New sanctions to target Russian ‘cronies’

A new round of U.S. sanctions against Russia will target “cronies” that are tied to critical banks and companies in the hopes of further squeezing Russia’s economy, a White House official said Saturday.

The additional sanctions, announced late Friday by G-7 leaders, are expected to come early next week, said Ben Rhodes, White House deputy national security adviser.

{mosads}The new sanctions will pull from ones imposed earlier this year on individuals with crucial assets in Russia’s economy, but will go further, Rhodes told reporters aboard Air Force One on Saturday as President Obama made his way to Malaysia.

They will hit not just the previously sanctioned individuals “but entities associated with them, so that could include banks and companies,” Rhodes said. “So we believe that these sanctions can have a significant impact.”

Rhodes used the word “cronies” to describe those individuals that control large parts of the Russian economy.

And when imposing the sanctions on “entities under their control, you are imposing a significant economic impact beyond simply sanctioning an individual,” he added.

When asked about the reaction the U.S. hopes to get out of Russia, Rhodes said “I don’t think they’ll like them.”

The move by the U.S. and other G-7 nations comes because of the plans to hold elections in Ukraine next month.

Sectorial sanctions remain on the table but the U.S. won’t act on them unless Russia escalates its actions, such as moving its troops across the border into Ukraine, Rhodes said.

The decision to impose targeted sanctions comes as Obama is in in the middle of a week-long trip to Asia. The president landed in Malaysia Saturday for his third stop on the tour.