Industry News

Biden Administration Expands Russia Sanctions

Apr. 20, 2021
By: Michael N. Coopersmith

On April 15, 2021 President Joe Biden issued an Executive Order (Order) authorizing sanctions on the Russian Federation (Russia) aimed at curbing what the administration described as “harmful foreign activities” taken by the Russian government and intelligence services against U.S. sovereignty and interests.

Immediately following the Order, the U.S. Treasury Department (Treasury) issued a directive prohibiting U.S. financial institutions from participation in the primary market for ruble or non-ruble denominated bonds issued after June 14, 2021 by the Central Bank of Russian, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation. Additionally, the directive prohibits the lending of ruble or non-ruble denominated funds to the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation.

Treasury also designated six Russian technology companies who the administration has identified as providing support to the Russian Intelligence Services’ cyber program, formally naming the Russian Foreign Intelligence Service (SVR), also known as APT 29, Cozy Bear, and The Dukes, who Treasury identified as the perpetrators of what the administration has referred to as the “cyber espionage campaign” that exploited the SolarWinds Orion platform in 2020. On the topic of cyber security the administration stated, “we will continue to hold Russia accountable for its malicious cyber activities, such as the SolarWinds incident, by using all available policy and authorities,” further stating that such actions place an undue burden on primarily private sector victims who are forced to bear the unusually high cost of mitigating such incidents.

An additional 32 entities and individuals have also now been added to the Office of Foreign Asset Control (OFAC) Specially Designated National (SDN) List for carrying out what the Biden administration described as Russian government-directed attempts to influence the 2020 U.S. presidential election, with the U.S. expelling ten representatives of Russian intelligence services from the Russian diplomatic mission in Washington, DC. The move to expel diplomats is thought to be primarily a symbolic action and has not been directly tied to any specific Russian action.

Finally, the U.S., in collaboration with the EU, the UK, Australia, and Canada sanctioned eight individuals and entities associated with Russia’s ongoing occupation of Crimea. While sanctions were not related to the recent buildup of Russian troops in Crimea and along the eastern Russian border with Ukraine, following the publication of the Order the administration stated, “the Transatlantic community stands united in supporting Ukraine against unilateral Russian provocations along the Line of Contact in eastern Ukraine, in occupied Crimea, and along Ukraine’s borders, as well as agreeing on the need for Russia to immediately cease its military buildup and inflammatory rhetoric.”

In response to the aforementioned U.S. actions, Russian Foreign Minister Sergey Lavrov said on Friday April 16th that Russia will expel ten U.S. diplomats from the country, restrict the activity of U.S. nonprofit groups operating in Russia, and impose new limits on American diplomats and diplomatic outposts. As tensions continue to rise it has been reported that an in-person meeting between U.S. President Joe Biden and Russian President Vladimir Putin may be in the works, with Vienna and Prague seen as two potential meeting locations.  

If you have any questions or would like more information about the recently expanded Russia sanctions do not hesitate to contact an attorney at Barnes, Richardson & Colburn LLP.