Sanctions in action: a number of Russian banks will be cut off from SWIFT

The United States, the European Union and the United Kingdom agreed on Saturday, February 26, to block a number of Russian banks from accessing the global financial system SWIFT and to impose “restrictive measures” on the Russian Central Bank in response to Russia’s military operation in Ukraine. The countries jointly announced these measures as a new round of financial sanctions imposed to impose on Russia. The move includes disconnecting major Russian banks from the international banking system SWIFT.

Disconnecting Russia from SWIFT was already discussed in 2014 – the U.S. and the European Union considered this option when Russia annexed Crimea and supported separatist forces in eastern Ukraine. At the time, Russia said that disconnecting it from the SWIFT system would be tantamount to declaring war. The allies shelved the idea, after which they were criticized for reacting too weakly to Russian aggression in 2014. Since then, Russia has tried to develop its own financial transfer system, but without much success.

Disconnecting Russia from SWIFT would also hurt the economies of other countries – including the U.S. and German economies. So far, Russia’s disconnection from the international banking system is partial, allowing the U.S. and Europe to tighten these sanctions later.

In Brussels, European Commission President Ursula von der Leyen said that disconnecting several Russian banks from SWIFT “guarantees the exclusion of these banks from the international financial system, which would damage their operations on a global scale. She also added that “if necessary,” more banks will be disconnected.

Von der Leyen also said that the EU “is committed to taking measures to limit the issuance of so-called ‘golden passports’ – citizenship sales in the EU – that allowed wealthy Russians linked to the Russian government to become citizens of our countries and gain access to our financial systems.”

The leaders of the European Commission, France, Germany, Italy, Great Britain, Canada and the United States, condemn Putin’s choice of military operation, in Ukraine. We support the Ukrainian government and the Ukrainian people in their heroic efforts to resist the Russian invasion. The war unleashed by Russia is an attack on fundamental international norms that have existed since the end of World War II, which we are committed to defending. We will hold Russia accountable and collectively ensure that this war is a strategic failure for Putin.

Biden said he will soon establish a transatlantic task force to “ensure that our sanctions are effectively enforced by identifying and freezing the assets of individuals and companies subject to these sanctions and located in our jurisdiction.”

Sanctions and other financial measures will be applied to “Russian officials and elites close to the Russian government, as well as their families and their associates. Other governments will also be involved in order to “suppress the movement of illicit proceeds and to deny these individuals the ability to hide their assets in jurisdictions around the world.