Earlier this month, on June 11, the Treasury Department imposed new sanctions on Russian companies and individuals that provide support to the FSB’s cyberwarfare efforts. The decision was made not long after President Trump’s statement on bringing Russia back into the G-7, and before a meeting of EU leaders that may extend existing sanctions on Russia by six months.
The five companies targeted by the Treasury’s round of sanctions are Digital Security, ERPScan, Embedi, Kvant Scientific Research Institute, and Divetechnoservices. The latter has provided underwater equipment for the FSB, which has actively been tracking underwater communications cables that transmit much of the world’s telecommunications data. Three of Divetechnoservices’ employees have also been singled out by Department of the Treasury’s Office of Foreign Assets Control. Their assets have been frozen, and they can no longer conduct business with Americans.
The basis for this decision lies in former President Barack Obama’s Executive Order 13694 (“Blocking the Property of Certain Persons Engaging in Significant Malicious Cyber-Enabled Activities”) and the CAATSA act (Countering America’s Adversaries Through Sanctions Act). The Treasury went forward with these sanctions in response to cyberattacks directed not just towards the United States, but to Ukraine as well, in the form of NotPetya—a cyber outbreak which is believed to have made use of stolen hacking tools of the National Security Agency. Treasury Secretary Steven T. Mnuchin stated the following:
“The United States is engaged in an ongoing effort to counter malicious actors working at the behest of the Russian Federation and its military and intelligence units to increase Russia’s offensive cyber capabilities. The entities designated today have directly contributed to improving Russia’s cyber and underwater capabilities through their work with the FSB and therefore jeopardize the safety and security of the United States and our allies.”
President Trump has delivered mixed rhetoric regarding Russia leading up to this. Despite calling himself Russia’s “worst nightmare,” he stated that the country should be allowed back into what is now the G-7. Russia had been removed four years ago in response to its annexation of Crimea. This action had resulted in sanctions on energy, defense, and financial sectors by European Union leaders. It is likely that in their Brussels meeting this week, these EU heads will make the call to extend these sanctions for a further six months.
On June 28, the Kremlin and the White House both released statements announcing that President Trump and his Russian counterpart, Vladmir Putin, will meet at a bilateral summit in Helsinki, Finland on July 16. According to the short statement issued by the White House, Trump and Putin will discuss “relations between the United States and Russia and a range of national security issues.”