Democrats Push to Block Sanctions Relief for Russian Oligarch’s Companies

WASHINGTON — Senate Democrats intend to force a vote this coming week on the Trump administration’s move to lift sanctions against companies controlled by an influential Russian oligarch, intensifying a new line of scrutiny of the administration’s handling of Russia policy.

Senator Chuck Schumer of New York, the minority leader, said on Saturday that the sanctions on the business empire of the oligarch, Oleg V. Deripaska, should remain in place, and that a deal negotiated by the Treasury Department to remove them was “flawed and fails to sufficiently limit” Mr. Deripaska’s “control and influence of these companies.”

Mr. Schumer announced that he intended to use a provision in a 2017 sanctions law to prompt a full Senate vote as soon as Tuesday on a resolution to block the Treasury Department’s deal with Mr. Deripaska’s companies. But to approve the measure, Democrats would need the support of several Republicans, which would require them to split with President Trump on the issue. The Democratic-controlled House would also have to pass it.

Democrats have increasingly seized on the Treasury Department’s decision to grant sanctions relief to Mr. Deripaska’s companies as evidence that Mr. Trump and his administration have been soft on Russia. Mr. Trump has made a series of statements deferential toward the Russian president, Vladimir V. Putin, and the special counsel is examining whether the Trump campaign coordinated with the Kremlin to meddle in the 2016 presidential election.

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The Treasury secretary, Steven Mnuchin, briefed Congress on the administration’s decision to lift sanctions on Mr. Deripaska’s companies. Democrats expressed their dissatisfaction with his response, and requested a delay in lifting the sanctions.CreditErin Schaff for The New York Times

Newly empowered House Democrats called Steven Mnuchin, the Treasury secretary, to defend the move to lift sanctions in a classified briefing on Thursday. Afterward, they expressed their dissatisfaction with his responses and demanded that he delay the lifting of the sanctions to review the decision and “relevant intelligence assessments.”

Mr. Mnuchin suggested that he was open to extending a Jan. 17 deadline for lifting the sanctions to give congressional skeptics more time to review it, but he gave no indication that he was rethinking the underlying decision.

The goal of the sanctions, which were announced by the Treasury Department in April 2018, was to punish the Russian government and key supporters for the interference in the 2016 election, among other hostile acts. Noting Mr. Deripaska’s connections to the Russian government and accusations of links to Russian organized crime, the Treasury Department announced sanctions against the oligarch personally, as well as three of his companies that play a major role in the global aluminum supply: EN+, Rusal and JSC EuroSibEnergo.

But the department delayed the sanctions against Mr. Deripaska’s companies several times amid an aggressive lobbying and legal campaign funded by EN+. It argued that the sanctions could have unintended negative effects on companies in the United States, Europe, Jamaica, Guinea and elsewhere.

In the waning days of the last Congress, the Treasury Department announced that it would lift the sanctions against the companies — but not Mr. Deripaska personally — in exchange for an agreement to reduce his ownership stake and control.

Mr. Deripaska’s holdings include Rusal, which plays a major role in the global aluminum supply.CreditIlya Naymushin/Reuters

Democrats have expressed skepticism that the agreement will accomplish those goals, suggesting that it will merely shift control of the companies to interests closely aligned with Mr. Deripaska and the Russian government, including VTB, a Russian bank that has been put under American sanctions.

The issue has been elevated for Democrats because of Mr. Deripaska’s past business dealings with Paul Manafort, Mr. Trump’s former campaign chairman, which have emerged as a subject of interest in the investigations into Russian meddling.

Though the investigation has not implicated Mr. Deripaska, Mr. Schumer said on Saturday that “given Mr. Deripaska’s potential involvement with Paul Manafort and the fact that the special counsel’s Russia investigation has not yet concluded its work, it’s all the more reason these sanctions must remain in place.”

Complicating Democrats’ push to reverse the decision, several European countries have defended the sanctions relief, echoing Mr. Mnuchin’s argument that the resolution punishes Mr. Deripaska without damaging the economies of the United States and its allies.

The ambassadors for Austria, Britain, France, Germany, Ireland, Italy and Sweden sent a letter this month to Mr. Schumer urging him not to challenge the Treasury Department’s decision. They wrote that “by preventing serious damage to the European aluminum industry, the delisting will help to preserve existing supply chains which would otherwise likely be rerouted to China, further strengthening its global market position in the industry.”

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