Obama Targets Putin’s Spies Over DNC Hack
The White House has been saying for weeks that it would punish Russia for interfering in America’s election. Today, it finally hit back.
In his news conference of the year two weeks ago, U.S. President Barack Obama said that he warned Russian President Vladimir Putin to refrain from any further hacking of the U.S. election. In Obama’s words, he told Putin to “cut it out” during a tense tête-à-tête at a summit in China just weeks before the national vote that saw a prominent Putin-flatterer win the White House. Obama intimated that the hacking was also done with Putin’s express permission, if not indeed ordered by him personally. The goal of the digital tradecraft, the CIA and the FBI now agree, was to further the election of Donald Trump.
Whether the former KGB spy accused by the British government of “probably” approving the murderous irradiation of a Russian dissident at a central London hotel was impressed by “cut it out” remains unclear. But intensified sanctions may be a very different matter. And the stage is now set in the United States for a potential showdown between the Republican-controlled Congress and the new Putin-apologist Republican president.
On Thursday, Obama announced that by executive order he has sanctioned nine entities and individuals over the Russian government’s alleged cyber-espionage against the Democratic Party in general and Hillary Clinton’s presidential campaign in particular. He has also given 35 unnamed Russian intelligence operatives 72 hours to leave the United States, and has ordered restricted access to two Russian-government-run compounds, one in Long Island, the other in Maryland.
The Obama administration sanctioned both Russia's domestic and military intelligence services, the FSB and GRU, respectively, on Thursday. The U.S. also targeted four top-ranking officials of the latter organization, including its current chief, Igor Valentinovich Korobov, and three of his subordinates—Sergey Aleksandrovich Gizunov, Igor Olegovich Kostyukov, and Vladimir Stepanovich Alekseyev. None of these men is known to be a frequent or even occasional traveler to the United States, however, and so the punishment is largely symbolic.
Evgeniy Mikhailovich Bogachev and Aleksey Alekseyevich Belan, accused of "activities related to the significant misappropriation of funds or economic resources, trade secrets, personal identifiers, or financial information for private financial gain," were also sanctioned, along with a signals intelligence center based in St. Petersburg, Russia, a digital security firm and the Autonomous Non-commercial Organization Professional Association of Designers of Data Processing Systems, an under-the-radar and verbosely named organization said by U.S. officials to be a training facility for hackers, according to the New York Times.Bogachev and Belan were both already on the FBI's Most Wanted list for hacking predating the DNC penetration. Russian newspaper Komsomolskaya Pravda called Belan the "Most Dangerous Hacker in the World."
The compound in Long Island being shuttered is a 14-acre estate called Norwich House in Upper Brookville. A nearby Russian compound, the mansion Killenworth, was the site of minor Cold War drama. During the early 1980s, the city council of Glen Cove banned Soviet officials banned from using public beaches and tennis courts and argued with the federal government over the loss of property taxes, owing to the compound's ownership by a foreign government. Arkady Shevchenko, at the time the highest-ranking Soviet diplomat to defect to the United States, told Canadian television that Killenworth was a prominent listening station. ''All the top floors of the building are full of sophisticated equipment...to intercept all conversations of anything which is going on," Shevchenko said in 1982. "At least 15 or 17 technicians were working...to do this job.''
***This is not the first executive order Obama has taken against Russia. Early sanctions, passed in the spring of 2014, took aim at Russian power brokers in Putin’s inner circle, including billionaire oligarchs whose fortunes are intertwined with those of the state. Other targets were the presumed architects of the Ukraine Anschluss such as Vladislav Surkov, Russia’s chief ideologist, and Dmitry Rogozin, the head of the nation’s military-industrial complex. As the Ukraine war wore on, Russian state-owned banks, energy and military companies were added to the U.S. Treasury Department’s banned list, as was the then-head of the GRU, Igor Sergun. Sergun died in January 2016.
These measures were “narrowly tailored,” in the words of Juan Zarate, the Treasury Department's former assistant secretary for the Office of Terrorism and Financial Intelligence, to hurt but not collapse Russia’s economy.
The 11th-hour Obama administration retaliation comes amid a growing, if fragile, bipartisan consensus, premised on the findings of all U.S. intelligence services, about Russia’s interference in American democracy.
Former Republican presidential candidate Sen. Lindsey Graham told CNN this week that the U.S. Senate was united in its view that online hackers connected to Russia’s domestic and military intelligence services stole thousands of internal emails from Democratic National Committee (DNC) accounts and also from the personal account of Hillary Clinton’s campaign chief John Podesta.
“I would say that 99 of us believe the Russians did this and we’re going to do something about it,” Graham said.
Paul Ryan, the Speaker of the House, was more tart in his statement, saying, "Russia does not share America’s interests. In fact, it has consistently sought to undermine them, sowing dangerous instability around the world. While today’s action by the administration is overdue, it is an appropriate way to end eight years of failed policy with Russia. And it serves as a prime example of this administration's ineffective foreign policy that has left America weaker in the eyes of the world."
Graham, for his part, has advocated leveling sanctions against Putin personally. The closest the U.S. has come to targeting the Russian president was to name him as an investor in Gunvor, a Swiss commodities trader, in the passage of the first suite of U.S. sanctions against Russia for its invasion and annexation of Crimea in 2014. Gunvor denies the U.S. Treasury Department’s allegation.
