JPMorgan, Citi Sued for Frozen Payments to Sanctioned China Firm

JPMorgan Chase & Co. and Citigroup Inc. were sued by a Chinese energy company for freezing payments meant for a firm that later came under US sanctions, a rare legal dispute that underscores the intensifying regulatory crossfire between Washington and Beijing.

HY Energy Group Co. filed suit against Citibank in a Shanghai court in February, alleging the bank failed to complete a $27 million transfer initiated in July 2023. The intended recipient, China Oil and Petroleum Co., reported it never received the funds. In May 2024, Citibank informed HY Energy that the capital had been “released” to the US Treasury Department’s Office of Foreign Assets Control.