U.S. Government Actions on Russia-Ukraine Crisis

As the Russian invasion of Ukraine intensifies, the US, EU, and UK have been working to introduce further sanctions and other restrictions to impose severe costs on Russia’s economy. Included in this document is a recap of actions taken by the U.S. Government, entities and individuals impacted, and additional recent context from BGR’s team of experts.

2/25/22

Press Secretary Jen Psaki confirmed Friday evening that, following the EU’s overnight action imposing sanctions on Putin and Russian Foreign Minister Lavrov, the U.S. would similarly be imposing sanctions on Putin, Lavrov, and others within the Russian national security team. A somewhat symbolic move, the U.S. typically avoids imposing sanctions on leaders of foreign countries the U.S. maintains diplomatic relations with.

2/24/22

The White House announced on Thursday, 2/24, additional sanctions and export controls to impose further costs on Russia, building off announcements from throughout the week. At a press conference, President Biden stated the U.S. will be imposing additional sanctions and new limitations on exports. Biden emphasized the package was designed to impose both immediate and long-term costs on Russia. He stated that the U.S. would be sanctioning an additional five large Russian banks, including VTB, and that the U.S. will continue rolling out sanctions on Russian elites and their families today and in the days ahead. Biden stated he would impose export restrictions to severely limit Russia’s ability to build a 21st century economy, cutting off half of Russia’s high-tech imports.

Biden stated there are more options on the table, noting that today’s sanction package is designed to allow energy payments to continue. Though the U.S. has emphasized cutting access to SWIFT remains an option and Ukraine and the UK have vocally advocated for the measure, there are severe hesitations in Europe, particularly among Germany, Italy, Hungary and Cyprus. Biden stated that while cutting Russia off from SWIFT does remain on the table, he recognized that is not a direction Europe wants to go in at this time, and argued the sanctions imposed on Russia’s financial institutions would impose a greater cost than removing Russia from SWIFT.

U.S. export controls include Russia-wide denial of exports of sensitive technology, primarily targeting the Russian defense, aviation, and maritime sectors to cut off Russia’s access to cutting-edge technology. In addition to sweeping restrictions on the Russian-defense sector, the United States government will impose Russia-wide restrictions on sensitive U.S. technologies produced in foreign countries using U.S.-origin software, technology, or equipment. This includes Russia-wide restrictions on semiconductors, telecommunication, encryption security, lasers, sensors, navigation, avionics and maritime technologies.

2/23/22

Following Germany’s announcement on 2/22 that it would be indefinitely suspending the certification of the Nord Stream 2 pipeline, President Biden announced on 2/23 that the U.S. would impose sanctions on Nord Stream 2 AG, and its CEO. Biden’s imposition of sanctions on NS2 clears a significant roadblock in bipartisan negotiations on additional deterrence measures – and will ease the confirmation process of many of Biden’s foreign policy and national security nominees, who had been held up by Sen. Ted Cruz (R-TX) until today due to Biden’s initial waiver of sanctions on NS2.

In a press conference, White House Press Secretary Psaki stated that no Russian financial institution is safe if Russia continues to escalate, repeatedly referencing Russia’s top 2 banks as potential targets. Psaki highlighted that the authority announced on 2/22 enable the Biden administration to add any Russian financial institution to the sanctions list.

Psaki stated that in addition to targeting elites and their families, and imposing sanctions on additional financial institutions, other options on the table to impose costs for Russia’s behavior would include export controls – highlighting these controls would focus on areas Russia needs for development for the future, including high tech sectors like AI, biotech, and semiconductors.

In a separate press conference, State Department Spokesman Price underscored that no Russian financial institution is safe from potential sanctions, and also noted plans to target Russia’s two largest banks if the invasion proceeds. He also reiterated Psaki’s assessment of U.S. options in the event of further Russian aggression. Secretary of State Blinken has also stated “Russia will pay an even higher price for any further invasion of Ukraine.”

2/22/22

In response to Russia’s recognition of the independence of 2 breakaway regions in Ukraine, the White House imposed sanctions on Russian financial institutions VEB and Promsvyazbank, imposed property blocking sanctions and visa restrictions on Denis Aleksandrovich Bortnikov, Aleksandr Vasilievich Bortnikov, Petr Mikhailovich Fradkov, Vladimir Sergeevich Kiriyenko, and Sergei Vladilenovich Kiriyenko, and imposed sanctions on transactions involving Russian sovereign debt, cutting Russia off from Western financing.

Deputy National Security Advisor Daleep Singh said in a press conference following Biden’s remarks that elites in Russia are “on notice” that they and their families could be subject to property blocking sanctions and visa restrictions. Additional financial institutions, especially those involved in financing Russia’s aggression against Ukraine, could also be sanctioned in the days and weeks ahead. Singh also stated significant export controls could be imposed if Russian aggression continues, but did not give an indication which sectors would be targeted.

While Congress will be unable to act on legislation for the next several days, and was unable to reach consensus before recessing due to disagreements over triggers for sanctions and the approach to the Nord Stream 2 pipeline, there is still significant appetite in Congress for further action. Attached is a tracker on introduced legislation that would impose sanctions on Russia – which gives an idea what’s in the pipeline on Congress’s end, though anything that passes after they return to session will likely be more punitive, rather than focused on deterrence, given Putin’s latest actions. Specifically, the Defending Ukraine Sovereignty Act from SFRC Chairman Menendez (D-NJ) received White House input and approval, and initially received Republican engagement, so it provides an indication of the direction the Biden administration wants to go, and what could receive bipartisan congressional support.

BGR Expert Commentary

Sanctioned Financial Institutions

  • VEB (2/22)
  • Promsvyazbank (2/22)
  • Sberbank (2/24)
  • VTB (2/24)
  • Otkritie (2/24)
  • Novikom (2/24)
  • Sovcom (2/24)

Additional Sanctioned Entities

  • Nord Stream 2 AG (2/23)
  • Limited Liability Company Atlant S (2/24)
  • Limited Liability Company Inspira Invest A (2/24)

Sanctioned Persons

  • Denis Aleksandrovich Bortnikov (2/22)
  • Aleksandr Vasilievich Bortnikov (2/22)
  • Petr Mikhailovich Fradkov (2/22)
  • Vladimir Sergeevich Kiriyenko (2/22)
  • Sergei Vladilenovich Kiriyenko (2/22)
  • Michael Warnig (2/23)
  • Sergei Sergeevich Ivanov (2/24)
  • Sergei Borisovich Ivanov (2/24)
  • Andrey Patrushev (2/24)
  • Nikolai Platonovich Patrushev (2/24)
  • Ivan Igorevich Sechin (2/24)
  • Igor Ivanovich Sechin (2/24)
  • Alexander Aleksandrovich Vedyakhin (2/24)
  • Andrey Sergeyevich Puchkov (2/24)
  • Yuriy Alekseyevich Soloviev (2/24)
  • Galina Olegovna Ulyutina (2/24)

Debt and Equity Prohibitions

  • Sberbank (2/24)
  • Gazprombank (2/24)
  • Russian Agricultural Bank (2/24)
  • Gazprom (2/24)
  • Gazprom Neft (2/24)
  • Transneft (2/24)
  • Rostelecom (2/24)
  • RusHydro (2/24)
  • Alrosa (2/24)
  • Sovcomflot (2/24)
  • Russian Railways (2/24)
  • Alfa-Bank (2/24)
  • Credit Bank of Moscow (2/24)