financial
  institution.
\3\ Broker-dealers, unless they are publicly traded, are not required to
  make reports indicating whether they have foreign correspondent
  accounts or hold foreign deposits. FinCEN reviewed financial statement
  data from 10-Q and 6-K filings with the SEC and identified nine
  publicly traded broker-dealers with U.S. operations that reported
  foreign deposits. FinCEN also examined Suspicious Activity Reports
  filed by broker-dealers in 2024 to identify another two non-publicly
  traded broker-dealers who appeared likely to be maintaining foreign
  deposits. However, because many broker-dealers are not publicly
  traded--so there may be less information about their business publicly
  available--and because many did not file Suspicious Activity Reports,
  FinCEN conservatively estimates that the proportion of broker-dealers
  with foreign correspondent accounts is similar to the proportion for
  banks (approximately 0.9 percent). 0.9 percent of 3,277 active broker-
  dealers is approximately 29 broker-dealers assumed to have foreign
  correspondent accounts.
\4\ FCMs, IBCs, and mutual funds generally use intermediary U.S. banks
  to move and maintain client deposits and funds for investment.
  Therefore, it is unlikely that many of these institutions maintain
  direct correspondent accounts with foreign financial institutions
  outside of their existing upstream banking relationships. However,
  because these institutions may in some cases receive deposits from,
  make payments or other disbursements, or otherwise transact directly
  with foreign financial institutions, FinCEN conservatively estimates
  that the proportion of FCMs, IBCs, and mutual funds with foreign
  correspondent accounts is similar to the proportion for banks
  (approximately 0.9 percent). 0.9 percent of 954 active FCMs and IBCs
  is approximately nine FCMs and IBCs assumed to have foreign
  correspondent accounts.
\5\ 0.9 percent of 1,335 active mutual funds is approximately 12 mutual
  funds assumed to have foreign correspondent accounts.


[[Page 63222]]

    As described further in the PRA Analysis in Section VIII.E below, 
FinCEN anticipates that the recordkeeping and disclosure costs to 
covered financial institutions, on aggregate, may be up to 
approximately USD 18 million per year. However, given the volume of 
transactions conducted via the A7 Network, FinCEN considers the 
necessity to curtail facilitation by A7 Network Sub-Agents and the 
enhanced ability to do so via imposition of the proposed special 
measure commensurate.
4. Consideration of Alternatives
    As part of its analysis, FinCEN took into consideration select 
alternatives to the rule as proposed. These considerations, as 
discussed in Section IV.C, are incorporated here by reference.

B. Executive Orders

    Executive Orders 12866 and 13563 direct agencies to assess costs 
and benefits of available regulatory alternatives and, if regulation is 
necessary, to select regulatory approaches that maximize net benefits 
(including potential economic, environmental, public health and safety 
effects; distributive impacts; and equity). Executive Order 13563 
emphasizes the importance of quantifying both costs and benefits, 
reducing costs, harmonizing rules, and promoting flexibility.
    Based on the analysis in Section VIII.A, it has been determined 
that this proposed rule is not an economically significant regulatory 
action under section 3(f) of Executive Order 12866. Accordingly, 
further regulatory impact analysis is not required. Public comment is 
invited on the reasonableness and accuracy of this assessment.

C. Regulatory Flexibility Act

    When an agency issues a rulemaking proposal, the RFA requires the 
agency to ``prepare and make available for public comment an initial 
regulatory flexibility analysis'' that will ``describe the impact of 
the proposed rule on small entities.'' \89\ However, section 605 of the 
RFA allows an agency to certify a rule, in lieu of preparing an 
analysis, if the proposed rulemaking is not expected to have a 
significant economic impact on a substantial number of small entities.
---------------------------------------------------------------------------

    \89\ 5 U.S.C. 603(a).
---------------------------------------------------------------------------

    The population of affected covered financial institutions under the 
proposed rule is presented in table 3, which includes the estimated 
proportion, by category of financial institution, that would be 
considered small entities for purposes of RFA analysis.
BILLING CODE 4810-02-P

[[Page 63223]]

[GRAPHIC] [TIFF OMITTED] TP05OC26.000

BILLING CODE 4810-02-C

[[Page 63224]]

