US launches new round of sanctions against bitcoin miner and others helping Russia evade sanctions


The US Treasury Department announced on Wednesday that it is expanding its wide range of sanctions to include companies and individuals who help Russia evade the impact of economic sanctions imposed on Moscow.

Treasury officials said the department is now targeting Russian commercial bank Transkapitalbank, as well as a network of more than 40 people, including oligarch Konstantin Malofeyev, who they say are helping the Kremlin avoid a wave of economic sanctions .

The Biden administration has also said it is cracking down on companies operating in Russia’s virtual currency mining industry, including Bitriver, which help the country monetize its exports and other natural resources.

“Treasury can and will target those who evade, attempt to evade, or help evade U.S. sanctions on Russia because they help support Putin’s brutal war of choice,” the undersecretary for terrorism and government said. financial intelligence Brian Nelson in a press release. .

“The United States will work to ensure that the sanctions we have imposed, in close coordination with our international partners, degrade the Kremlin’s ability to project power and finance its invasion,” he added.

As a Russian private bank, Transkapitalbank has offered to help Moscow avoid detection and sanctions-derived restrictions through a proprietary internet-based banking system known as TKB Business, the Treasury Department said in a statement. press release announcing the sanctions.

This system, Treasury officials said, is an alternative communication channel to the Society for Worldwide Interbank Financial Telecommunication, or SWIFT, network. It is also designed to process US dollar payments for sanctioned customers.

Earlier this year, the United States, the European Union, Canada and the United Kingdom cut off a handful of Russian banks from the SWIFT financial network, one of Washington’s most powerful moves yet to insulate the Russia from the world market and cripple its economy.

This decision effectively prevented Russia from communicating securely with banks beyond its borders.

The Treasury also said it was stepping up efforts to quash a global “sanctions evasion and malign influence” network run by Russian oligarch Malofeyev.

Malofeyev was first targeted by the United States in 2014 for his role in activities that “threaten the peace, security, stability, sovereignty or territorial integrity of Ukraine”. At that time, the Office of Foreign Assets Control noted that Malofeyev was one of the main sources of funding for Russians promoting separatism in Crimea.

“In recent years,” the Treasury said on Wednesday, “Malofeyev, covertly or through intermediaries, has supported pro-Russian activities that undermine democracy, interfere in elections and degrade security and stability in a multitude of country”.

The announcement also represents the Biden administration’s first-ever attempt to sting Russia’s virtual currency mining industry.

Among the companies targeted by US sanctions is Bitriver, a company founded in 2017 that operates its mining facilities with hydroelectric power.

The Office of Foreign Assets Control has named 10 Russian subsidiaries of Bitriver in its latest wave of sanctions.

“Russia has a comparative advantage in crypto mining due to its energy resources and a cold climate,” Treasury officials said Wednesday. “However, mining companies are dependent on imported hardware and fiat payments, which makes them vulnerable to sanctions.”

“The United States is determined to ensure that no asset, no matter how complex, becomes a mechanism for the Putin regime to offset the impact of sanctions,” they added.

– CNBC’s MacKenzie Sigalos contributed to this report.


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