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US Imposes Sanctions on Some of Russia’s Biggest Gold Miners

Published 19/05/2023, 18:24
Updated 19/05/2023, 18:24
© Bloomberg. A worker pours molten gold into a mold during the casting of gold ingots at the JSC Krastsvetmet non-ferrous metals plant in Krasnoyarsk, Russia, on Monday, July 12, 2021. Gold headed for its second decline in three sessions as strength in the dollar and equities diminished demand for the metal as an alternative asset.

(Bloomberg) -- The US has sanctioned some of Russia’s biggest gold miners, as it imposes fresh penalties on the country’s metals and mining sector.

Polyus PJSC, the country’s No. 1 gold miner, and Polymetal JSC, the Russian unit of Polymetal International Plc, were targeted, according to a statement Friday from the US Department of the Treasury’s Office of Foreign Assets Control. Share and debt holders of Polyus, along with the company’s counterparties, have until Aug. 17 to sell their assets and wind down their operations.

Gold from Russia, the world’s second-biggest producer, became taboo after the invasion of Ukraine, and imports were blocked by Group of Seven nations and European Union last summer. That forced Russian miners to re-direct supplies to places like the United Arab Emirates, Hong Kong and Turkey, where there are no restrictions. Sanctions against the companies are likely to deter some of customers in those countries.

The OFAC sanctions were also extended to Polyus’s major units, Chief Executive Officer Alexei Vostokov, some other top managers and former CEO Pavel Grachev.

READ: Russian Gold Is in Hands of Obscure Firms as JPMorgan (NYSE:JPM), HSBC Exit

Earlier on Friday, the UK and Australia became the first countries to sanction Polyus.

Polyus was long controlled by the family of sanctioned billionaire Suleiman Kerimov. Just months after Russia invaded Ukraine, Said Kerimov — son of the billionaire and also under penalties now — gave his 46.35% stake in Polyus to the Fund for Support of Islamic Foundations in Russia. 

Separately, the OFAC also sanctioned Sergey Malyshev, chief financial officer of Russia’s biggest miner MMC Norilsk Nickel PJSC (OTC:NILSY). The miner itself is free of penalties, even after its billionaire CEO Vladimir Potanin was sanctioned in December.

©2023 Bloomberg L.P.

© Bloomberg. A worker pours molten gold into a mold during the casting of gold ingots at the JSC Krastsvetmet non-ferrous metals plant in Krasnoyarsk, Russia, on Monday, July 12, 2021. Gold headed for its second decline in three sessions as strength in the dollar and equities diminished demand for the metal as an alternative asset.

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