WASHINGTON — President Joe Biden’s administration imposed sweeping new economic sanctions Wednesday on Russia that include targeting Vladimir Putin’s two adult daughters in response to atrocities in Ukraine that the White House has called war crimes.
Maria Vorontsova and Katerina Tikhonova, daughters of Putin and his ex-wife, Lyudmila Shkrebneva Putina, face sanctions that will cut them off from the U.S. financial system and freeze any assets they may hold in the U.S.
The new round of sanctions, which also bans U.S. investment in Russia and hits Russia’s largest bank and financial institution, follows disturbing reports and images of civilian deaths in the Ukrainian town of Bucha near the capital of Kyiv. The moves continue Biden’s strategy of steadily ramping up sanctions as Russia’s war in Ukraine escalates.
“There’s nothing less happening than major war crimes,” Biden said, describing scenes of bodies left in the streets of Bucha including civilians executed with their hands tied behind their heads. “Responsible nations have to come together to hold these perpatrators accountable.”
The U.S. believes many of Putin’s assets are hidden with family members. The sanctions also target the wife and daughter of Russia’s foreign minister, Sergey Lavrov. Vorontsova leads state-funded research programs focused on genetics research that are personally overseen by Putin, and Tikhonova is a tech executive whose work supports the Russia defense industry.
An additional 21 members of the Russian Security Council and other Putin associates have also been sanctioned, adding to the 140 oligarchs and Kremlin officials – including Putin and Lavrov – already hit with sanctions since Russia invaded Ukraine. Dmitry Medvedev, former president and prime minister of Russia, and Prime Minister Mikhail Mishustin are among the newly sanctioned elites.
“Think about the incredible amounts of money these oligarchs have stolen,” Biden said, adding that they won’t be able to keep their “$100 million yachts” and luxury homes “while children in Ukraine are being killed, displaced from their homes every single day.”
The Biden administration is imposing sanctions on Russia’s largest financial institution, Sberbank, 42 of its subsidiaries and Russia’s largest private bank, Alfa Bank, and six of its subsidiaries. The White House called the moves “the most severe financial sanctions” the U.S. can take on these entities.
The actions will freeze any of Sberbank’s and Alfa Bank’s assets touching the U.S. financial system and prohibit anyone from the U.S. doing business with either. Sberbank holds nearly one-third of the overall Russian banking sector’s assets, and Alfa Bank is Russia’s fourth-largest financial institution overall.
“We’re locking down any account, any funds that those banks hold in the United States,” Biden said. “They won’t be able to touch any of their money.”
Biden is expected to sign an executive order that will prohibit new investment in Russia by U.S. citizens – regardless where they are living – in a bid to further isolate Russia from the global economy. More than 600 multinational companies have already removed business operations or investment out of Russia.
Biden said the ban will ensure “new money can’t come into Russia to replace what’s left.”
The Biden administration will also prohibit Russia from making debt payments with funds subject to U.S. jurisdiction, a move White House press secretary Jen Psaki said presents Putin with a difficult “choice” between draining Russia’s limited funds or default.
The sanctions were made in coordination with the Group of Seven nations and European Union allies, which are expected to take similar sanctions. The United Kingdom announced a full asset freeze against Sberbank and Credit Bank of Moscow, a ban on Russia investment and targeted investments on eight Russian oligarchs and Putin associates.
U.S. indicts Russian oligarch for sanction violations
The Justice Department took separate actions Wednesday aimed at a top Russian oligarch, unsealing an indictment against Konstantinos Malofeyev for alleged sanction violations. The Treasury Department previously identified Malofeyev as one of the main sources of financing for Russians promoting separatism in Crimea, and for providing material support for the so-called Donetsk People’s Republic.
“After being sanctioned by the United States, Malofeyev attempted to evade the sanctions by using co-conspirators to surreptitiously acquire and run media outlets across Europe,” Attorney General Merrick Garland said at a Justice briefing.
Garland announced the seizure of millions of dollars from an account at a U.S. financial institution, which the indictment alleges constitutes proceeds traceable to Malofeyev’s sanctions violations.
U.S. authorities also disrupted a global botnet controlled by the Russian military intelligence agency — commonly known as the GRU — aimed at infecting Ukrainian networks, according to the Justice Department.
FBI Director Christopher Wray said the cyber disruption disabled Russia’s intended actions against “thousands of devices” before they could be launched. Wray said the action “strikes a blow against Russian intelligence.”
In addition to the enforcement actions, Garland acknowledged for the first time that the Justice Department was assisting in the effort to examine possible war crimes in Ukraine. The attorney general said U.S. authorities had recently met with counterparts in Europe to develop a plan to gather evidence.
Garland said the Justice Department has “a long history” of helping hold accountable those who perpetuated war crimes and singled out the atrocities in Ukraine.
“We have seen the dead bodies of civilians, some with bound hands, scattered in the streets. We have seen the mass graves. We have seen the bombed hospital, theater, and residential apartment buildings.
“The world sees what is happening in Ukraine. The Justice Department sees what is happening in Ukraine,” he said.
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