On Tuesday, the United States of America imposed financial sanctions on Russian entities and persons, including those close to Russian President Vladimir Putin, in response to his decision to recognize the independence of the Ukrainian separatist regions of Donetsk and Lugansk and deployed forces there.
A US Treasury statement said the sanctions included two major Russian state-owned financial institutions, additional restrictions on Russia’s sovereign debt, and sanctions against five Kremlin-linked elites.
The sanctions included the Foreign Economic and Development Corporation Bank (VEB) and the joint public company Promsvyazbank (PSB), along with 42 of its subsidiaries.
“Today’s actions, taken in coordination with our partners and allies, begin the process of dismantling the Kremlin’s financial network and its ability to fund destabilizing activity in Ukraine and around the world,” Treasury Secretary Janet Yellen said in the statement.
“We continue to monitor Russia’s actions and if it invades Ukraine, the United States will quickly impose extensive economic sanctions that will have a severe and lasting impact on the Russian economy,” she added.
The statement said the measure restricts Russia’s ability to finance defense-related contracts and raise new funds to fund its campaign against Ukraine.
The Treasury has also designated influential Russians and their family members in Putin’s inner circle who are believed to be involved in the Russian system’s governing circle, including the chairman and CEO of PSB.
The portfolio of VEB assets is $53 billion, according to the statement, which said that it is among the five largest financial institutions in Russia.
The ministry has also taken measures against giant Russian oil cargo ships.
The financial sanctions included figures the statement described as being from Putin’s inner circle and their family members.
Among them is the son of the director of the Federal Security Service, Alexander Vasilievich Bortnikov.
Peter Fradkov, who is the Chairman and CEO of PSB, is also the son of Mikhail Fradkov, the former Prime Minister of Russia and the former director of Russia’s Foreign Intelligence Service (SVR).
And Vladimir Sergeyevich Kiriyenko, son of Sergei Kiriyenko, is the first deputy chief of staff of the Presidential Office.
The ministry also increased restrictions on dealing in Russia’s sovereign debt, which led to further cutting off Russia from sources of revenue to finance its government, including its invasion of Ukraine, according to the statement, which said that these restrictions significantly cut off Russia’s primary path to raising funds.