    Under the proposed special measure, covered financial institutions 
would be prohibited from facilitating or participating in certain 
transmittal of funds involving A7 Network Sub-Agents. As discussed 
above in Section VIII.A, FinCEN does not expect the rule to affect all 
financial institutions that it proposes to cover equally, and many, if 
not most small entities are less likely to incur substantive costs than 
de minimis ones because of their lower likelihood of interaction with 
A7 Network Sub-Agents.
    While small covered financial institutions would be required to 
take reasonable measures to detect and prevent the transmittal of funds 
involving A7 Network Sub-Agents, neither set of newly required 
activities proposed is expected to introduce significant incremental 
burdens relative to those covered financial institutions' current 
obligations and ongoing diligence activities. For example, all U.S. 
persons, including U.S. financial institutions, must comply with OFAC 
sanctions, and most covered U.S. financial institutions generally have 
suspicious activity reporting requirements and systems in place to 
screen transactions to comply with OFAC sanctions and section 9714(a) 
special measures administered by FinCEN. The systems that U.S. 
financial institutions have in place to comply with these requirements 
are expected to be easily modified to adapt to this proposed rule. 
FinCEN believes that the increase in burden would be minimal in part 
because FinCEN would provide a comprehensive list of A7 Network Sub-
Agents known to FinCEN to covered financial institutions, who in turn 
would simply incorporate the list into their existing screening tools 
and processes. Thus, the special due diligence that would be required 
under the proposed rule--i.e., preventing the transmittal of funds 
involving A7 Network Sub-Agents and the transmittal of notification to 
certain correspondent account holders--is not expected to require a 
significant change in due diligence activities for small U.S. financial 
institutions. For these reasons, FinCEN certifies that the proposals 
contained in this rulemaking are not expected to have a significant 
impact on a substantial number of small businesses.
    FinCEN invites comments from members of the public who believe 
there would be a significant economic impact on small entities from the 
imposition of a prohibition under the proposed special measure 
regarding A7 Network Sub-Agents.

D. Unfunded Mandates Reform Act

    Section 202 of the UMRA \90\ requires that an agency prepare a 
budgetary impact statement before promulgating a rule that may result 
in expenditure by the state, local, and tribal governments, in the 
aggregate, or by the private sector, of USD 193 million or more in any 
one year (USD 100 million in 1995, adjusted for 
inflation).<SUP>91 92</SUP> If a budgetary impact statement is 
required, section 202 of the UMRA also requires an agency to identify 
and consider a reasonable number of regulatory alternatives before 
promulgating a rule.
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    \90\ 2 U.S.C. 1532, Public Law 104-4 (Mar. 22, 1995).
    \91\ Id.
    \92\ The U.S. Bureau of Economic Analysis reports the annual 
value of the gross domestic product implicit price deflator for 
calendar year 1995 (the year UMRA was enacted), as 66.939, and as 
128.974 for the calendar year 2025 (the most recent available). 
Thus, the inflation-adjusted estimate for $100 million is 128.974 / 
66.939 x $100 million, or $192.7 million. U.S. Bureau of Economic 
Analysis, Table 1.1.9. Implicit Price Deflators for Gross Domestic 
Product, BEA Interactive Data Application.
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    FinCEN has determined that this proposed rule would not result in 
expenditures by state, local, and tribal governments in the aggregate, 
or by the private sector, of USD 193 million or more in any one year. 
Accordingly, FinCEN has not prepared a budgetary impact statement or 
considered the regulatory alternatives outlined in Section IV.C above 
within the framework of the UMRA.

E. Paperwork Reduction Act

    The recordkeeping and disclosure requirements contained in this 
proposed rule that qualify as ``collections of information'' under the 
PRA will be submitted to the Office of Management and Budget (OMB) for 
review in accordance with the PRA.\93\ Under the PRA, an agency may not 
conduct or sponsor, and a person is not required to respond to, a 
collection of information unless it displays a valid control number 
assigned by the OMB.\94\ Written comments and recommendations for the 
proposed prohibition can be submitted by visiting <a href="http://www.reginfo.gov/public/do/PRAMain">www.reginfo.gov/public/do/PRAMain</a>. Find this particular document by selecting 
``Currently under Review--Open for Public Comments'' or by using the 
search function. Comments are welcome and must be received by November 
4, 2026. In accordance with requirements of the PRA, 44 U.S.C. 
3506(c)(2)(A), and its implementing regulations, 5 CFR part 1320, the 
following information concerning the collection of information as 
required by 31 CFR 1010.668 is presented to assist those persons 
wishing to comment on the information collections.
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    \93\ See 44 U.S.C. 3507(a)(1)(D). The PRA defines a ``collection 
of information'' as ``the obtaining, causing to be obtained, 
soliciting, or requiring the disclosure to third parties or the 
public, of facts or opinions by or for an agency, regardless of form 
or format, calling for either (i) answers to identical questions 
posed to, or identical reporting or recordkeeping requirements 
imposed on, ten or more persons, other than agencies, 
instrumentalities, or employees of the United States; or (ii) 
answers to questions posed to agencies, instrumentalities, or 
employees of the United States which are to be used for general 
statistical purposes[.]'' See 44 U.S.C. 3502(3).
    \94\ 44 U.S.C. 3507(a)(3).
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    The provisions in this proposed rule pertaining to the collection 
of information can be found in section 1010.668(b). The notification 
requirement in section 1010.668(b)(2) are intended to aid cooperation 
from foreign account holders in preventing transactions involving any 
A7 Network Sub-Agent from being processed by the U.S. financial system. 
The information required to be maintained by section 1010.668(b)(5) 
would be used by federal agencies and certain self-regulatory 
organizations to verify compliance by covered financial institutions 
with the requirements in section 1010.668(b). The collection of 
information would be mandatory.
    Frequency: As required.
    Description of Affected Financial Institutions: Only those covered 
financial institutions defined in section 1010.668(a)(4) that are 
engaged in certain transmittals of funds as defined in proposed section 
1010.668(a)(5) with, or processing transactions potentially involving, 
A7 Network Sub-Agents as defined in section 1010.668(a)(1) and (2) are 
expected to incur incremental economic effects.\95\
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    \95\ FinCEN recognizes that the petition process that would be 
provided under proposed 31 CFR 1010.668(b)(3) would also generate 
required paperwork and thereby impose burden on affected 
respondents. However, because (1) a petition is only expected to be 
undertaken by a listed A7 Network Sub-Agent that believed itself 
capable of demonstrating why it should be removed from the list and 
(2) the likelihood of this occurring 10 or more times in a given 
year is exceptionally low, FinCEN has not estimated or assigned a 
separate PRA burden to the reporting, recordkeeping, or disclosure 
activities accompanying proposed subsection 1010.668(b)(3).
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    Estimated Number of Potential Respondents: 347,926 covered 
financial institutions.
    Estimated Number of Expected Respondents: 34,793 covered financial 
institutions.
    Estimated Average Annual Burden in Hours per Affected Financial 
Institution: Imposing the special measure described in this proposed 
rule is expected to result in a new, incremental recordkeeping and 
potential disclosure burden on certain

[[Page 63225]]

covered financial institutions as described above.
    The estimated burden includes the time required to determine 
whether a notification is required, prepare and transmit any 
notifications required under 1010.668(b)(2), and create and maintain 
the records required under 1010.668(b)(5). This estimated average 
annual burden in this proposed rule is, in total, one business day, or 
eight hours per affected financial institution with expanded 
obligations (n = 128) and, in total, one-half business day, or four 
hours per affected financial institution under more limited 
requirements (n = 34,665).
    Estimated Total Annual Burden: Approximately 139,700 hours.\96\
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    \96\ (128 financial institutions with expanded obligations x 8 
hours per institution) + (34,665 financial institutions with limited 
obligations x 4 hours per institution)) = 139,682 hours = ~ 139,700 
hours.
---------------------------------------------------------------------------

