U.S. Treasury Fines Property Management Firm $7.1 Million for Violating Sanctions: The Case of Gracetown Inc.
The U.S. Treasury Department has fined a New York-based property management firm $7.1 million for violating sanctions by managing luxury real estate properties for Russian oligarch Oleg Deripaska, who has close ties to Russian President Vladimir Putin. Gracetown Inc. received payments on behalf of a company owned by Deripaska despite being notified that dealings with him were prohibited. The Justice Department filings from 2022 link Gracetown Inc. to U.K. businessman Graham Bonham-Carter, who was arrested for conspiracy to violate U.S. sanctions and wire fraud related to funding Deripaska’s U.S. properties and expatriating his artwork to New York.
Deripaska has been under economic sanctions since 2018 for acting on behalf of a senior Russian official and operating in the Russian energy sector. All his assets subject to U.S. jurisdiction were blocked, and U.S. individuals and firms are prohibited from dealing with Deripaska, his properties, and his interests. In 2022, Deripaska and three associates were criminally charged in New York for conspiring to violate U.S. sanctions and ensuring his child was born in the United States.
The Treasury Department's enforcement action against Gracetown underscores the importance of following OFAC-issued guidance and the severe consequences of failing to do so. John K. Hurley, Treasury’s undersecretary for terrorism and financial intelligence, emphasized that they will continue to investigate and hold accountable those who enable sanctioned actors. Gracetown, established in 2006, manages luxury real estate properties in New York and Washington, D.C., acquired by Deripaska through various legal entities.