Despite international sanctions enacted following the invasion of Ukraine, Russia has continued to find ways to power its war machine and maintain industrial capacity:
- Sayari analysts documented how Russia is likely retaining access to the global financial market in part by exchanging gold for bulk cash through countries including the UAE and Turkey.
- Sayari data informed a recent Dutch investigative report on evasionary tactics used to import critical parts into Russia for use in shipbuilding efforts.
The latest Sayari investigation details Russia’s evolving tactics and reveals three emerging methods of sanctions evasion. One is a new twist on importing bulk cash.
Cash-for-seafood proves all that glitters isn’t gold
One way the U.S. and EU have sought to impede Russia’s ability to obtain foreign-made goods and technology — and engage in global commerce more broadly — is by blocking the export of USD and euro banknotes to Russia. The cash-for-gold tactic helped Russia receive bulk payments of USD and euros outside the traditional global banking system from which some Russian financial institutions are banned.
The need for foreign currency continues to be a critical requirement for Russia as global trade is dominated by these currencies. Therefore, Russia relies on foreign currency reserves to import a variety of goods and critical technology.
Sayari found that companies registered in U.S. ally Japan sent dozens of shipments of cash to Russia as legal tender in 2023. Japanese seafood and fishing companies sent payments to Russian counterparts shortly before or after receiving shipments of seafood from them, illuminating Russia’s efforts to use cash shipments to work around restrictions. Seafood is obviously not solely propping up Russia’s war machine, but it is notable that Russia exported over one billion USD worth of seafood to Japan in 2022. Thus, these cash-for-seafood trade flows represent one of many industries that Russia is able to keep afloat despite increasing restrictions to its activities worldwide.
Figure 1: Data from Sayari Graph shows a shipment from a Japanese seafood company to a Russian fishing company in December 2023, with the shipment of Japanese yen as legal tender for goods. Also in December, this Russian company shipped urchins to its Japanese counterpart, indicating that the banknote shipment could be payment for that seafood.
This recent Sayari investigation is one example of how Russia continually seeks out new markets, new commodities, and new techniques to backfill any existing source of cash eliminated through regulation.
Our analysis demonstrates how investigators can use global trade data and corporate records within Sayari Graph to piece together a more complete picture of sanctions evasion. Features like proprietary risk indicators that illuminate indirect exposure and the ability to search trade records for cash give enforcement teams the tools to conduct advanced sanctions investigations.
To learn more about the three emerging typologies in Russia’s sanctions evasion, read our latest report, Three Years On: Russia’s Evolving Tactics to Bolster its War Economy.