    Estimated Total Annual Cost: Approximately USD 17,740,000.\97\
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    \97\ The wage rate applied here is a general composite hourly 
wage (USD 89.24), scaled by a private-sector benefits factor of 1.42 
(USD 127.03 = USD 89.24 x 1.42). This incorporates Bureau of Labor 
Statistics (BLS) mean wage data associated with the six occupational 
codes (11-1010: Chief Executives; 11-3021: Computer and Information 
Systems Managers; 11-3031: Financial Managers; 13-1041: Compliance 
Officers; 23-1010: Lawyers and Judicial Law Clerks; 43-3099: 
Financial Clerks, All Other) for each of the nine groupings of North 
American Industry Classification System industry codes that FinCEN 
determined are most directly comparable to its 11 categories of 
potentially affected financial institutions as delineated in 31 CFR 
parts 1020 to 1030. See BLS, May 2025--National industry-specific 
and by ownership, <a href="https://www.bls.gov/oes/tables.htm">https://www.bls.gov/oes/tables.htm</a>. Given that 
many occupations provide benefits beyond wages (e.g., insurance and 
paid leave), FinCEN applies the private sector benefit factor to the 
unloaded wage rate to reflect the total cost to the employer. The 
benefit factor is the ratio of total compensation (which includes 
wages and benefits) to wages. Total compensation = USD 45.65 and 
Wages and salaries = USD 32.07 (1.42 = USD 45.65 / USD 32.07) as of 
June 2025, based on the private industry workers series data 
downloaded from BLS, Employer Costs for Employee Compensation data, 
<a href="https://www.bls.gov/news.release/archives/ecec_09122025.pdf">https://www.bls.gov/news.release/archives/ecec_09122025.pdf</a>. 139,682 
total annual burden hours multiplied by USD 127.03 per hour equals a 
total annual cost of USD 17,743,855, or approximately USD 
17,740,000.
    See discussion of how compliance with the proposed rule is 
expected to be integrated into covered financial institutions' 
broader OFAC sanctions and 311 special measures compliance 
activities at Section X.B.
    See FinCEN, Renewal Without Change of Prohibition on 
Correspondent Accounts for Foreign Shell Banks; Records Concerning 
Owners of Foreign Banks and Agents for Service of Legal Process, 90 
FR 21987, 21994 (May 22, 2025), <a href="https://www.federalregister.gov/d/2025-09162/p-134">https://www.federalregister.gov/d/2025-09162/p-134</a>.
---------------------------------------------------------------------------

    General Request for Comments: Comments are invited on: (1) whether 
the proposed collection of information found in section 1010.668(b)(5) 
is necessary for the proper performance of the mission of FinCEN, 
including whether the information would have practical utility; (2) the 
accuracy of FinCEN's estimate of the burden of the proposed collection 
of information; (3) ways to enhance the quality, utility, and clarity 
of the information required to be maintained; (4) ways to minimize the 
burden of the required collection of information, including through the 
use of automated collection techniques or other forms of information 
technology; and (5) estimates of capital or start-up costs and costs of 
operation, maintenance, and purchase of services to report the 
information.

VIII. Regulatory Text

List of Subjects in 31 CFR Part 1010

    Administrative practice and procedure, Banks, banking, Brokers, 
Crime, Foreign banking, Terrorism.

Authority and Issuance

    For the reasons set forth in the preamble, FinCEN proposes amending 
31 CFR part 1010 as follows:

PART 1010--GENERAL PROVISIONS

0
1. The authority citation for part 1010 continues to read as follows:``

    Authority:  12 U.S.C. 1829b and 1951-1959; 31 U.S.C. 5311-5314, 
5316-5336; title III, sec. 314, Pub. L. 107-56, 115 Stat. 307; sec. 
2006, Pub. L. 114-41, 129 Stat. 458-459; sec. 701 Pub. L. 114-74, 
129 Stat. 599; sec. 6403, Pub. L. 116-283, 134 Stat. 3388.''

0
2. Add 1010.668 to read as follows:


