How Correspondent Banking Can Enable Sanctions Evasion

A New York Times analysis of thousands of financial documents and transactions describes how the correspondent banking system can be used to sidestep U.S. sanctions. A Bank of America account ending in 0252 was linked to pooled funds drawn from customers of Zhejiang Chouzhou Commercial Bank in Yiwu, eastern China. The documents say Chouzhou handled payments for Russian front companies embedded in the global financial system. The practice, common in cross-border banking, can create a “nesting doll” effect where illicit activity is obscured through intermediaries. The report also cites A7, a Moscow-based firm whose records were exposed online by hackers, as facilitating restricted purchases worth over $10 million via an account held at Chouzhou.