Two very different examples of U.S. sanctions enforcement have recently highlighted the significant obligations on commercial actors to leave no stone unturned in their compliance oversight, when potentially doing business with Russian players. In the first, a U.S. private equity fund was caught out. In the second, the sanctioning of the Serbian oil company NIS in October 2025 has had far-reaching practical implications in the Western Balkans for consumers and NIS’s business partners.
On December 2, 2025, the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) announced a settlement with private equity firm IPI Partners, LLC (“IPI”). IPI will pay more than $11.4 million for apparent violations of the Ukraine/Russia-related sanctions regulations.
IPI set up a private equity fund to buy, build and operate data centers in 2016. It invited investors to commit capital for an ownership share in the fund.
Initially through intermediaries, a senior IPI executive was introduced to the Russian billionaire Suleiman Kerimov. After a number of meetings with Kerimov’s representatives and intermediaries, and after meeting Kerimov himself once, the IPI executive secured two investments. Totaling USD 50 million, these were technically made by Definition, a British Virgin Islands company ultimately owned by a Kerimov family trust.
In Spring 2018, Kerimov was designated as an official of the Russian government. As a result, any of his property or interests in property under U.S. jurisdiction became “blocked,” and U.S. persons were generally prohibited from dealing in such property.
After seeking outside legal advice regarding the implications of the designation, IPI kept Definition’s account unblocked on the basis that Kerimov’s stake fell below the 50% threshold. Consequently, the private equity firm continued to maintain Kerimov’s investments for the next four years. However, at the time it sought legal advice, IPI failed to disclose key details of its relationship with Kerimov, including the meetings it had with him and his representatives. In OFAC’s view, this made it difficult for IPI to claim it was unaware of the investor’s true identity.
OFAC determined that the alleged violations were non-egregious and not voluntarily self-disclosed. Under the Economic Sanctions Enforcement Guidelines, the breaches equated to a penalty of $14,356,690, which IPI settled for $11,485,352 on 2 December after OFAC weighed aggravating and mitigating factors.
OFAC’s enforcement notice concerning IPI stresses that capital market participants cannot hide behind complex legal structures when there is information to hand indicating a sanctioned person’s beneficial interest. OFAC explicitly warns that transactions involving entities with “opaque legal structures” could result in dealing with a blocked person or their property.
OFAC sanctions are far reaching and by their very nature, pose significant compliance challenges. In the Western Balkans, this has recently become very clear. OFAC’s sanctions against oil company NIS, majority owned by the Russian Gazprom Group, took full effect on October 9, 2025. This came after various licenses which had suspended their effect since January 2025 finally expired.
NIS is the majority owner of several other companies in Serbia and the region. Those companies are also subject to the sanctions, even though they are not specifically mentioned on OFAC’s sanctions list.
NIS owns no property in the United States, but there are still immediate local implications. In addition, there are serious consequences of the sanctions in NIS’s co-operation with suppliers and buyers. For example, the Croatian crude oil transportation company JANEF has stopped cooperating with NIS. Further, motorists can no longer pay for fuel at petrol stations using Visa, Mastercard and American Express credit cards. This is because those card companies process payments through US financial systems.
All entities which previously did business with NIS have found themselves in a position where they have to fully scrutinize whether they are now also impacted by the OFAC sanctions imposed on NIS. The Executive Orders targeting NIS make it possible to impose the same sanctions on persons who are providing assistance, support, goods or services to a sanctioned entity.
Authors: Luka Vidojković, Nina Raluca Bucataru
