Tester Introduces Legislation to Ensure Sanctions Hold Putin & Russian Elites Accountable
Digital Asset Sanctions Compliance Enhancement Act would ensure Putin cannot use cryptocurrencies and other digital assets to undermine the international community’s economic sanctions against Russia.
Senate Defense Appropriations Subcommittee Chairman Jon Tester introduced the Digital Asset Sanctions Compliance Enhancement Act to ensure that Vladimir Putin and Russian elites don’t use digital assets to undermine the international community’s economic sanctions against Russia following its invasion of Ukraine.
“Vladimir Putin’s unprovoked war in Ukraine is a threat to democracies everywhere, and if we are going to hold him and his cronies accountable, we have to be sure they aren’t using digital tools to evade sanctions,” said Chairman Tester. “I’m proud to introduce this legislation that will make sure we isolate Putin and sends a message to America’s adversaries that folks who threaten freedom and democracy around the world cannot hide from the consequences of their actions.”
Chairman Tester’s legislation, which is cosponsored by 10 of his colleagues, comes amid bipartisan concerns and warnings by federal agencies that Russian actors may try to evade economic sanctions by using digital currencies. Countries hit hard by sanctions, including North Korea and Iran, have been previously found to use cryptocurrency to curb the effects of economic sanctions.
The Digital Asset Sanctions Compliance Enhancement Act would combat the risk of Russian actors from using digital assets to evade international sanctions by discouraging foreign crypto firms from doing business with sanctioned Russian elites, providing the Administration with authority to suspend transactions with Russia-linked crypto addresses, and increasing transparency around crypto holdings.
Specifically, the Digital Asset Sanctions Compliance Enhancement Act would close potential avenues for evasion of sanctions against Russia by:
- Requiring the President to identify foreign digital asset actors that are facilitating evasion of sanctions against Russia, and authorizing the President to sanction such actors, prohibiting their transactions with U.S. persons and blocking their assets.
- Providing the Treasury Secretary clear authority to prohibit digital asset trading platforms and transaction facilitators under U.S. jurisdiction from transacting with cryptocurrency addresses that are known to be, or could reasonably be known to be, in Russia.
- Directing FinCEN to require U.S. taxpayers engaged in a transaction with a value greater than $10K of cryptocurrency offshore to file FinCEN Form 114 (FBAR).
- Requiring the Treasury Department to report on its progress in implementing these provisions, including any resources needed by the Department to improve implementation and progress in coordinating with foreign partners.
- Requiring the Treasury Department to issue a public report identifying foreign digital asset trading platforms that are determined to be high risk for sanctions evasion, money laundering, or other illicit activities.
Chairman Tester has led the charge to support America’s Ukranian partners and European allies in response to Russia’s unprovoked aggression. He negotiated supplemental funding in the annual government funding package for the Department of Defense to address military requirements arising from the Russian invasion of Ukraine. This measure provides $6.5 billion for the Department of Defense, of which $3.5 billion is to restore military stocks of equipment that has been transferred to the Government of Ukraine, and $3 billion is to address deployment, operational, and intelligence costs for U.S. forces deployed to Europe to deter further aggression. Chairman Tester also successfully pushed the Biden Administration to ban Russian energy imports from the United States.
Chairman Tester took the gavel of the Defense Appropriations Subcommittee in January 2021. The Subcommitee is responsible for providing nearly $700 billion annually to the Department of Defense and related agencies. This is more than 95 percent of the military’s yearly budget, and includes matters ranging from pay and benefits for millions of service members and civilians to the development of advanced technologies and next-generation weapons. The Subcommittee also oversees funding for nearly all major U.S. intelligence agencies.