The Trump administration has provided the Treasury Department with a list of about 210 Russians deemed close enough to Russian President Vladimir Putin to be targets for new sanctions. Putin criticized the list as an "unfriendly act."
US intelligence agencies believe Russia tried to sway the election in favour of Mr Trump and a special counsel is looking into whether anyone from his campaign colluded in the effort. Senior members of Mr Trump's team met Russian officials. Several of these meetings were not initially disclosed.
Ex-national security adviser Michael Flynn lied to the FBI about meeting the Russian ambassador to the US before Mr Trump took office. Flynn has entered a plea deal, prompting speculation that he has incriminating evidence.
The president's son, Donald Jr, met a Russian lawyer during the campaign who had "dirt" on Hillary Clinton, and adviser George Papadopoulos has admitted lying to the FBI about meetings with alleged go-betweens for Russia. The president's son-in-law Jared Kushner is also under scrutiny, and former campaign chairman Paul Manafort has been charged by investigators with money laundering, unrelated to the election.
Since Trump fired the man leading one of the investigations, ex-FBI Director James Comey, there are questions whether the president has obstructed justice. Legal experts differ on this.
To know more about the US Russia relations click: US midterm elections - Russia’s interference
The list which was released on Monday, accomplishes a congressional demand that Washington punish the Kremlin for interference in the 2016 U.S. election. President Trump reluctantly signed the bill in August.
Russia should be guided by the old rule: ‘The dog barks, but the caravan rolls on,’” Putin was quoted as saying.
Alina Polyakova, a fellow at the Brookings Institution, said that because the list includes all the individuals who meet the net worth threshold of $1 billion rather than anyone suspected of corrupt acts, its usefulness is "limited and ambiguous." "As a who’s who in Russia, I’m sure there are a few Russian ‘minigarchs’ who right now feel slighted for not being on the list," she said."
All of us, all 146 million, have been put on some kind of list," Putin said at a meeting with activists of his campaign. He added, "Certainly, this is an unfriendly move, which further exacerbates already-strained Russia-US relations and hurts international relations as a whole."
The long-awaited list, ordered by Congress in response to alleged Russian meddling in the 2016 US presidential campaign, had spooked rich Russians who fear it could make them informally blacklisted in the global financial system.
The US Treasury document itself stresses: "It is not a sanctions list, and the inclusion of individuals or entities... does not and in no way should be interpreted to impose sanctions on those individuals or entities." It adds: "Neither does inclusion on the unclassified list indicate that the US government has information about the individual's involvement in malign activities."
However, there is a classified version said to include information detailing allegations of involvement in corrupt activities.
On August 2, 2017, the President signed into law the “Countering America’s Adversaries Through Sanctions Act. The law limited the amount of money Americans could invest in Russian energy projects and made it more difficult for US companies to do business with Russia. It also imposed sanctions on Iran and North Korea.
In signing the act, Trump attached a statement calling the measure "deeply flawed" and said he could make "far better deals with foreign countries than Congress". Earlier on Monday, the US government argued the Caatsa law had already pushed governments around the world to cancel deals with Russia worth billions, suggesting that more sanctions were not required.
Our assessment is that the announcement might leave a jumbled impression of how Trump plans to approach the Kremlin in his second year in office even as investigators search for evidence of collaboration between his campaign and Russian agents. We believe that the list could help Putin consolidate his support base by polishing his image of a strong leader who stands up to a hostile US.