U.S. officials warn Moscow there will 'much more economic pain' if it doesn't stop its 'malign' cyber activities as Treasury hits Russian entities with a fresh round of sanctions

  • Trump administration officials said Tuesday that they are prepared to impose more economic pain on Russia if it does not change its behavior
  • 'We can bring much more economic pain to bear using our powerful range of authorities,' an official at Treasury told the U.S. Senate
  • The Treasury Department imposed new sanctions on two Russians, one Russian company and one Slovakian firm, already
  • Said in a statement the actions were in retaliation for helping a Russian company avoid sanctions over its illegal cyber hacks
  • Trump's administration has also announced sanctions on Russian shipping over the transfer of refined petroleum products to North Korea in violation of U.N. restrictions in a separate act. 

Washington is prepared to impose more economic pain on Russia if it does not change its behavior, Trump administration officials said on Tuesday, as U.S. lawmakers pushed for stronger measures to counteract 'malign' Russian activities.

'Though Russia's malign activities continue, we believe its adventurism undoubtedly has been checked by the knowledge that we can bring much more economic pain to bear using our powerful range of authorities - and that we will not hesitate to do so if its conduct does not demonstrably and significantly change,' Acting Deputy Treasury Secretary Sigal Mandelker told the Senate Banking Committee.

The Treasury Department imposed new sanctions on two Russians, one Russian company and one Slovakian firm, already on Tuesday over actions it said helped another Russian company avoid sanctions over cyber-related activities.  

The Treasury Department imposed new sanctions on two Russians, one Russian company and one Slovakian firm, already on Tuesday over actions it said helped another Russian company avoid sanctions over cyber-related activities

The Treasury Department imposed new sanctions on two Russians, one Russian company and one Slovakian firm, already on Tuesday over actions it said helped another Russian company avoid sanctions over cyber-related activities

President Donald Trump has repeatedly said he would like better ties with Moscow, but although he met Russian President Vladimir Putin last month, relations between the two countries have come under further strain.

Members of Congress, where both chambers are controlled by Trump's fellow Republicans, have called for more action - including threatening sanctions 'from hell' - to punish Russia for actions including its annexation of Crimea, involvement in Syria's civil war and cyberattacks seeking to influence U.S. elections.

Two U.S. Senate committees held simultaneous hearings on Russia on Tuesday, where some lawmakers chastised administration officials for failing to sufficiently answer their questions, and for sending conflicting messages and doing too little to change Russian behavior.

Marina Igorevna Tsareva is one of the two individuals sanctioned for helping Divetechnoservices attempt to circumvent U.S. sanctions

Marina Igorevna Tsareva is one of the two individuals sanctioned for helping Divetechnoservices attempt to circumvent U.S. sanctions

Both Republicans and Democrats in Congress have criticized Trump, particularly after his summit with Putin in Helsinki last month, for failing to stand up to Moscow on issues including what they see as Trump´s failure to hold the Russian president accountable for Moscow´s meddling in the 2016 U.S. election.

Microsoft Corp said late Monday that hackers linked to the Kremlin sought to launch cyberattacks on the Senate and conservative American think tanks, warning of broader attacks ahead of congressional elections in November.

The Kremlin rejected the Microsoft allegations and said there was no evidence to support them. Moscow has repeatedly denied attempting to influence U.S. elections, including the 2016 presidential vote that brought Trump into office. U.S. intelligence agencies have concluded that Russia interfered in the 2016 campaign, seeking to tilt the vote in Trump's favor.

U.S. administration officials told the Senate hearings that existing sanctions were having an effect on Russia's economy, despite continuing behavior that concerns Washington.

Assistant Secretary of State Wess Mitchell told the Foreign Relations Committee that concern about sanctions has cost Russia $8 to $10 billion in arms deals. Without the American measures, Moscow's behavior would be further 'off the charts,' Mitchell said.

Mitchell also said foreign direct investment in Russia has fallen by 80 percent since 2013, 'which is a pretty stunning number.'

Washington is prepared to impose more economic pain on Russia if it does not change its behavior, Trump administration officials said on Tuesday, as U.S. lawmakers pushed for stronger measures to counteract 'malign' Russian activities

Washington is prepared to impose more economic pain on Russia if it does not change its behavior, Trump administration officials said on Tuesday, as U.S. lawmakers pushed for stronger measures to counteract 'malign' Russian activities

'I think this administration has been clear that we are prepared to take additional steps,' Mitchell said. 'There is an escalatory ladder to sanctions. We are aware of what additional steps would be needed to make an even bigger point.'

Marshall Billingslea, assistant Treasury secretary for terrorism financing, told the Foreign Relations panel it was important that European allies, particularly in eastern Europe, do more to combat money laundering.

'There is an enormous amount of money that is still being exfiltrated from Russia by both organized crime and cronies surrounding Putin,' Billingslea said.

In an interview with Reuters on Monday, Trump said he would only consider lifting sanctions against Russia if it were to do something positive for the United States, for instance in Syria or in Ukraine.

Trump's administration also announced sanctions on Russian shipping over the transfer of refined petroleum products to North Korea in violation of U.N. restrictions.

Treasury said in a Tuesday statement that it was sanctioning two companies - Saint Petersburg-based Vela-Marine Ltd and Slovakia-based Lacno S.R.O. - and the two individuals helped Divetechnoservices evade previously imposed sanctions.

In June, the United States sanctioned Divetechnoservices, also based in Saint Petersburg, for procuring underwater equipment and diving systems for Russian government agencies, including Russia's FSB intelligence agency.

The Obama administration sanctioned the FSB in December 2016, citing the Russian government's aggressive harassment of U.S. officials and cyber operations aimed at the 2016 U.S. presidential election.

In its statement, the U.S. Treasury said the two individuals sanctioned on Tuesday - Marina Igorevna Tsareva and Anton Aleksandrovich Nagibin - had both helped Divetechnoservices attempt to circumvent U.S. sanctions.

The head of Vela-Marine told Reuters he did not understand why his firm was being designated. Speaking by telephone, Andrei Kuklin, head of the company, said: "Unfortunately I cannot comment. I don't understand what the problem is."

Reuters was unable to immediately determine contact information for Lacno, which does not have its own website and which does not list any contact number on the Slovak finance ministry registry of firms website.

Nagibin did not answer a call seeking comment. Reuters was not immediately able to identify contact information for Tsareva.

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