The U.S. Sanctions Over 300 Individuals and Entities Linked to Russia in Several Countries

The U.S. government imposed extensive new sanctions against Russia ahead of the G7 summit, aiming to weaken the country in its war against Ukraine and increase the costs for foreign banks still dealing with Russia. On Wednesday, June 13, the U.S. State Department and Treasury announced that the new sanctions target over 300 individuals and entities in Russia, as well as in China, Turkey, and the United Arab Emirates. The main targets of these sanctions include the Moscow Stock Exchange and its subsidiaries, with the goal of complicating billions of dollars in money transfers, as well as three Russian companies involved in liquefied gas projects. Janet Yellen, U.S. Treasury Secretary, stated, "The goal of the sanctions announced today is to attack the remaining pathways for Russia to purchase materials and equipment in foreign markets, including the country’s reliance on sourcing sensitive goods from third countries." She added, "Our aim is to increase the risk for financial institutions that are connected to Russia's war economy, eliminate loopholes for sanctions evasion, and reduce Russia's access to foreign technology, equipment, software, and computer services." U.S. Secretary of State Antony Blinken also expressed concerns about the extent of Chinese exports to Russia and the supply of military needs to Russia by that country. In addition to imposing further sanctions, the U.S. Treasury has expanded its legal interpretation of "foundations of military industries" in Russia. Until now, foreign banks could face penalties for supporting Russia's military industries. However, under the new Washington decision, what is referred to as secondary sanctions can now encompass transactions with any individual or entity in Russia that has been sanctioned by the U.S. Accordingly, any foreign financial institution that deals with sanctioned individuals or Russian banks will be subject to secondary sanctions, and the list of sanctioned individuals and entities has increased from over a thousand to about four thousand five hundred. Another focus of the new sanctions targets the export of computer technologies and certain specific software to Russia. The new Washington sanctions also include Russia's money transfer network, and according to the U.S. Treasury, over 90 individuals and entities in countries such as China, South Africa, Turkey, and the UAE are targeted. The U.S. government claims that the transfer of goods and services by this network in foreign countries helps sustain Russia's war in Ukraine and evade Washington's sanctions. A senior U.S. official told reporters on Tuesday that actions aimed at limiting Russia's capabilities to continue the war in Ukraine have a "significant impact." He, who requested not to be named in the report, added, "Global exports to Russia have decreased by about $90 billion, and U.S. exports to that country have completely stopped, except for some items like vaccines." The Treasury added that by updating its information on five Russian financial institutions, it has added their addresses and aliases in foreign countries to the blacklist. The U.S. Foreign Trade Department also stated in a separate announcement that it has added eight addresses in Hong Kong to this list to target shell companies. According to U.S. officials, this blacklist includes addresses and information that account for about $100 million of exports of sensitive goods, including microchips, to Russia. They claim that most of these goods appear to be transferred to Russia by circumventing sanctions through China. These sanctions and new actions are announced ahead of the G7 leaders' summit. The White House has stated that during this summit, actions regarding the exploitation of frozen Russian assets for military assistance to Ukraine will be announced. Leaders of the G7 countries have expressed hope that the profits from about €300 billion of foreign currency from the Russian central bank, which is frozen in Europe, can be used to assist Ukraine. The proposed plan involves using the interest from these amounts as collateral and transferring it to Ukraine as part of a $50 billion loan. Joe Biden announced on June 13 that during his visit to France, he reached an agreement with the French President on using the profits from seized Russian assets to assist Ukraine.