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U.S. Treasury Official to Warn UAE, Turkey over sanctions evasion

WASHINGTON, Jan 28 – The U.S. Treasury Department’s top sanctions official, on a trip to Turkey and the Middle East next week, is warning countries and businesses that they could lose access to the U.S. market if they trade with entities subject to U.S. restrictions like Washington suppresses Russian attempts to avoid sanctions imposed in connection with the war in Ukraine.

Brian Nelson, the assistant secretary for terrorism and financial intelligence, will travel to Oman, the United Arab Emirates and Turkey from January 29 to February 3 and meet with government officials as well as businesses and financial institutions to reiterate that Washington will continue to aggressively pursue its sanctions, a Treasury spokesman told Reuters.

“Individuals and institutions operating in permissive jurisdictions risk potentially losing access to US markets due to trading with sanctioned entities or failing to exercise appropriate due diligence,” the spokesperson said.

While in the region, Nelson will discuss the Treasury Department’s efforts to crack down on Russia’s efforts to evade sanctions and export controls imposed over its brutal war against Ukraine, Iran’s destabilizing activity in the region, illicit financial risks undermining economic growth and foreign investment.

The trip is the latest visit by a senior Treasury official to Turkey to discuss sanctions, following a series of warnings last year from Treasury and Commerce officials as Washington stepped up pressure on Ankara to ensure US restrictions on Russia are enforced.

STRETCHED RELATIONSHIPS

Nelson’s trip coincides with a period of strained relations between the United States and Turkey, with the two NATO allies at odds on a number of issues.

Washington has recently been alarmed by Turkey’s refusal to accept Sweden and Finland’s green bid for NATO, while Ankara is frustrated that its request to buy F-16 fighter jets is increasingly tied to whether the two Nordic countries can join the alliance .

Nelson will visit 2-3 February Ankara, the capital of Turkey and the financial center of Istanbul. It warns businesses and banks to avoid transactions related to potential transfers of dual-use technology that could eventually be used by the Russian military, a spokesman said.

Dual-use items can have both commercial and military uses.

Washington and its allies have imposed several rounds of sanctions targeting Moscow since the invasion, which killed and injured thousands and reduced Ukrainian cities to rubble.

Turkey condemned the Russian invasion and sent armed drones to Ukraine. At the same time, it opposes Western sanctions against Russia and has close relations with both Moscow and Kyiv, its Black Sea neighbors.

It has also intensified trade and tourism with Russia. Some Turkish firms have bought or sought to buy Russian assets from Western partners who have pulled out due to sanctions, while others maintain large assets in the country.

But Ankara has pledged that international sanctions will not be circumvented in Turkey.

Washington is also concerned about the evasion of US sanctions against Iran.

The United States last month imposed sanctions on prominent Turkish businessman Sitki Ayan and his network of companies, accusing him of acting as a broker for oil sales and money laundering on behalf of Iran’s Revolutionary Guards.

While in the UAE, Nelson will note “poor compliance with sanctions” in the country, the spokesman said.

Washington has imposed a series of sanctions on companies based in the United Arab Emirates for evading Iran-related sanctions and on Thursday singled out a UAE-based aerospace firm for supporting the Russian mercenary company Wagner Group fighting in Ukraine.

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