UPDATED 9:39 AM PT — Monday, January 28, 2019
The Treasury Department has lifted sanctions on three Russian companies with ties to oligarch Oleg Deripaska. In a statement Sunday, the Treasury announced Russian aluminum maker Rusal, industrial consortium En+ Group and energy company EuroSibEnergo aren’t blacklisted any longer after Deripaska divested from all three.
Treasury officials said the sanctions were targeting Deripaska, who remains blacklisted, but now there’s no need to keep sanctions on Russian companies.
“If anything, we are trying to de-link these companies so that they will not be under the influence and control of a sanctioned oligarch, that’s our objective,” stated Treasury Secretary Steven Mnuchin.
Congressional Democrats have opposed the Treasury’s move ever since Deripaska said he would comply with a U.S. request to divest last year.
The Rusal sanctions were imposed last April, producing a rise in global aluminum prices and a rise of anti-American sentiments in Russia.
Democrats have argued the sanctions should remain in place to — as they put it — keep pressure on Russia.
“The reason these were imposed was because of the malevolent actions of Deripaska and the Kremlin — they are intended to influence the Kremlin’s behavior, and so what has changed that merits now the relaxation of these sanctions?” asked Democrat Representative Adam Schiff.
Treasury officials said now that Deripaska has divested, the department chose American executives to oversee Rusal assets in the U.S. The department’s move is also expected to boost Russian-American trade, and help President Trump bring down aluminum prices for U.S. consumers.
Additionally, the Treasury said there is a difference between the people of Russia and friends of Vladimir Putin.
“Rusal was picked up not because we were targeting Rusal, but because we were targeting the ownership of Rusal,” said Secretary Mnuchin. “Our objective was not to put Rusal out of business.”
Meanwhile, a separate report has suggested the Rusal sanctions have been inefficient to keep corrupt Russian oligarchs in check. According to Bloomberg, Deripaska’s personal wealth rose by $679 million this month alone despite the sanctions.
Some are saying U.S. restrictions should target personal assets of the Kremlin’s affiliates rather than Russian companies with tens of thousands of employees in that country.
“In the old days, when governments did sanctions, they would sanctions the people. The U.S. government would sanction the Iranian people, and then the Iranian leaders would take in 747s of caviar and champagne for the leadership of the country, not the people. Now all of a sudden the thing is turned of its head, the people are being left alone, but the top guys are getting their money frozen, and that infuriates them.” — Bill Browder, anti-corruption campaigner
The Treasury Department said Rusal sanctions could be lifted by the end of this month. Meanwhile, Trump administration officials also reiterated their efforts fighting the Kremlin’s corruption and money laundering will continue.