Then, a year ago, Adam Szubin, the acting undersecretary for Terrorism and Financial Intelligence, sat for an interview with BBC Panorama and called Putin a kleptocrat. “We've seen him enriching his friends, his close allies and marginalizing those who he doesn't view as friends using state assets,” Szubin said. “Whether that's Russia's energy wealth, whether it's other state contracts, he directs those to whom he believes will serve him and excludes those who don't. To me, that is a picture of corruption.”
The Kremlin has vowed to respond in kind if new sanctions are passed, as it has done in the past by blacklisting U.S. legislators and American prosecutors of Russian nationals accused of arms trafficking and other crimes.
The most notorious retaliation came after Congress passed the Sergei Magnitsky Rule of Law Accountability Act in 2012, named for a framed and murdered Russian tax attorney. The law authorized the U.S. government to implement travel bans and U.S. asset freezes of any officials complicit in that crime and/or found to have committed gross human rights abuses. The Russian parliament responded by penning a law barring Americans from adopting Russian orphans.
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In response to Thursday's actions, Maria Zakharova, the spokesperson of Russia's Ministry of Foreign Affairs, issued a statement posted on the Ministry’s website: “If Washington really does take new hostile steps, they will be answered ... any action against Russian diplomatic missions in the U.S. will immediately bounce back on U.S. diplomats in Russia." She concluded, "Frankly, we are tired about the lies about Russian hackers—it's misinformation by Obama administration aimed at providing an excuse for its own failure.”
Zakharova has previously dismissed the U.S. allegation of Russian hacking by saying that Trump won the presidency because he catered to what she considers the bellwether constituency: "If you want to know what will happen in America, who do you have to talk to? You have to talk to the Jews, naturally.”
She said this on a pro-government television program in mid-November, at one point adopting a stereotypical Jewish accent to describe what her putative sources for this information in Brighton Beach, Brooklyn, relayed to her.
One person who seems to agree with Zakharova, at least on the question of her government’s innocence, is President-elect Donald Trump.
Having dismissed the Russian hacking claims as unfounded and possibly the work of an obese person sitting in a basement, and having denigrated the U.S. spy agencies that he is about to command as unreliable, Trump again waved off the matter from his home in Mar-a-Lago, Florida. Standing next to a flag-flapping and bejeweled Don King, Trump told reporters on Wednesday, “I think we ought to get on with our lives."
Trump also cast doubt on the digital forensics that go into determining the source of a breach. “I think that computers have complicated lives very greatly, the whole you know age of computer has made it where nobody knows exactly what's going on,” he said.
When asked about Lindsey Graham’s suggestion that Putin be personally brought to book on the hacking, Trump replied that he hadn’t spoken to the South Carolina senator but reminded the press that he ran against Graham for the Republican presidential nomination.
Trump has often exonerated the Russian government from bad behavior well documented by Western governments and independent investigators. He said he did not believe that Russian military hardware, operated by Russian soldiers, was responsible for the downing of a civilian airliner over Ukraine in the summer of 2014. He denied that Putin had invaded Ukraine at all and vowed that he would not do so under a Trump administration, while also, contradictorily, claiming that most Crimeans wanted to be citizens of the Russian Federation. Such apologetics have prompted international suspicions about Trump’s financial and political closeness to Moscow.
Since the U.S. election, Putin also has denied having any involvement in cyber espionage efforts to help Trump’s victory along, although his foreign minister, Sergei Lavrov, did once coyly leave open the possibility. In an interview with CNN’s Christiane Amanpour in October, when asked about the hacking accusations, Lavrov responded: “We did not deny this, they did not prove it.”
The stolen Democratic correspondence was distributed to WikiLeaks and DCLeaks.com, an apparent cutout used by Moscow’s spy agencies to scandalize the Democratic front-runner. The Clinton campaign’s coziness with the DNC, at the expense of her primary rival, Sen. Bernie Sanders, led to the resignation of DNC chairwoman Debbie Wasserman Schultz. Podesta’s emails also contained full transcripts of Clinton’s private speeches delivered to major Wall Street audiences, which the Trump campaign alleged undermined her credibility on holding malfeasant bankers to account. Some of the content gave rise to bizarre and ultimately violent conspiracy theories, or “fake news,” pertaining to the Clinton camp.
Trump has previously said that his team would consider lifting all Ukraine-related Russian sanctions. His appointee for secretary of state, Rex Tillerson, has had a personal and professional stake in seeing them lifted and has said publicly in the past that he opposes them.
As the head of Exxon Mobil, he holds around $218 million in unvested company stock, the price of which would surely increase if the oil conglomerate were allowed, under U.S. law, to engage in long-term direct investment in Russia again.
Exxon claims it lost more than $1 billion because of U.S. sanctions. Tillerson brokered a landmark “strategic partnership” between Exxon and Russian oil giant Rosneft in 2011 for the joint exploration of the Kara Sea, in the Russian Arctic.
That deal, which saw Rosneft’s valuation skyrocket by $7 billion in the days following its announcement, has stalled since the Ukraine crisis and the attendant U.S. financial proscriptions on doing business with Russia’s energy sector.
Tillerson appears to have been a close personal friend of both Putin and Rosneft chairman Igor Sechin, who was sanctioned by Treasury in April 2014. Tillerson, it was revealed by the Guardian, is also the director of a Bahamas-registered Russian subsidiary of Exxon called Exxon Neftegas.
In 2013 Putin personally awarded Tillerson Russia’s Order of Friendship, the highest possible decoration for a foreign national.