Mnuchin defends U.S. decision to lift sanctions on Russian firms

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By Patricia Zengerle

WASHINGTON (Reuters) – U.S. Treasury Secretary Steven Mnuchin insisted on Thursday that the Trump administration would keep tight control on Russian companies linked to Russian oligarch Oleg Deripaska, despite last month’s decision to ease restrictions on the firms.

“Treasury will be vigilant in ensuring that En+ and Rusal meet these commitments. If these companies fail to comply with the terms, they will face very real and swift consequences, including the reimposition of sanctions,” Mnuchin said in a statement released before the closed-door briefing.

In one of their first actions since the party took control of the U.S. House of Representatives last week, Democrats summoned Mnuchin to conduct a briefing for the entire chamber on the sanctions decision.

The newly appointed Democratic leaders of seven House committees wrote to Mnuchin earlier this week expressing their concerns, citing their committees’ responsibilities to conduct oversight of Russia’s attempts to interfere in U.S. elections and other “hostile actions.”

The committee chairmen and women also asked that the decision to ease the sanctions be postponed, but there was no indication that the administration would do so.

Treasury announced on Dec. 20 that it would lift sanctions imposed in April on the core businesses of Deripaska, including aluminum giant Rusal, its parent En+ and power firm EuroSibEnergo, watering down the toughest penalties imposed since Moscow’s 2014 annexation of Crimea.

The companies agreed to restructure to reduce Deripaska’s stakes and he personally remains on the sanctions list.

“One of the goals of sanctions is to change behavior, and the proposed delistings of companies that Deripaska will no longer control show that sanctions can result in positive change,” Mnuchin said.

Lawmakers could try to pass a resolution of disapproval of Treasury’s decisions, but its passage would require the approval of both the Democratic-majority House and the Senate, where President Donald Trump’s fellow Republicans hold a majority of the seats and are unlikely to break with his policy.

(Reporting by Patricia Zengerle; additional reporting by Susan Heavey and Tim Ahmann; Editing by James Dalgleish)