The U.S. Treasury Department ("Treasury") Office of Foreign Assets Control ("OFAC") designated several Russian individuals and entities for working at the direction of or providing support to Russia's Federal Security Service (the "FSB"). OFAC previously designated the FSB itself for engaging in "malign and destabilizing" cyber activities pursuant to the Countering America's Adversaries Through Sanctions Act on March 15, 2018, and pursuant to Executive Order 13694 on December 28, 2016.
As a result of OFAC's action, all property and interests in property subject to U.S. jurisdiction of the five sanctioned entities and three sanctioned individuals are blocked, and U.S. persons are generally prohibited from engaging in transactions with them. OFAC stated that the designated individuals and entities (i) are owned or controlled by, or acting for or on behalf of, the FSB or other entities that have enabled FSB activities; and/or (ii) have provided the FSB with material and technological support.
According to Treasury Secretary Stephen T. Mnuchin, the sanctioned entities "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." Specific examples of Russia's "malign and destabilizing" activities cited in OFAC's press release include (i) cyberattacks, including cyber intrusions against the U.S. energy grid to potentially enable future offensive operations, (ii) global compromises of network infrastructure devices, including routers and switches, and (iii) the tracking of undersea communication cables that carry much of the world's telecommunications data.
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