ADVERTISEMENT

The United States will announce a new package of sanctions against Russia on Wednesday

ADVERTISEMENT

ADVERTISEMENT

The official said the comprehensive package “will impose significant costs on Russia and push it down the path of economic, financial and technological isolation.”

The new sanctions package will ban all new investments in Russia, increase sanctions on financial institutions and state-owned companies in Russia, and penalize Russian government officials and their family members.

A Western official familiar with the plans said the United States could impose sanctions on Russian President Vladimir Putin’s adult sons – who has admitted two daughters – as early as Wednesday. That official said the Biden administration was also looking to expand sanctions on Sberbank, Russia’s largest financial institution, and Alpha Bank, another large bank.

The new sanctions package would mark the latest escalation in efforts by the United States and its allies to impose costs on Russia for its invasion and, over time, cutting off vital economic sectors the country uses to wage the ongoing war. Officials said they are also following up on new revelations about more atrocities committed by Russian forces in northern Ukraine, as images of the Bucha atrocities accelerate ongoing discussions between the United States and its European allies to increase the economic costs.

“These actions will weaken the main instruments of Russian state power, will impose severe and immediate economic damage on Russia, and hold to account the Russian kleptocracy system that finances and supports Putin’s war,” the administration official said. “These actions will be taken in full swing with our allies and partners, demonstrating our determination and unity in imposing unprecedented costs on Russia for its war against Ukraine,” he added.

The official added: “We have already concluded that Russia committed war crimes in Ukraine, and the information from Bosha appears to show more evidence of war crimes. As the President said, we will work with the world to ensure that there is full accountability for these crimes. These crimes. Sanctions Tools – We are working extensively with our European allies to impose more sanctions.”

The expected sanctions come after the US Treasury announced that it would no longer allow Russia to pay its debts using dollars stored in US banks. While Washington had imposed sanctions on the Russian Central Bank to freeze its foreign currency in US banks, the Treasury had previously allowed Russia to use these reserves to pay off its debts.

It’s a move officials say will dramatically increase the risk of default and undermine the central bank’s urgent efforts to stem the economic bleeding that immediately halted the Russian economy in the wake of the Western response to the invasion.

Since the start of Russia’s invasion of Ukraine at the end of February, the United States and its allies have punished hundreds of Russian elites and lawmakers, restricted the country’s access to Western technology critical to the defense and technology sectors, and froze and cut nearly half of Russia’s foreign reserves. From selected Russian banks from the SWIFT banking network, among other steps. The United States has also banned the import of oil, natural gas and other Russian energy products.

While the severity and speed of Western sanctions against Russia are unprecedented, there are still major exceptions as US officials continue to monitor US and European supply chains and try to limit the impact of sanctions on Western economies grappling with record inflation levels. .

CNN reported late last week that Russia faces a deep recession and soaring inflation as sanctions push the country toward an increasingly closed economy, a shift US officials believe the Kremlin will struggle to achieve because it has long relied on selling raw materials to China. Purchase of advanced equipment and consumer goods.

Sanctions ‘take time’ to ‘undermine’ the Russian economy

While the United States and its allies have imposed the most comprehensive sanctions regime targeting a country the size of Russia in history, officials acknowledge it has done little to alter Putin’s calculus.

The threat of sanctions did not deter the invasion itself, and the buildup of economic sanctions has not brought Russia closer to a negotiated withdrawal or settlement since then.

However, the administration’s sanctions policy, spearheaded by a group of veterans involved in response to Russia’s latest incursion into Ukraine in 2014, has been calibrated to isolate vital components of the Russian economy over time and, perhaps most importantly, into a unified system. A multilateral method.

The overall intent to maintain unity with the more than 30 countries across four continents that have joined the sanctions has limited its access to the main driver of the Russian economy: energy.

EU members’ dependence on Russian oil and gas has limited the scope of sanctions targeting the energy sector, even as the United States moved on a unilateral basis to ban Russian oil imports. It has also created pressures to address rising energy prices around the world, potentially creating an internal tension that would undermine what has been a united front up to this point.

However, the brazen nature of the Russian offensive has significantly diverted the desire of some European leaders to sign off on expanded economic sanctions. The European Union is now planning to ban imports of Russian coal, officials said, and despite some continued resistance, a move to extend the ban to oil and gas continued to gain traction.

However, for all the focus on the immediate impact of the sanctions, officials note that key parts of their efforts are having the most impact as the conflict continues. Export controls targeting vital economic sectors are designed to cut off access to technology needed for the Russian industrial base to continue production in the areas of defence, aerospace and biotechnology.

Sanctions targeting the central bank will, over time, systematically undo years of Russian efforts to isolate its economy with foreign currency reserves that are now frozen, or must be exploited urgently to avoid an imminent default.

Expanding individual sanctions beyond key Russian officials and financiers to family members also aims to cut key avenues for wealth protection from new sanctions.

“It’s going to take some time to grind the elements of Russian power inside the Russian economy, hit their industrial base hard, hit the revenue streams that have supported this war and have supported … Russia’s kleptocracy,” Biden’s national security adviser, Jake Sullivan, told reporters Monday. “But there is no better time than now to work in this area where the costs end up and Russia’s options end up being refined.”

US imposes sanctions on Russia’s “most prominent” dark web market

The US Treasury on Tuesday imposed sanctions on what it called the “highlight” of Russia’s dark web market, a place where cybercriminals sell hacking tools and where millions of dollars in ransomware payments are traded.

The sanctions coincided with a German police move to shut down Hydra’s computer servers, as the dark web market is known, and seize $25 million in cryptocurrency.

Also on Tuesday, the Justice Department announced criminal charges against Dmitriy Olegovich Pavlov, a 30-year-old Russian national, for drug conspiracy and money laundering in connection with his alleged role in managing Hydra’s computer servers.

Since its appearance in 2015, the dark Hydra web marketplace — an Internet-based network that can be accessed through specialized software — has been a haven for illicit trade, according to researchers and US officials. More than $5 billion in bitcoin transactions have been made on Hydra, according to Elliptic, a company that tracks cryptocurrency.

That includes about $8 million in ransom payments made to hackers who spread three notable strains of ransomware in attacks on US companies.

“The global threat of cybercrime and ransomware emerging in Russia and the ability of criminal leaders to operate there with impunity is a matter of grave concern to the United States,” Treasury Secretary Janet Yellen said in a statement.

After a series of ransomware attacks on critical infrastructure in the United States last year, the Biden administration sought to stifle the sources of funding for cybercriminal gangs. In September, the Treasury Department imposed sanctions on Suex, a cryptocurrency exchange that US officials have accused of dealing with hackers behind eight types of ransomware.

This story was updated with additional reports on Tuesday.

CNN’s Kevin Liptak contributed to this report.

ADVERTISEMENT

Leave a Comment

ADVERTISEMENT
ADVERTISEMENT