Summary
- The A7 Network has been classified as a transnational criminal organization by OFAC, while FinCEN aims to prevent U.S. institutions from engaging with its front companies.
- The new regulations will affect convertible virtual currencies in addition to traditional fiat currencies.
- FinCEN reports that over 180 entities transferred at least $179.1 billion in A7's ruble-backed A7A5 token from February 2025 to June 2026.
The U.S. Treasury has taken action against the A7 Network, a Russian shadow banking entity allegedly leveraged by Iran and the Islamic Revolutionary Guard Corps to circumvent sanctions. This action includes a proposed rule that would sever its front companies from access to American financial systems, including cryptocurrency transactions.
The Office of Foreign Assets Control (OFAC) officially designated the A7 Network as a significant transnational criminal organization on Thursday, with operations traced to Russia, Kyrgyzstan, Nigeria, and Zimbabwe. Additionally, the Financial Crimes Enforcement Network (FinCEN) has suggested a ban on fund transfers involving what it terms the network's Sub-Agents, which are companies employed to disguise sanctioned payments as legitimate trade.
Today, Treasury took unprecedented action against the A7 Network, a shadow banking network with ties to Russia used by the Iranian regime to evade sanctions as part of Operation Economic Outcast.
Treasury’s @FinCENnews proposed a rule that would prohibit transmittals of funds…
— Treasury Department (@USTreasury) October 1, 2026
FinCEN's actions are grounded in section 9714 of the Combating Russian Money Laundering Act, which outlines six special measures. The agency opted for the sixth measure, which prohibits fund transmissions. The fifth measure, which would have restricted correspondent accounts, was deemed insufficient by blockchain intelligence firm TRM Labs, which noted that A7A5 transactions operate independently of correspondent banking, fundamental to the network's operations. This sixth measure encompasses both fiat and cryptocurrency, impacting around 348,000 institutions, including crypto exchanges.
Understanding the A7 Network and A7A5 Token
The A7A5 token, which is backed by the ruble, is issued by Old Vector, a company registered in Kyrgyzstan, and operates on both Tron and Ethereum networks, with deposits managed by Promsvyazbank, a state-owned bank in Russia specializing in defense. FinCEN describes a dual system where tokens circulate within Russia to reflect international payments while Sub-Agents facilitate corresponding fiat transactions in currencies such as dollars, yuan, dirhams, and euros, effectively keeping the two operations separate.
FinCEN identified that over 180 entities processed at least $179.1 billion in A7A5 transactions between February 2025 and June 2026, predominantly through sanctioned exchanges like Garantex and Grinex. The A7A5 token frequently serves as a non-freezable conduit to USDT and subsequently to fiat currencies. Following a reported hack at Grinex in April, there has been a shift towards unhosted wallets, which the agency interprets as a potential move away from sanctioned exchanges.
On the fiat side, A7 has established or acquired numerous Sub-Agents that maintain accounts at approximately 435 financial institutions across at least 83 nations, facilitating over $17 billion in transactions between January 2025 and June 2026. Account management is conducted from Moscow using custom VPNs to disguise the origin of the activities as being from Dubai, Hong Kong, or Bishkek.
One of the Sub-Agents has been linked to entities associated with Iran's clandestine fleet of tankers, reportedly receiving nearly $140 million from companies involved in sanction evasion. Another Sub-Agent transferred around $1.6 million to a firm connected to weapons procurement. Treasury also associates the A7 Network with Nobitex, an Iranian exchange previously designated in June, as well as with laundering activities related to North Korean exchange hacks.
The A7 Network was initiated in September 2024 by fugitive Moldovan oligarch Ilan Shor in collaboration with Promsvyazbank and claimed to process over 2,000 transactions daily by January. Its reported historical volume of 7.5 trillion rubles, roughly $91.5 billion, would represent about one-eighth of Russia’s foreign trade for the previous year. Parts of the network have previously been sanctioned by the EU, and the UK's National Crime Agency issued its own alert in August.
If you enable illicit financial activities for America's adversaries, "you will lose access to the U.S. financial system," warned Treasury Secretary Scott Bessent said. The public comment period for the proposed rule will close 30 days after its publication in the Federal Register.