OFAC settles with FTI Consulting for $1.05 million over indirect SSI debt dealings with VTB Bank
Professional services and consulting firms routing engagements for SSI-listed entities through law firm intermediaries must treat the arrangement as indirect prohibited debt — the intermediary structure does not create compliance insulation.
Change
OFAC settled with FTI Consulting for $1,050,000 on 1 June 2026 for indirectly dealing in prohibited debt of VTB Bank (SSI Directive 1) by issuing invoices through a law firm intermediary that VTB was ultimately responsible for paying — OFAC confirmed that routing transactions through a third party does not make permissible what is otherwise prohibited.
Why it matters
The enforcement release establishes three operative compliance signals for professional services firms: (1) indirect dealings through intermediaries — including law firms — are subject to the same prohibitions as direct dealings with SSI-listed entities; (2) each dealing with a less-than-fully-blocked entity must be assessed individually against all applicable OFAC restrictions; (3) a sanctioned counterparty's failure to make timely payment itself creates sanctions risk — overdue invoices extend prohibited debt beyond the 14-day tenor limit under Directive 1. OFAC explicitly penalised FTI for continuing to work and issue new invoices while prior invoices remained unpaid.
Implications
- — Professional services firms and consultancies engaged by law firms to support SSI-listed or otherwise sanctioned clients must treat the engagement as a direct dealing for OFAC purposes — the law firm intermediary structure does not insulate the US person from Directive 1 or other sectoral sanctions debt restrictions.
- — Compliance teams at professional services firms must implement invoice ageing monitoring for any engagement where payment flows through an intermediary to a sanctioned counterparty — invoices overdue beyond the applicable debt tenor limit create prohibited debt exposure regardless of the payment structure.
- — Sanctions compliance officers must assess the economic and practical reality of each engagement, not just the formal contractual structure — where the sanctioned entity is the ultimate obligor or beneficiary, the dealing is covered by OFAC prohibitions regardless of how payment arrangements are documented.
Who is affected
- — Professional services firms, consultancies, and advisory firms engaged by law firms to support sanctioned or SSI-listed clients
- — Sanctions compliance officers at US persons providing services in transactions with intermediary payment structures
- — Law firms engaging third-party experts on behalf of SSI-listed or sanctioned clients