Russia Threatens Retaliation after JP Morgan Blocks Payment

Russia has accused US bank JP Morgan of ‘illegally’ blocking a money transfer from one of its embassies to an insurance agency and threatened retaliatory measures against the US embassy and consulate in Russia.

It said that blocking the payment was unacceptable and had been done “under the pretext of anti-Russian sanctions”.

“Washington should understand any hostile action against a Russian diplomatic mission not only constitutes a flagrant violation of international law but is rife with consequences that will inevitably effect the work of the embassy and general consulate of the United States in Russia,” read a statement by the Russian Foreign Ministry on its website. “In that sense, JPMorgan Chase has done the US administration a disservice.

“If the American financial structure is expected to earn points in the eyes of the White House in this way, then that decidedly goes too far.”

The payment came from Russia’s embassy in Kazakhstan to Russian insurance agency Sogaz, which is partly owned by Abros, according to the Sogaz website. Abros is a subsidiary of Bank Rossiya, according to Russian media reports, which faces US sanctions.

JP Morgan is one of several Western banks operating in Russia. Others include Goldman Sachs, Bank of America, Citigroup and Morgan Stanley.

The bank responded: “As with all US financial institutions that operate globally, we are subject to specific regulatory requirements. We will continue to seek guidance from the US government on implementing their recent sanctions.”

Uncertainty over the scope of US sanctions has already caused Visa and MasterCard briefly stop serving clients at Russia’s SMP bank as some of the company’s shareholders were targeted. Ultimately, the two US card companies resumed their service.

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