The US Treasury's Financial Crimes Enforcement Network sanctioned A7 Network and proposed banning sub-agent payment processing after finding A7's sub-agents processed over $17 billion in dollar-denominated transactions between January 2025 and June 2026 in violation of AML requirements. The action targets layered correspondent-style payment networks that obscure transaction origins.
For Armada's crypto repo desk, this enforcement action is a counterparty risk signal. Hedge funds, family offices, and market makers that route dollar settlements through non-transparent payment intermediaries could carry elevated regulatory exposure. Armada's onboarding and KYC processes should be reviewed to ensure they capture sub-agent payment network relationships, particularly for counterparties with offshore or emerging-market operational footprints.