Seiden Law Secures Release of GTS Funds Blocked for More Than Four Years Under Russia Sanctions

Seiden Law Secures Release of GTS Funds Blocked for More Than Four Years Under Russia Sanctions

The funds represented payment GTS received from Russia for goods it had shipped to the U.S. The money had been blocked by a U.S. bank for more than four years. GTS applied for a specific license to release the funds in May 2022. Nearly four years later, in April 2026, OFAC denied the application, concluding that the transfer involved an interest held by Alfa Bank, a Russian bank currently subject to full blocking sanctions.

Seiden Law, on behalf of GTS, filed suit against OFAC in the U.S. District Court for the District of Columbia, challenging the denial under the Administrative Procedure Act. The firm argued that Alfa Bank’s interest in the funds had already been extinguished once the transfer was completed and credited to the client’s U.S. bank on March 31, 2022, before it became subject to sanctions, and that OFAC therefore lacked a lawful basis to treat the funds as blocked property.

Following the filing, the Department of Justice and OFAC worked with Seiden Law to resolve the matter in the client’s favor. GTS’s bank has since received the license needed to release the funds, including all legally required interest.

The resolution underscores the importance of carefully examining the timing, mechanics, and legal effect of international payment transfers under blocking restrictions, particularly where a transfer is under compliance review before being credited to the beneficiary’s account. It also demonstrates that judicial review under the APA can provide a timely avenue for challenging agency action where the administrative process falls short or offers only a lengthy internal reconsideration mechanism.

The matter was led by أندرو أستونو, with support from Xintong Zhang and أميد كوشنر, and strategic guidance from Robert W. Seiden.