How we helped the client to start doing business again

In February 2023 banks sent notifications to one of our clients. It is OOO LEDLIGHT, that is engaged in construction. That notification said that the Central Bank of the Russian Federation attributed to a group of high risk of making suspicious transactions, according to the clause 5 of Art. 7.7. Federal Law 115-FZ from August 7, 2001 “On Combating Legalization (Laundering) of Proceeds from Crime and Financing of Terrorism”. The bank assigns appropriate colors to such groups, and the red color is assigned to this one. 

According to this Federal Law, banks are required to suspend transactions involving funds or other property. But there is an exception for the transactions involving crediting funds received to the account of an individual or legal entity, for five working days from the day when the client's order must be carried out, if at least one of the parties is:

• a legal entity owned or controlled directly or indirectly by an organization or individual in respect of which measures to freeze money or other property have been taken, or an individual or legal entity acting on behalf of or at the direction of such organizations or individuals;
• an individual carrying out transactions with funds or other property aimed at receiving and spending wages in an amount not exceeding 10,000 rubles. 

Furthermore, by a court decision on the basis of an application from the authorized body, transactions on bank accounts or other transactions with funds of organizations or persons shall be suspended until such decision is reversed, if there is information that according to 115-FZ they are involved in extremist activities. 

The Bank of Russia has detected suspicious transactions involving our client, but the specific details were not provided in the notifications regarding the suspension of transactions. As a result, all client accounts held in various banks have been frozen, and their business operations have come to a halt. According to Law 115-FZ, when an organization is attributed to group of high risk of making suspicious transactions, certain measures are implemented. 

• Several transactions are not performed, such as withdrawing funds from a bank account, decreasing the balance of electronic funds, transferring funds through the fast payment service of the Bank of Russia payment system, or conducting cash withdrawal operations.
• When terminating a bank account agreement, the remaining funds in the account are not issued, and it is not possible to transfer the balance to another account belonging to the client or to a third-party account.
• The ability to use electronic payment methods and remote banking systems is also terminated. 

Our team of lawyers submitted a statement to the Interdepartmental Commission of the Central Bank, providing a detailed explanation there are not any suspicious transactions. We included supporting documents that justified our client's normal business activities and demonstrated positive financial results.
As a result, the Interdepartmental Commission of the Central Bank of the Russian Federation reviewed the application and supporting documents and decided to remove our client from the high-risk group for suspicious transactions. Within a few days, the client's accounts were unfrozen by the banks handling their transactions, allowing them to resume their business activities and manage their account balances.