US President Joe Biden, along with Treasury Secretary Janet Yellen (L) and Secretary of Defense Lloyd Austin (R), speak during a meeting with his cabinet at the White House in Washington, DC, on March 3, 2022.
The US Treasury Department announced on Wednesday that it has expanded its wide range of sanctions to include businesses and individuals helping Russia avoid the impact of economic sanctions on Moscow.
Treasury officials say the department is now targeting Russia’s commercial bank Transkapitalbank, as well as a network of more than 40 people, including oligarch Konstantin Malofeyev, whom he believes is helping the Kremlin eliminate a wave of economic punishments.
The Biden administration also said it was cracking down on companies operating in Russia’s virtual currency mining industry, including Bitriver, which is helping the country monetize its exports and other natural resources.
“The Treasury can and will target those who escape, try to evade or help evade US sanctions against Russia, as they help support Putin’s brutal election war,” said Brian Nelson, Undersecretary for Terrorism and Financial Intelligence. , in a press release. .
“The United States will work to ensure that the sanctions we have imposed, in close coordination with our international partners, degrade the Kremlin’s ability to project power and finance its invasion,” he added.
As a private Russian bank, Transkapitalbank has offered to help Moscow avoid detection and restrictions of sanctions through its own internet-based banking system known as TKB Business, the Treasury Department said in a statement announcing the sanctions.
This system, said Treasury officials, is an alternative communication channel to the Society for Worldwide Interbank Financial Telecommunication, or SWIFT. It is also designed to process US dollar payments for sanctioned customers.
Earlier this year, the United States, the European Union, Canada and the United Kingdom cut off several Russian banks from the SWIFT financial network, one of Washington’s strongest moves to date to isolate Russia from the global market and paralyze its economy.
This move has effectively prevented Russia from communicating securely with banks beyond its borders.
The treasury also said it was stepping up its efforts to cancel a global network of “sanctions evasion and malicious influence” led by Russian oligarch Malofeyev.
Malofeyev was first targeted by the United States in 2014 for his role in activities that “threaten the peace, security, stability, sovereignty or territorial integrity of Ukraine.” At the time, the Office for the Control of Foreign Assets noted that Malofeyev was one of the main sources of funding for Russians promoting separatism in Crimea.
“In recent years, the Treasury said on Wednesday,” Malofeev, secretly or through intermediaries, has supported pro-Russian activities that undermine democracy, interfere with elections and degrade security and stability in a number of countries. ”
The announcement is also the Biden administration’s first attempt to attack Russia’s virtual currency mining industry.
Among the companies targeted by US sanctions is Bitriver, a company founded in 2017 that operates its hydroelectric mining facilities.
The Office for the Control of Foreign Assets named 10 Russian subsidiaries of Bitriver in its latest wave of sanctions.
“Russia has a comparative advantage in cryptographic mining due to energy resources and a cold climate,” Treasury officials said on Wednesday. “However, mining companies rely on imported computer equipment and fiat payments, which makes them vulnerable to sanctions.”
“The United States is committed to ensuring that no asset, no matter how complex, becomes a mechanism for the Putin regime to offset the impact of sanctions,” they added.
– CNK’s MacKenzie Sigalos contributed to this report.