US Homeland Security starts search on Russian 'shiny toys' under Ukraine-related sanctions

According to a Bloomberg report, agents of the US Department of Homeland Security has been ordered to begin with their search and seizure of luxury items in the US that belonged to Russians who are facing sanctions in relation to the Ukraine crisis. John Tobon, who currently heads the financial investigations division of the federal agency in Miami, said that the assets like planes, yachts, mansions and other "shiny toys" are being searched behind layers of shell companies designed to hide them aside from the sanctioned Russians' bank accounts and investments.

So far, the US government has reportedly blacklisted 19 entities and 45 political and business individuals who had been assumed to have links to Russian President Vladimir Putin and his inner circle in order to pressure Russia off Ukraine.

Tobon said that once agents find the target assets, they will be frozen by the US Treasury Department. He also mentioned that the concerted effort involves several branches of the US government, along with Homeland Security's Foreign Corruption Investigations Group agents, forensic accountants and intelligence analysts.

"This is the equivalent of the U.S. Treasury throwing up a bat signal -- it's all hands on deck and here is your mission. The challenge comes to trying to find an asset that somebody is deliberately trying to hide," Tobon added.

Chief emerging market economist Neil Shearing for Capital Economics Ltd in London said about the latest measure, "(Freezing the assets could) translate quickly into political pressure (on Putin). Russian oligarchs made money in Russia and enjoyed the fruits of that money in the West. If you squeeze that, then it will create some kind of pain."

Kremlin spokesman Dmitry Peskov commented about the US investigation and said, "Nobody informed us, but I don't find these efforts surprising at all."

On the other hand, Russia might have seen the US effort coming. Last year, the country adopted a law that prohibits its government officials and state-owned company executives from holding financial instruments overseas. Should anyone will be allowed to own one, one would have to declare it and explain where the money used to acquire the asset came from. According to data from the central bank, a net amount of $51 billion of Russian capital outflow has been posted in the first quarter alone.

Tags

US Department of Homeland Security, Russian President Vladimir Putin, US Treasury Department, Russian assets freeze, Ukraine crisis

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