Garantex OFAC sanctions designation

Garantex, a Russian crypto exchange, was designated by OFAC in April 2022 for facilitating illicit transactions and ransomware proceeds.

TL;DR

TL;DR: OFAC designated the Russian exchange Garantex in April 2022, alongside Hydra Market, for facilitating illicit activity. Any transaction with Garantex is a strict-liability sanctions violation.

What happened

Garantex operated as a cryptocurrency exchange that OFAC found was processing transactions tied to illicit activity, including ransomware proceeds. OFAC designated Garantex in April 2022 in the same action that designated Hydra Market, treating the exchange itself as a sanctions target rather than a firm that paid a civil penalty.

The violation cited

Once an exchange is designated, it becomes a blocked party on the SDN List, and any US person who transacts with it, even indirectly, is exposed under strict liability. Intent is not required, and civil penalties start at $356,000 per violation. The 50 Percent Rule extends the block to entities 50% or more owned by a blocked person, so a payment routed through a front or a shell with Garantex ownership still violates sanctions.

The lesson

Exchanges that service illicit markets become designated themselves, and the designation follows the address, not the brand. A screening check that inspects a counterparty wallet against 947 OFAC-listed crypto wallets in one call under 100 ms returns BLOCK for a designated exchange before funds move, while clean counterparties return ALLOW. Payment rails such as x402, AP2, and Coinbase AgentKit move money but do not screen, so the check must precede the transfer.