After Russian President Vladimir Putin deployed armed forces into two breakaway regions of eastern Ukraine, Britain imposed sanctions on Gennady Timchenko and two other billionaires with strong ties to him.

Boris Johnson, the British Prime Minister, said Russia was on the verge of becoming a “pariah state,” and that the world must now prepare for the next stage of Putin’s plan, which he described as the Kremlin preparing the groundwork for a full-scale invasion of Ukraine.

He told parliament that five banks – Rossiya, IS Bank, GenBank, Promsvyazbank, and the Black Sea Bank – as well as three individuals – Timchenko and the Rotenberg brothers Igor and Boris – had been sanctioned.

However, the Conservative prime minister refrained from going after Russia’s largest state banks, cutting off money to Russian businesses, or expelling other notable Russian oligarchs from the UK.

In response to requests for greater action, Johnson said, “It is vitally necessary that we maintain in reserve further powerful penalties… in light of what President Putin may do next.”

Only Promsvyazbank is on the Russian central bank’s list of systemically important credit institutions, out of the five targeted banks.
Sberbank and VTB, Russia’s two largest banks, recovered early losses to trade higher after avoiding British penalties.

Timchenko was a substantial stakeholder in Bank Rossiya, according to the British government, which had a part in the destabilization of Ukraine following Russia’s takeover of Crimea in 2014.

Following the takeover of Crimea, “Bank Rossiya has helped the consolidation of Crimea into the Russian Federation by integrating the financial system,” according to a statement announcing the sanctions.

Timchenko, like the Rotenbergs, is a close ally of Putin, according to Johnson.

Since the dissolution of the Soviet Union in 1991, hundreds of billions of pounds have flooded into London and Britain’s overseas territories from Russia, and London has become the Western city of choice for Russia’s and other former Soviet republics’ super-rich.

Timchenko was a substantial stakeholder in Bank Rossiya, according to the British government, which had a part in the destabilization of Ukraine following Russia’s takeover of Crimea in 2014.

Following the takeover of Crimea, “Bank Rossiya has helped the consolidation of Crimea into the Russian Federation by integrating the financial system,” according to a statement announcing the sanctions.

Timchenko, like the Rotenbergs, is a close ally of Putin, according to Johnson.

Since the dissolution of the Soviet Union in 1991, hundreds of billions of pounds have flooded into London and Britain’s overseas territories from Russia, and London has become the Western city of choice for Russia’s and other former Soviet republics’ super-rich.

“We aim to make it impossible for Russian enterprises to raise finance in sterling or dollars,” Johnson stated.

Putin’s circle

Despite Johnson’s warning that further sanctions would be forthcoming, Britain’s first package falls short of what the US did in 2014 and 2018 when it sanctioned Timchenko and the Rotenbergs.

“The danger is that today’s slap on the wrist will have no effect,” warned Liam Byrne of the opposition Labour Party.

“The prime minister needs to understand that withholding our punches with President Putin isn’t going to work.”

Britain would also hinder Russian access to sovereign debt markets and its capacity to process transactions, according to a Western official who spoke on the condition of anonymity.

Bank Rossiya stockholders included members of Putin’s closest circle, according to the US Treasury, and Boris Rotenberg built a fortune under Putin.

Despite Europe’s dependency on Russian energy supply, Johnson praised German Chancellor Olaf Scholz’s move to suspend the Nord Stream 2 pipeline.

According to Johnson’s spokeswoman, he later spoke with French President Emmanuel Macron, and the two agreed that they needed to work together “in lockstep to pursue Russian individuals and entities funding President Putin’s tough approach.”

Iain Duncan Smith, the former leader of the Conservative Party, urged Johnson to go further on sanctions, warning that China would be closely watching the West’s response.