U.S. releases names in “Kremlin report,” but classified material raises questions

Jan 31 2018

On Monday night, Jan. 29, the U.S. Treasury Department publicly released its much-anticipated “Kremlin report,” which singles out members of the Russian political and business elite with close ties to Vladimir Putin’s government.

The document explicitly names 114 senior officials and 96 oligarchs, while details about their income and evidence of corruption remain classified in a 100-page section of the report.

The report was prepared by the U.S. Treasury, the State Department and various intelligence agencies, as mandated by the Countering America’s Adversaries Through Sanctions Act (CAATSA) – a sanctions law signed by the U.S. president in August 2017 as a measure against Russia’s actions in Ukraine, human rights violations in Russia, and allegations of interference in the 2016 U.S. elections.

CAATSA requires the U.S. administration to provide Congress a list of “the most significant senior foreign political figures and oligarchs” with ties to the Kremlin, detailing their connections, source of wealth, family members’ business assets and evidence of corruption.

Among those on the list are Putin’s chief of staff Anton Vayno and prosecutor general Yuriy Chayka, as well as billionaires Roman Abramovich, Petr Aven, Mikhail Fridman and Оleg Deripaska – the latter is also under scrutiny for his connection to former Trump campaign manager Paul Manafort.

Reacting to the report on Monday, Andrei Piontkovsky, a visiting fellow at the Hudson Institute and a senior adviser with Free Russia Foundation, said the inclusion of so many people on the list – representing “the Kremlin’s phonebook and the Forbes list” – may not be taken seriously. In fact, many of the names on the list – which includes many from Putin’s “politburo” – are of huge political significance, says Piontkovsky, who previously participated in the Atlantic Council’s independent initiative to draw up a set of recommendations for determining the sanctions targets.

Ilya Zaslavskiy, a researcher with Free Russia Foundation, said even more individuals should be included in the report. The rather limited circle of people hints at indecision and only scratches the surface, he said. “As shown in our research in 2016, when the sanctions target only a small number of people, it doesn’t actually work,” he says.

Notably, the new report states that the list revealed to the public does not in of itself imply an imposition of sanctions, nor does it impose any legal consequences for people with business ties to those on the list. However, on Tuesday, Jan. 30, U.S. Treasury Secretary Steven Mnuchin said that new sanctions will be implemented after the report initially drew criticism earlier in the day. Experts say the classified part of the report will provide the basis for further sanctions, which could be announced within a few months.

Piontkovsky said the fact that no new sanctions have yet been announced, and that part of the report remains classified, has come as a relief to Moscow – but it may be a mistake to interpret the report in this way. While Piontkovsky would support the public release of the full report, especially for the benefit of the Russian public, he says the very existence of the document is “an imminent political threat for Russia’s entire political class.”

“A mechanism has been created to impose the toughest sanctions – namely, to freeze and confiscate $1 trillion – at any time, depending on the degree of Moscow’s aggression. This is an astronomical figure!” said Piontkovsky.

Zaslavskiy notes that the absence of sanctions in the current version of the “Kremlin report” is a technicality to avoid legal action, but that the report actually sends a very strong political message to the Russian government.

Zaslavskiy also expects the U.S. Congress to call for more significant measures, and he expects more individuals to be added to the “Kremlin report” over the course of this year.

“I am convinced that the list will be expanded and I am sure that sanctions will be imposed on specific individuals,” he said. “On our part, we will work with senators to identify names that we believe are currently missing from the list.”

By Valeria Jegisman

The document explicitly names 114 senior officials and 96 oligarchs, while details about their income and evidence of corruption remain classified in a 100-page section of the report.

The report was prepared by the U.S. Treasury, the State Department and various intelligence agencies, as mandated by the Countering America’s Adversaries Through Sanctions Act (CAATSA) – a sanctions law signed by the U.S. president in August 2017 as a measure against Russia’s actions in Ukraine, human rights violations in Russia, and allegations of interference in the 2016 U.S. elections.

CAATSA requires the U.S. administration to provide Congress a list of “the most significant senior foreign political figures and oligarchs” with ties to the Kremlin, detailing their connections, source of wealth, family members’ business assets and evidence of corruption.

Among those on the list are Putin’s chief of staff Anton Vayno and prosecutor general Yuriy Chayka, as well as billionaires Roman Abramovich, Petr Aven, Mikhail Fridman and Оleg Deripaska – the latter is also under scrutiny for his connection to former Trump campaign manager Paul Manafort.

Reacting to the report on Monday, Andrei Piontkovsky, a visiting fellow at the Hudson Institute and a senior adviser with Free Russia Foundation, said the inclusion of so many people on the list – representing “the Kremlin’s phonebook and the Forbes list” – may not be taken seriously. In fact, many of the names on the list – which includes many from Putin’s “politburo” – are of huge political significance, says Piontkovsky, who previously participated in the Atlantic Council’s independent initiative to draw up a set of recommendations for determining the sanctions targets.

Ilya Zaslavskiy, a researcher with Free Russia Foundation, said even more individuals should be included in the report. The rather limited circle of people hints at indecision and only scratches the surface, he said. “As shown in our research in 2016, when the sanctions target only a small number of people, it doesn’t actually work,” he says.

Notably, the new report states that the list revealed to the public does not in of itself imply an imposition of sanctions, nor does it impose any legal consequences for people with business ties to those on the list. However, on Tuesday, Jan. 30, U.S. Treasury Secretary Steven Mnuchin said that new sanctions will be implemented after the report initially drew criticism earlier in the day. Experts say the classified part of the report will provide the basis for further sanctions, which could be announced within a few months.

Piontkovsky said the fact that no new sanctions have yet been announced, and that part of the report remains classified, has come as a relief to Moscow – but it may be a mistake to interpret the report in this way. While Piontkovsky would support the public release of the full report, especially for the benefit of the Russian public, he says the very existence of the document is “an imminent political threat for Russia’s entire political class.”

“A mechanism has been created to impose the toughest sanctions – namely, to freeze and confiscate $1 trillion – at any time, depending on the degree of Moscow’s aggression. This is an astronomical figure!” said Piontkovsky.

Zaslavskiy notes that the absence of sanctions in the current version of the “Kremlin report” is a technicality to avoid legal action, but that the report actually sends a very strong political message to the Russian government.

Zaslavskiy also expects the U.S. Congress to call for more significant measures, and he expects more individuals to be added to the “Kremlin report” over the course of this year.

“I am convinced that the list will be expanded and I am sure that sanctions will be imposed on specific individuals,” he said. “On our part, we will work with senators to identify names that we believe are currently missing from the list.”

By Valeria Jegisman

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