Former Russian Bank Board Member Sues for Removal From US Sanctions List

A former board member of a Russian state-owned bank asked a federal court to order the U.S. to remove her from a U.S. sanctions list, saying there is “no factual basis” that supports her listing. In a complaint recently filed with the U.S. District Court for the District of Columbia, Elena Titova, a dual Russian and U.K. citizen, said she resigned from her position eight days after Russia’s invasion of Ukraine last year but was still added to the Treasury Department’s Specially Designated Nationals List even though she hasn’t been designated by any “other nation in the world.”

She argued that her designation will “have absolutely no effect on the national security crisis” created by Russia’s invasion of Ukraine, and that she “has no ties to or sway with the Russian government” and is “neither a U.S. adversary nor a national security or foreign policy risk.” Titova also said her designation violated the Office of Foreign Asset Control’s policy of imposing sanctions “not to punish, but to bring about a positive change in behavior.”

If Titova can’t be removed from the SDN List based on her resignation from PJSC Bank Otkritie Financial Corporation, which was sanctioned by OFAC immediately after the invasion, “then there is effectively nothing she can do to end her status as a sanctioned individual because she has already terminated the sole basis for her designation,” her June complaint said. “Moreover, keeping Plaintiff and others similarly situated on the SDN List sends a message that the U.S. assigns no value to course correction.”

The complaint said Titova was added to the SDN List 46 days after she resigned as an “independent board member” of the bank. Since then, OFAC has “failed to adjudicate her delisting application,” saying in the time since Titova applied to be removed from the SDN List, OFAC has removed sanctions from Anatoly Karachinskiy, a “fellow former Bank Otkritie board member.” The agency removed Karachinskiy from the SDN List in May.

“Under the binding precedents of this Court, Defendants are required to treat similarly situated parties similarly pursuant to the same administrative process,” the complaint said. “Defendants must then adjudicate Plaintiff’s matter in a similar manner as those other petitioners or, at a minimum, provide some explanation as to why Plaintiff has been treated differently.”

OFAC has given her “no substantive response” to “numerous requests for timely adjudication” despite her “full cooperation,” the complaint added, “including prompt responses to Defendants’ requests for information.” Instead, the agency has issued her “questionnaire after questionnaire, increasingly asking Plaintiff for information that is both irrelevant and unnecessary in a transparent attempt to either delay making any decision on her application or fish for information that may warrant designation on other grounds.”

The complaint said Titova has been waiting for more than a year for an adjudication despite the fact that it has “conclusive evidence” she resigned from the bank, which was the “sole basis” for her designation. “The extraordinary delay in adjudicating Plaintiff’s petition for reconsideration stands in stark contrast to the simplicity of the question before them.”

Because of her designation on the SDN List, Titova hasn’t been able to find a job at “any unsanctioned institution or company, has experienced severe difficulty in paying for her living expenses, is prevented from participating in any meaningful economic activity even in her home country, and her reputation has been stained,” the complaint said. It adds Titova has a master's degree in management from Northwestern University, and previously worked at Goldman Sachs, Morgan Stanley and UBS, where she worked on “enhancing transparency and adopting international best practices with respect to the corporate sector and capital markets” in Russia.

The complaint, filed against Treasury and the State Department, asks the court to “declare and/or order” her “rescission” from the SDN List. It also asks the court to order the U.S. government to “issue a written decision” on her pending delisting petition and provide a “legitimate reason” why her petition has been treated differently than those of “similarly situated petitioners.”