The U.S. Treasury has sanctioned a Russian bank with ties to the United Arab Emirates, signaling to allies that it will start cracking down on sanctions evasion as the war in Ukraine enters its second year.
The fresh round of sanctions and export controls on more than 250 individuals and entities includes MTS Bank, which has branches in Moscow and Abu Dhabi. The UAE’s central bank granted MTS a license last year to operate there. Thousands of Russians went to the UAE after the invasion began and were the biggest international buyers of Dubai real estate last year, according to the brokerage Betterhomes. The U.K. also designated MTS on Friday.
In addition to financial-sector sanctions, the U.S. unveiled measures aimed at Russia’s defense and energy sectors with the goal of constraining industries key to President Vladimir Putin’s war machine. Among the targets are the Credit Bank of Moscow, one of Russia’s ten largest banks, several wealth management firms, arms dealers and suppliers of materials used in weapons and military equipment. Notably, the U.S. is sanctioning German and Swiss nationals it says are tied to procuring Western technologies for Russia.
“Over the past year, we have taken actions with a historic coalition of international partners to degrade Russia’s military-industrial complex and reduce the revenues that it uses to fund its war,” Treasury Secretary Janet Yellen said in a statement. “Our sanctions have had both short-term and long-term impact, seen acutely in Russia’s struggle to replenish its weapons and in its isolated economy. Our actions today with our G7 partners show that we will stand with Ukraine for as long as it takes.”
In addition, nearly 90 companies in Russia, China and other countries will be placed on the Commerce Department’s entity list for sanctions evasion, according to the White House. The listings are meant to prevent the targeted companies from buying semiconductors, software or other technologies manufactured in the U.S. or with American intellectual property.
Reports indicate that Russia has been vacuuming up consumer goods through third countries to help keep its equipment and weapons systems from breaking down.
The U.S. and its allies will target Russia’s lucrative commodities sector with measures designed to limit Russia’s energy production capabilities while keeping markets stable. The U.S. will also expand its sanctions on Russian metals and mining. And the Commerce Department will work with the G-7 to issue new restrictions to prevent Iranian drone components from being used in Ukraine.
Going forward, the U.S. will place a renewed emphasis on enforcing the thousands of sanctions that have been levied on Russia since its annexed Crimea in 2014 and in the wake of the invasion of Ukraine that began on Feb. 24, 2022. To enhance those efforts, the G-7 is creating an “Enforcement Coordination Mechanism” which will be led by the U.S. in its first year.
The U.S. is sending Ukraine another $2 billion in security assistance, which will include unmanned aerial systems, electronic warfare detection equipment, and ammunition for 155mm artillery systems and High Mobility Artillery Rocket Systems or HIMARS.