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US Sanctions Target Alfa Group Board Members Over Ukraine Conflict
The U.S. Department of the Treasury has taken unprecedented action in response to Russian aggression in Ukraine by targeting the Alfa Group, one of Russia’s most influential oligarchs.
The Treasury’s Office of Foreign Assets Control (OFAC) has issued a number of separate measures against the Alfa Group and its Board members in an effort to disrupt their ability to use and hide assets within the global financial system. The measures place sanctions on seven senior board members, restricting their access to the U.S. financial system and prohibiting any U.S. citizens from conducting business with the individuals or their affiliated entities.
The Alfa Group is a Moscow-based consortium owned by billionaire Mikhail Fridman and his partners, that specializes in investments in banking, telecoms, retail, oil and gas, and other industries. The Alfa Group is widely believed to have close ties to Russian President Vladimir Putin and has played a key role in the country’s energy sector.
The measures issued by OFAC are a direct response to the situation in Ukraine, where the Alfa Group and its board members are alleged to have been actively working with and supporting the actions of Russian forces, including providing crucial financial support for the separatist movements in eastern Ukraine.
The U.S. government has emphasized that the sanctions will remain in effect until the Alfa Group, its Board members, and their affiliated entities cease their activities in Ukraine and comply with the terms of the Minsk agreements. Furthermore, the Treasury has made it clear that these actions are part of a larger diplomatic effort to address the crisis in Ukraine, and that additional sanctions can be expected if the situation does not improve.
These steep measures are a significant move toward isolating the Alfa Group and its Board members from the U.S. financial system and restricting their access to U.S. assets and technology. They are a clear signal from the U.S. government that its sanctions against Russian entities will remain in place until the situation in Ukraine is resolved.As tensions continue to rise between the United States and Russia over the Ukraine conflict, the U.S. government has now imposed sanctions on several board members of the Alfa Group, Russia’s largest financial-industrial group.
The sanctions are related to the recent U.S. indictment of 12 Russian intelligence officers, accused of hacking and disseminating emails and documents from the Democratic National Committee and Hillary Clinton’s campaign during the 2016 presidential election.
The Alfa Group has been widely discussed in the news, as it is owned by several prominent Russian businessmen with close ties to President Vladimir Putin. The group controls Alpha Bank, Russia’s largest private bank, and is involved in such industries as oil & gas, investment, telecom, and insurance.
On August 8th, 2018, the U.S. Treasury Department announced the sanctions on nine members of the Alfa Group’s board of directors, in an effort to target those who are “benefiting from, promoting or enabling activities contrary to U.S. national security and foreign policy interests.”
Among the nine board members, the Treasury Department has sanctioned Alexey Kuzmichev, a billionaire who is one of the group’s founders and one of its principal shareholders. Other members of the board include Petr Avrov, Mikhail Fridman, Oleg Deripaska and German Khan.
These sanctions have been a major blow to the Alfa Group, as members are now unable to have any contact with U.S. citizens or any business dealings with U.S. companies. Furthermore, their foreign assets are now frozen and no U.S. individuals are allowed to perform or facilitate any deals which involve the board members.
In retaliation, the Kremlin has stated that the new sanctions amount to “blackmail” and are a “direct and obvious attempt [by the U.S.] to influence the upcoming presidential election,” referring to the presidential election due to take place in March 2018.
In response, the White House has denied any allegations of trying to influence the election and stated that the sanctions were decided long before the presidential campaign had even begun.
The sanctions against the members of the Alfa Group’s board of directors are the latest in a series of moves by the U.S. government to put pressure on Russia over its actions in Ukraine. In March 2017, the U.S. imposed sanctions on nearly 40 individuals and companies, including Russia’s state-owned oil company Rosneft.
The U.S. is not the only country to put pressure on Russia, as the European Union and Canada have also imposed a number of sanctions against the country in recent years.
It remains to be seen how these latest sanctions will affect Russia’s role in the Ukraine conflict, and whether the U.S. will impose more sanctions in the future. For now, the Alfa Group’s board members and their families will have to live with the crippling economic consequences of these sanctions.
