Moldovan and Kyrgyz banks suspend operations with Unistream

By Nathan Meyer, Compliance Consultant – Eurasia Business News, July 25, 2023

Several major banks in Moldova have suspended operations with the Unistream money transfer system indefinitely. The banks are Moldinkombank, Agroindbank and Victoriabank. On July 20, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) added Unistream to its sanctions list.

Unistream Commercial Bank JSC is a money transfer institution based in Moscow.

The Unistream system, which allows the transfer of money internationally, continues to work, however, thanks to other financial institutions. Unistream is supported by the Moldovan bank Finkombank.

Unistream was included in OFAC’s register along with Tinkoff Bank, Solidarnost Bank, Loko Bank and St. Petersburg Social Commercial Bank. On 24 July, it was reported that some credit institutions in Armenia, Kyrgyzstan, Uzbekistan and Kazakhstan had announced the suspension of their operations with the Russian payment system of these banks.

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In particular, the system ceased to function at Bank of Asia, established in Kyrgyzstan on 21 July, Bank Halk of Uzbekistan, Bank Ipoteka and Bank of Turon. In addition, transfers via Unistream have been suspended to Armenian Inecobank and Georgian bank TBC, Liberty Bank and Bank of Georgia.

To date, six banks in Kyrgyzstan have suspended their collaboration with the Russian money transfer system Unistream, according to statements on their websites.

Kompanion Bank, Finca Bank and RSK Bank have indicated on their official websites that transactions via the Unistream system are not available. Kompanion Bank said this happened because of OFAC’s sanctions restrictions. Finca Bank said it had suspended its operations in dollars and euros, while two other banks only used dollars.

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One of the solutions used by people residing in Russia and wishing to transfer funds abroad is the transfer of yuan-denominated funds from Russian bank accounts to Chinese banks. The Chinese bank account is then used as an intermediary to transfer the funds to Europe or America. Buying and reselling gold and silver is another solution used since March 2022.

On July 20, the day businessman Oleg Tinkov was removed from the British sanctions list, the Tinkoff Bank, founded by him, of which he ceased to be a shareholder in 2022, fell under the strictest restrictions – the US OFAC sanctions. This new round of sanctions also affected other financial institutions and became the most visible since February 2023, when many Russian banks that had previously avoided such restrictions were included in the U.S. sanctions list and the U.K. and European Union sanctions lists.

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