The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has announced a penalty of $4,677,552 against an individual investor for violating sanctions related to Russian property and failing to comply with an OFAC subpoena. This is the statutory maximum penalty and is intended to emphasize the responsibility of all U.S. persons, including those in real estate, to follow OFAC sanctions and orders.
According to the Treasury Department, between April 2023 and March 2024, the individual—identified as “U.S. Person-1”—acted through King Holdings LLC, a real estate investment company based in Atlanta, Georgia. The person mortgaged, renovated, and sold residential property owned by someone sanctioned under OFAC’s Russia-related regulations. The sale was concealed from OFAC and also violated a cease-and-desist order issued by the agency.
In March 2022, a family member of a Russian oligarch was added to OFAC’s sanctions list under Executive Order 14024. This individual owned residential property in Atlanta directly under their name. At that point, any dealings with this property became prohibited without authorization from OFAC.
To make these restrictions clear, authorities in Fulton County, Georgia recorded documentation at OFAC's request and made it public. Despite this notice, the property entered foreclosure and was bought at auction by King Holdings in January 2023. The company began plans to renovate and sell it without realizing its blocked status at first.
OFAC discovered the situation in April 2023 and informed U.S. Person-1 that dealings with the property were still not allowed unless authorized through a license application—a step which was not taken. Instead, renovations continued and the property was eventually sold without notifying or seeking approval from OFAC.
While the sale was pending, OFAC issued both a cease-and-desist order to King Holdings and a subpoena requesting information about their actions related to the property. In response to the subpoena, U.S. Person-1 certified that their response was complete but did not mention that they were proceeding with selling the property—a transaction completed soon after receiving these orders.
“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.”
Further details can be found in the Enforcement Release.
