Banks That Deal With Sanctions-Hit Russians Will Face Ire of U.S.

  • Senior U.S. official warns of ‘consequences’ for errant firms
  • Treasury’s Mandelker: oligarchs will suffer for Russia’s sins
Sanctions Keep Sinking the Russian Ruble

British banks that deal with the Russian oligarchs and companies on a new American sanctions list will face “consequences,” according to a senior U.S. Treasury official.

“We’re focused on countering the full range of Russian malign activity,” Sigal Mandelker, the Treasury’s under-secretary in charge of economic sanctions, said at a roundtable discussion at the U.S. embassy in London on Tuesday.

“We’re sending a very clear message to Russian oligarchs and elites who profit from what we consider to be a corrupt system, that they are no longer going to be insulated from the consequences of their government’s destabilizing activities,” she said.

Mandelker said the U.S. could impose additional restrictions on any company dealing with the Russian tycoons and government officials penalized in the latest sanctions rolled out last week. The most prominent oligarch on the list is metals magnate Oleg Deripaska, 50, who runs United Co. Rusal, one of the world’s biggest aluminum companies.

“There of course would be consequences for U.K. financial institutions” that continue to do business with these people, said Mandelker. “There could be secondary sanctions implications.”

U.S. authorities have fined European banks for breaking sanctions before. In 2014, BNP Paribas SA was slapped with a record $8.97 billion fine by American authorities for violating domestic sanctions against Cuba, Sudan and Iran. Standard Chartered Plc paid a $667 million charge in 2012 after the U.S. found it had violated sanctions against Iran.

Mandelker will also visit France and Germany as part of a three-day tour of Europe aimed at bolstering diplomatic sanctions against Iran, North Korea and Russia.

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