Trump administration targets Russian oligarchs and Putin allies with fresh sanctions

The US president has avoided directly criticising his Russian counterpart

Alexandra Wilts
Washington DC/Moscow
,Oliver Carroll
Friday 06 April 2018 09:00 EDT
Those affected by the sanctions include oligarch Oleg Deripaska (right) and many businessmen with direct links to Vladimir Putin
Those affected by the sanctions include oligarch Oleg Deripaska (right) and many businessmen with direct links to Vladimir Putin

The Trump administration has targeted Russian oligarchs and allies of Vladimir Putin in new sanctions for alleged “malign activity” around the world, the US Treasury Department has said.

Seven Russian oligarchs and 17 Russian government officials have been hit with the sanctions. A dozen Russian companies owned by the oligarchs have also been targeted, along with a state-owned arms-dealing company and a subsidiary bank.

The sanctions, coming amid pressure from Congress, are largely a reply to what US intelligence agencies say was Russian interference in the 2016 presidential election, although the Treasury Department has painted them as a response to a series of adversarial actions by Moscow, including aiding President Bashar al-Assad in Syria’s civil war and “malicious cyber activities”.

“The Russian government operates for the disproportionate benefit of oligarchs and government elites,” said Treasury Secretary Steven Mnuchin. “The Russian government engages in a range of malign activity around the globe, including continuing to occupy Crimea and instigate violence in eastern Ukraine, supplying the Assad regime with material and weaponry as they bomb their own civilians, attempting to subvert Western democracies, and malicious cyber activities.”

“Russian oligarchs and elites who profit from this corrupt system will no longer be insulated from the consequences of their government’s destabilising activities,” he added. While the administration has made moves to increase pressure on Russia, Mr Trump has avoided directly criticising Mr Putin and even invited the Russian leader to meet with him, possibly at the White House.

Mr Trump earlier this week said “nobody has been tougher on Russia” than him, but that it would be “would be a good thing, not a bad thing,” if the US got along with the Kremlin.

During a White House briefing, Press Secretary Sarah Huckabee Sanders said the fact that the president has signed off on and directed actions against Russia “speaks volumes”. She added that US officials would continue to work towards a meeting with Mr Putin at some point. “As the president has said, he wants to have a good relationship with Russia but that's going to depend on some of the actions by the Russians,” she said.

The lists of individuals and companies can be broadly divided into business and politics. The sanctions will touch two of the richest oligarchs in Russia. Victor Vekselberg, 10th in the Russian Forbes list with a fortune of $12.4bn (£8.8bn), and Oleg Deripaska, 23rd in the list with a fortune of $5.1bn, will both see the work of their multinational businesses hit severely.

The blacklists include businessmen closely associated with the president’s family or inner friendship group. Kirill Shamanov, who is reportedly was married to Yekaterina Tikhonova, the daughter of Vladimir Putin, is listed under the individual section. Igor Rotenberg, the son of the president’s former judo sparring partner, Arkady Rotenberg, is also mentioned.

The former chief of Mr Putin’s personal security service, Viktor Zolotov, is also on the lists. Few men are as trusted by the president as his former bodyguard. Their ties date back to the early 1990s, when both worked in St Petersburg for Mayor Anatoly Sobchak. Mr Zolotov was parachuted into national prominence in 2016, invited to head the newly formed National Guard. He is currently a member of the National Security Council.

The political section of the sanctions lists covers many of Russia’s most leading state officials. It features some of the president’s closest political associates including the head of the National Security Council, Nikolai Patrushev and the former prime minister Mikhail Fradkov. Of particular interest is the inclusion of Alexei Dyumin, the governor of Tula district. The former deputy minister of defence is occasionally dangled as Mr Putin’s potential future successor.

Washington has also put Russia’s state arms exporter Rosoboronexport on the sanctions list, meaning any country that trades with Russia’s defence or intelligence sectors will also be targeted.

“The fact that Rosoboronexport is the target confirms the true aim of the sanctions,” Russia’s state-run holding company Rostec said. “All this big talk and accusations are just an excuse to drive Russia out of the world arms market.”

Trump says only 'very stupid people don't want to get on better with Russia'

Moscow has interpreted the sanctions lists as an attempt to drive a wedge between the president and loyal oligarchs. Presidential spokesman Dmitry Peskov describe the US actions as a “war of sanctions” designed to cause a quarrel between Mr Putin and the country’s business elite.

Washington’s previous attempt to draw up a list of Kremlin-linked oligarchs in February was largely ridiculed in Moscow, owing to the broad nature of the lists and lack of bite. For many loyalists, inclusion even became a badge of honour.

This time, many of those included will feel the heat in their bottom line. “People like Deripaska and Vekselberg will not enjoy being in the same lists as Mexican drug dealers” said political consultant Evgeny Minchenko. “Business will be more difficult and they are the main victims. The bureaucrats will get over it.”

Mr Dyumin’s office said he considers the sanctions against Russia “unfriendly and counterproductive”. Mr Dyumin’s assistant told Reuters that the sanctions will not help in resolving issues between Washington and Moscow.

Trade minister Denis Manturov said that those companies who have fallen under the sanctions lists will be ”supported even more” by the government.

Russian state media have chosen to play down the affair. News of the new sanctions lists took up about a 30-second section about half an hour into the main news broadcasts. It followed much larger segments devoted to the alleged corruption of a middling railway manager in St Petersburg, an American fitness model who had been arrested for selling drugs and a drunk horse and cart driver arrested in Belarus.

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