1010.668  Special measures regarding any A7 Network Sub-Agent.

    (a)Definitions. For purposes of this section, the following terms 
have the following meanings. To the extent there is a differing 
definition in Sec.  1010.100 of this chapter, the definition in this 
Section is what applies to this Section.
    (1) A7 Network. The term ``A7 Network'' means the core grouping of 
entities and persons involved in the operation of a Russian-Kyrgyzstan 
based sanctions evasion and money laundering network including: A7 
Liability Company, A71 Limited Liability Company, A7 Agent Limited 
Liability Company, Old Vector LLC, Garantex, Grinex, Independent 
Decentralize Finance Smartbank and Ecosystem, ExVed, Sergey Mendeleev, 
Ilan Shor, and Promsvyazbank Public Joint Stock Company, and any other 
persons whose property and interests in property have been blocked, by 
designation, order, or by operation of law, in light of their 
connection to the A7 Network, an OFAC-designated TCO.
    (2) A7 Network Sub-Agents. The term ``A7 Network Sub-Agents'' means 
businesses including, but not limited to, the following: Galadriel 
Trading FZCO, Gimli Trade LLC-FZ, Hydrofusion Resources FZ-LLC, Pearl 
Bridge, Power Sphere LLC-FZ, and Sigizmund FZCO, and any other entity 
identified by FinCEN as a Sub-Agent of the A7 Network.
    (3) Convertible Virtual Currency (CVC). The term ``convertible 
virtual currency (CVC)'' means a medium of exchange that either has an 
equivalent value as currency, or acts as a substitute for currency, but 
lacks legal tender status. Despite having legal tender status in at 
least one jurisdiction, for the purpose of this NPRM, the A7A5 
stablecoin is included as a type of CVC.
    (4) Covered Financial Institution. The term ``covered financial 
institution'' has the same meaning as ``financial institution'' in 31 
CFR 1010.100(t).
    (5) Transmittals of Funds. The term ``transmittals of funds'' means 
the sending and receiving of funds, including convertible virtual 
currency. For avoidance of doubt, for this section this definition of 
transmittal of funds applies rather than the definition of transmittal 
of funds in section 1010.100(ddd).
    (6) Recipient. The Term ``Recipient'' means the person to be paid 
by the recipient's covered financial institution.
    (7) Meaning of Other Terms. All terms used but not otherwise 
defined herein shall have the meaning set forth in 31 CFR Chapter X, 31 
U.S.C. 5312, and 21 U.S.C. 2302.
    (b) Prohibition on transmittals of funds and due diligence 
requirements for covered financial institutions.
    (1) Prohibition of certain transmittals of funds. A covered 
financial institution is prohibited from engaging in a transmittal of 
funds involving any A7 Network Sub-Agent, including any transmittal of 
funds from or to an A7 Network Sub-Agent, or from or to any account or 
CVC address administered by or on behalf of an A7 Network Sub-Agent.
    (i) A covered financial institution will be deemed not to have 
violated this prohibition where, upon determining that it received CVC 
that originated from an A7 Network Sub-Agent or from an account or CVC 
address administered by or on behalf of an A7 Network Sub-Agent, that 
covered financial institution, if required under other authorities, 
blocks the CVC or rejects the transaction, preventing the intended 
Recipient from accessing such CVC and returning the CVC to the A7 
Network Sub-Agent, or to the account or CVC address from which the CVC 
originated.

    Note 1 to paragraph (b)(1): Covered financial institutions 
should block and report

[[Page 63226]]

to OFAC any accounts, property, or interests in property that are 
blocked pursuant to any OFAC sanctions authority and in compliance 
with the Reporting Procedures and Penalties Regulations, 31 CFR part 
501.

    (2) Notification. If a transmittal of funds is prohibited pursuant 
to paragraph (b)(1) or is blocked consistent with Note 1 to paragraph 
(b)(1), the covered financial institution must notify affected persons 
associated with the transmittal of funds with which the covered 
financial institution maintains a direct commercial relationship.
    (3) Procedures for Removal from the List of A7 Network Sub-Agents.
    (i) A person identified by FinCEN as an A7 Network Sub-Agent may 
submit petition presenting arguments or evidence that the person 
believes establishes that insufficient basis exists for the person to 
be identified as an A7 Network Sub-Agent or that the circumstances 
resulting in being identified as an A7 Network Sub-Agent no longer 
apply. This submission must be made via email to 
<a href="/cdn-cgi/l/email-protection#2e6942414c4f424740584b5d5a47494f5a4741405d6e4847404d4b4000494158"><span class="__cf_email__" data-cfemail="3572595a5754595c5b435046415c5254415c5a5b4675535c5b56505b1b525a43">[email&#160;protected]</span></a>.
    (ii) For the purposes of such petitions:
    (A) The information submitted by the person submitting a petition 
will be reviewed by FinCEN, which may request clarifying, 
corroborating, or other additional information.
    (B) A person submitting a petition may request a meeting with 
FinCEN; however, such meetings are not required, and FinCEN may, at its 
discretion, decline to conduct such meetings prior to completing a 
review of the petition.
    (C) After FinCEN has conducted a review of the petition, it will 
provide a written decision to the person that submitted the petition.
    (4) Special Due Diligence. A covered financial institution shall 
take a risk-based approach when deciding what, if any, other due 
diligence measures it reasonably must adopt to guard against processing 
prohibited transmittals of funds associated with transactions involving 
any A7 Network Sub-Agent.
    (5) Recordkeeping and reporting.
    (i) A covered financial institution is required to document its 
compliance with the notification requirement set forth in this section.
    (ii) Nothing in paragraph (b) of this section shall require a 
covered financial institution to report any information not otherwise 
required to be reported by law or regulation.

Jimmy L. Kirby,
Deputy Director, Financial Crimes Enforcement Network.
[FR Doc. 2026-20371 Filed 10-2-26; 8:45 am]
BILLING CODE 4810-02-P


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