The White House is taking aim at 'financial facilitators' in Russia’s war against Ukraine

President Joe Biden participates in a phone call with Quint leaders Emmanuel Macron of France, Prime Minister Giorgia Meloni of Italy, Chancellor Olaf Scholz of Germany and United Kingdom Prime Minister Rishi Sunak, Monday, October 9, 2023, in the Treaty Room of the White House.

By Nicole Gaudiano

President Joe Biden will sign an executive order today to strengthen U.S. sanction authorities against “financial facilitators” in Russia’s war against Ukraine.

Russia has been seeking ways to get around U.S. sanctions and export controls to obtain items critical to their war and powering their economy — semiconductors, machine tools, chemical precursors, ball bearings and optical systems, two senior administration officials told reporters.

Biden’s executive order is designed to further disrupt support for Russia’s defense industrial base by making it clear that financial institutions need to take action to prevent Russia from getting these goods.

“What we’re trying to do is go after materials that are key to Russia’s ability to build weapons of war,” said one senior administration official. “For them to get those materials, they need to use the financial system, which makes the financial system a potential choke point.”

American or European financial services firms aren’t known to be facilitating these transactions. Many of them don’t do much business in Russia any longer, the official said.

But American and European firms do, however, serve as the correspondent bank for other banks to access the U.S. financial system. Those other banks are doing this type of business in third country jurisdictions, the official said.

“Our overall goal here is to put sand in the gears of Russia's supply chain, which we think is one of the most effective ways to slow Russia down,” the official said.

The officials stressed, however, that the order is one tool in an overall strategy, and that Ukrainians need Congress to provide the resources it requires to defend themselves.

The White House announced this week that the U.S. will send out one more aid package to Ukraine before the allotted funds are likely to run out.

An emergency funding bill with aid for Ukraine, Israel and the Indo-Pacific has been held up by disagreements over U.S. border policies.

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Biden to Sign Order Targeting Support For Russia’s Defense Industrial Base