Treasury Sanctions Russia with Sweeping New Sanctions Authority

This article outlines the imposition of comprehensive sanctions against Russia under a new Executive Order (E.O.) issued on April 15, 2021. These measures respond to various harmful activities attributed to the Russian government, which threaten the national security and foreign policy of the United States. The sanctioned activities include interference in democratic processes, engaging in malicious cyber operations, fostering corruption to influence foreign governments, targeting dissidents and journalists, and other acts undermining security in key regions.

New Prohibitions on Russian Sovereign Debt: U.S. financial institutions are prohibited from participating in the primary market for bonds issued by significant Russian entities after June 14, 2021, and from lending funds to these entities. Targeted Sanctions on Technology Sector: Specific Russian technology companies supporting the Russian Intelligence Services are designated for their role in enhancing Russia’s offensive cyber capabilities. These companies include ERA Technopolis, Pasit, SVA, Neobit, AST, and Positive Technologies, which are involved in various capacities such as developing military technologies, supporting cyber operations, and hosting events that potentially recruit for Russian intelligence efforts. Broad Sanction Implications: The sanctions block all property and interests in property of the designated entities within the U.S. or under U.S. control. The order also generally prohibits transactions involving these entities by U.S. persons or within the United States.

These sanctions reflect the U.S. government’s strategic use of economic measures to address and deter Russia’s destabilizing and malicious activities, particularly in the cyber domain. The measures aim to limit Russia’s ability to finance its operations and target its technological capacity to conduct cyber warfare and espionage.