To Escalate Russian Sanctions, Senator King Introduces Bipartisan Bill to Freeze Nation's Gold Reserves

Press Release

U.S. Senators Angus King (I-Maine), John Cornyn (R-Texas), Bill Hagerty (R-Tenn.), and Maggie Hassan (D-N.H) today introduced the Stop Russian Government and Oligarchs from Limiting Democracy (Stop Russian GOLD) Act, which would strengthen Russian sanctions by targeting their ability to sell gold reserves. The bipartisan bill would apply secondary sanctions to any American entities knowingly transacting with or transporting gold from Russia's central bank holdings or selling gold physically or electronically in Russia, and would create guidance to help Americans avoid these sanctions.

"The free world's sanctions are devastating Russia's economy -- and as long as Putin continues his unprovoked and horrific invasion of Ukraine, we must keep up the pressure," said Senator King. "Russia's massive gold supply is one of the few remaining assets that Putin can use to keep his country's economy from falling even further. By sanctioning these reserves, we can further isolate Russia from the world's economy and increase the difficulty of Putin's increasingly-costly military campaign. We urge the speedy passage of these bipartisan sanctions to hold Putin accountable for his crimes."

"Russia has taken a page out of Venezuela's book by exploiting a loophole in current sanctions that allows them to launder money through the purchase and sale of gold," said Senator Cornyn. "This legislation would apply secondary sanctions to parties who help Russia finance their war by buying or selling this blood gold."

"Because Russia is intent on using any loophole it can find to get around the economic sanctions of the United States and our allies, Congress must make it harder for Putin to liquidate Russia's gold and use those proceeds to fund its invasion of Ukraine," said Senator Hagerty. "These bipartisan secondary sanctions on Russia's gold transactions will build on the Biden Administration's recent Russia sanctions and further choke off Russia's economy from capital."

"With Russia's economy in freefall, we need to make sure that Putin can't circumvent our sanctions," said Senator Hassan. "This bipartisan bill closes a critical loophole that would allow Russia to sell off its gold reserves to prop up the Russia economy. The U.S. and our allies must be steadfast in standing up to Russian aggression and ensure that we block any escape hatch Putin has in getting around the full weight of our sanctions."

Russia holds $130 billion in gold reserves in the country, and the nation is currently exploiting a loophole in the sanctions placed on its central bank that allows the government and oligarchs to launder money through gold. The Russian Federation is purchasing gold to offset the devaluation of its currency, the ruble, and is then selling that gold on international markets in exchange for high-value currency. The secondary sanctions in this legislation would deter the purchase of Russian gold and close this loophole that allows the Russian Federation to soften the financial impact of sanctions.

A member of the Senate Armed Services Committee and the Senate Select Committee on Intelligence, Senator King is recognized as a thoughtful voice on national security and foreign policy issues in the Senate -- he condemned the attacks on Ukrainian sovereignty as "heinous", and has worked to provide support for the Ukrainian people, while ensuring that Russia feels the full impact of U.S. sanctions. Last week, he successfully called for Ukraine to receive a TPS designation, and introduced legislation to prohibit the importation of Russian crude oil, petroleum, petroleum products, liquefied natural gas (LNG) and coal. Senator King has also urged maximum intelligence sharing with Ukrainian officials, and cosponsored a bipartisan resolution supporting the American partner in the face of Russian aggression.