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US Sanctions Russian National for Helping Ransomware Groups Launder Money

The US Treasury has sanctioned Ekaterina Zhdanova for laundering money on behalf of cybercriminals and Russian elites.

The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) on Friday announced sanctions against Ekaterina Zhdanova, a Russian national allegedly involved in money laundering for ransomware affiliates and Russian elites.

Zhdanova, the US Treasury says, uses virtual currency exchange transfers, fraudulent accounts and purchases, and connections to international money launderers to aid her clients in moving funds.

She also uses traditional businesses, such as a luxury watch company, to maintain access to the international financial system.

According to the US Treasury, in 2021, Zhdanova helped a Ryuk ransomware affiliate launder more than $2.3 million of suspected victim payments.

Believed to had been operated by Russian threat actors, Ryuk was a file-encrypting ransomware that emerged in 2018, and which was replaced with Conti.

The malware was used in attacks against thousands of victims worldwide, with the operation estimated to be worth more than $150 million in early 2021.

In April 2023, another Russian national, Denis Mihaqlovic Dubnikov, was sentenced in the US for laundering money for the Ryuk ransomware group between 2018 and August 2021.

Zhdanova, the US Treasury says, was heavily involved in helping Russian oligarchs transfer their wealth to Western Europe and other countries, providing them with access to a financial market that may otherwise be blocked due to prohibitions.

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“This type of illicit financial activity can be used to evade the multilateral U.S. and international sanctions that impose costs on Russia for its unprovoked war and deny the access of sanctioned Russian individuals and entities to the international financial system,” the department notes.

Zhdanova allegedly helped a Russian client transfer over $2.3 million through fraudulent investment accounts and real estate purchases, and transferred over $100 million to the United Arab Emirates on behalf of a Russian oligarch.

She also provided her Russian clients with United Arab Emirates tax residency, identification cards, and bank accounts, the US Treasury says. Cash and virtual currency payments were made to a Dubai bank account, and then transferred to foreign bank accounts.

The sanctions against Zhdanova mean that all her property and interests in the US are blocked and that US entities and individuals are prohibited from engaging in transactions with her.

Related: New York Couple Plead Guilty to Bitcoin Laundering

Related: US Sanctions Crypto ‘Laundering’ Service Tornado

Related: Russian Sentenced to French Prison for Bitcoin Laundering

Written By

Ionut Arghire is an international correspondent for SecurityWeek.

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