The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has announced a $4,677,552 penalty against an individual identified as “U.S. Person-1” for violating sanctions on Russia and failing to comply with an OFAC subpoena. This is the statutory maximum penalty allowed.
According to OFAC, between April 2023 and March 2024, U.S. Person-1 acted through King Holdings LLC, a real estate investment company based in Atlanta, Georgia. During this period, U.S. Person-1 mortgaged, renovated, and sold residential property owned by a person sanctioned under OFAC’s Russia sanctions program. The sale was concealed from OFAC and also breached a cease-and-desist order issued by the agency.
In March 2022, OFAC had added a family member of a Russian oligarch to its sanctions list under Executive Order 14024. The family member directly owned residential property in the Atlanta area. At that point, all dealings involving the property—including transfer or sale—became prohibited without specific authorization from OFAC.
Local authorities in Fulton County, Georgia recorded public documentation about these restrictions at OFAC’s request. Despite this notice, the property entered foreclosure and was purchased by King Holdings at auction in January 2023. The property remained subject to blocking under U.S. sanctions regulations.
After learning about the foreclosure in April 2023, OFAC contacted U.S. Person-1 to clarify that the property was still blocked and could not be handled without proper authorization. The agency also advised that an application for a license could be submitted if necessary. Instead of following these instructions, U.S. Person-1 continued with plans to renovate and sell the property without seeking approval from OFAC.
While the sale was pending, OFAC issued both a cease-and-desist order and a subpoena to King Holdings regarding its activities related to the property. In response to the subpoena, U.S. Person-1 certified that their response was complete but did not disclose information about the sale; soon after responding, they finalized the transaction despite clear instructions not to proceed.
“Under President Trump’s leadership, the United States has put in place strong sanctions against Russia,” said Treasury Under Secretary for Terrorism and Financial Intelligence John K. Hurley. “Today’s action makes clear that Treasury will continue to actively investigate and hold accountable those who violate U.S. sanctions.”
This enforcement action underscores requirements for individuals and companies operating in real estate or other sectors to follow all relevant sanctions regulations set by OFAC.
For further details on this case or related enforcement actions by OFAC: https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions
