Taking on Russia's ‘oligarchs’ Meduza looks at the businessmen, state officials, and companies targeted in the latest U.S. sanctions

On Friday, the world got a look at the latest U.S. sanctions against Russia. The U.S. Treasury Department’s new “designations” target seven Russian “oligarchs” and 12 companies they own or control, 17 senior Russian government officials, and a state-owned Russian weapons trading company and its subsidiary, a Russian bank. Washington says the measures are a response to “a range of malign activity around the globe” conducted by the Russian government, which operates “for the disproportionate benefit of oligarchs and government elites,” Treasury Secretary Steven Mnuchin said in a press release.

The new list, which is supposed to single out “those who benefit from the Putin regime and play a key role in advancing Russia’s malign activities,” focuses on individuals and companies that work with the Russian government or in Russia’s energy sector. Washington also sanctioned Rosoboronexport and its subsidiary the Russian Financial Corporation for collaborating with the Syrian government.

Below, you’ll find a list of everyone and everything swept up in the Treasury Department’s new sanctions. Washington’s official justifications for these designations appear in quotes.

The businessmen

The total worth of all the “oligarchs” sanctioned by the U.S. government on Friday added up to $29.5 billion. By Friday evening, falling stocks erased $1.25 billion from this total, according to the newsletter The Bell.

The U.S. Treasury Department also sanctioned 12 companies associated with the businessmen listed above, including Basic Element, Rusal, En+ Group, the Kuban agroholding company, Russian Machines, Igor Rotenberg’s NPV Engineering, Kirill Shamalov’s Ladoga Management, Oleg Deripaska’s GAZ Group, and Viktor Vekselberg’s Renova Group.

Top managers at state companies

All the top managers listed above were added to the Treasury Department’s sanctions list as state officials.

State officials

What do these sanctions do?

Everyone added to the Treasury Department’s list is banned from traveling to the United States. American officials have also frozen all assets belonging to these individuals and companies in the U.S., and American citizens are prohibited from doing any business with them. These rules apply to any ventures where the sanctions individuals own at least half of the business. The U.S. government did not implement “secondary sanctions,” which would have also enforced the restrictions on non-American citizens and businesses. Secondary sanctions, according to The Bell, were the “real risk” that worried Russian oligarchs.

Americans and American companies have until June 5 to cut off all collaboration with the sanctioned companies. All payments for these contracts, moreover, must be transferred to a special account in a U.S. bank. By June 15, these American citizens and companies must file reports with the Treasury Department, detailing the termination of their collaboration with any of the sanctioned businesses or individuals. Any Americans working for the Russian individuals or companies sanctioned by the U.S. government will have to find new jobs.

Oleg Deripaska’s businesses have already posted major losses in financial markets. Stocks in Rusal, which earned 10 percent of its revenue last year ($1.4 billion) in the United States, fell 17.7 percent on the Russian stock exchange, and securities in Deripaska’s company En+ Group fell more than 20 percent in London. “The company regrets this development,” a Rusal spokesperson told the magazine RBC. In late 2017, En+ Group’s net debt reached $12.2 billion, while Rusal’s net debt was $7.7 billion.

Aside from Deripaska, only Viktor Vekselberg has sizable investments in the United States, where he owns shares in the venture fund Maxfield Capital, which operates in the U.S., Israel, and Europe. In California alone, Maxfield has investments in dozens of companies, such as the e-health app Doctor Chrono and and online education platform Edwin. Suleiman Kerimov also has investments in Silicon Valley (in Snapchat and SoundHound).

Mikhail Prokhorov is likely doing backflips today. In late February, Prokhorov’s Onexim Group sold its last 6 percent in Rusal to Vekselberg and Leonard Blavatnik for an estimated $660 million.

There was virtually no change in the value of shares in Russian state companies named by the U.S. Treasury Department and state companies whose directors were sanctioned on Friday, probably due to the fact that Gazprom has been under American sanctions for years already.

What is the “Kremlin list”?

Published in January 2018, the “Kremlin list” was prepared in compliance with the Countering America’s Adversaries Through Sanctions Act (CAATSA), which the U.S. Congress adopted in the summer of 2017. The Treasury’s actions on Friday are Washington’s latest response to Russia’s alleged meddling in the 2016 U.S. presidential election. CAATSA enshrined in law sanctions against Russia over Moscow’s annexation of Crimea and intervention in eastern Ukraine, making the policy harder to rescind than a simple executive order.

The “Kremlin list” included the names of many top state officials and businessmen considered to have close ties to Vladimir Putin. The list didn’t include sanctions when it was published in January, but Secretary Steven Mnuchin promised they weren’t far off.