US banks increasingly rely on IP address data to assess unusual activity when customers initiate payments from abroad. In practice, when a customer tries to use bank services from Russia, some American lenders may temporarily block or scrutinize the account. This approach has been observed by several market participants and reported in discussions about cross border finance and sanctions compliance.
Dmitry Doroshko, a senior M&A lawyer at ASB Consulting Group, notes that there have been multiple instances where clients faced restricted access after attempting transactions from Russia. He emphasizes that these restrictions have appeared over roughly the last year and a half, reflecting a broader pattern in risk management for international activity.
Maria Chumanova, managing partner at FTL Advisers, points out that banks typically reserve blocking powers for situations where illegal activity is suspected, such as money laundering or other illicit financial flows. She adds that among her firm’s clients there have not been reported cases of blocking by American banks based solely on geographic origin of a transaction, suggesting that internal risk models and case-specific signals drive decisions more than geography alone.
Pen & Paper’s senior partner Anton Namenov highlights the role of official guidelines in shaping bank practices. The Office of Foreign Assets Control instructs institutions to block payments initiated from sanctioned regions and to verify participants using available identifiers such as IP addresses. The same framework is applied, for example, to Cuba, Iran, North Korea, and Syria, as well as related zones that include certain disputed or restricted territories. Namenov notes that while Russia itself is not listed in those sanctioned regions, banks may consider internal assessments of customers interactions with the Russian market as part of their risk controls.
Experts also observe a broader liquidity implication for cross-border commerce. Instances of funds becoming stranded abroad often accompany delays in international payment agreements and the evolving landscape of sanctions regimes. In some cases, the balance of payments position can reflect negative movements when settlements take longer than expected or when counterparties face compliance delays. This dynamic has practical consequences for exporters, importers, and financial intermediaries who rely on timely and predictable settlement cycles.
In this environment, Canadian and U.S. financial institutions increasingly emphasize disciplined due diligence. Banks describe a layered approach that includes monitoring for unusual transaction patterns, cross-border payment routing analysis, and compliance checks aligned with sanctions lists and internal risk policies. For customers, the practical takeaway is to maintain clear documentation of the purpose and legitimacy of cross-border payments, anticipate potential reviews when operating from high-risk geographies, and stay informed about evolving regulatory expectations. Overall, institutions strive to balance security and access, aiming to minimize disruption while upholding legal obligations and financial integrity. The trend underscores the importance of transparent counterparty information and proactive risk management across North American banking networks.