TEST OF WORKING WITH ALLIES
The response could be an early test of the president-elect's promise to cooperate and consult more effectively with U.S. allies, as some proposals likely to be put before Biden could hit the financial interests or infrastructure of countries friendly to the United States, a person familiar with the matter said.
"Symbolic won't do it" for any U.S. response, said James Andrew Lewis, a cyber security expert at the Center for Strategic and International Studies, a Washington think tank. "You want the Russians to know we're pushing back"
A spokeswoman for Biden's transition team did not respond to a request for comment.
The massive data breach, first reported by Reuters, enabled hackers believed to be from Russia's SVR foreign intelligence service to explore the networks of government agencies, private companies and think-tanks for months.
Moscow has denied involvement.
One potential target for U.S. Treasury financial sanctions would be the SVR, said Edward Fishman, an Atlantic Council fellow who worked on Russia sanctions at the State Department during the Obama administration.
"I would think, at the bare minimum, imposing sanctions against the SVR would be something that the U.S. government should consider," Fishman said, noting that the move would be largely symbolic and not have a major economic impact. The U.S. Treasury has already imposed financial sanctions on other Russian security services, the FSB and the GRU.
Financial sanctions against Russian state companies and the business empires of Russian oligarchs linked to Russian President Vladimir Putin may be more effective, as they would deny access to dollar transactions, both Fishman and Lewis said.
Those targets could include aluminum giant Rusal, which saw U.S. sanctions lifted in 2018 after blacklisted Russian billionaire Oleg Deripaska reduced his stake to a minority in a deal with the Treasury.
Lewis said a stronger option could be to cut Russia off from the SWIFT international bank transfer and financial messaging system, a crippling move that would prevent Russian companies from processing payments to and from foreign customers.
Such a move was contemplated in 2014 when Russia annexed Ukraine's Crimean peninsula, but it would hurt the Russian energy sector, complicating gas sales to Europe and hit European companies with Russian operations.
Neither the Treasury nor State Department responded to questions about possible actions in response to the hacking.
The Pentagon's U.S. Cyber Command likely has options for counter actions that could cripple Russian technology infrastructure, such as disrupting phone networks or denial of internet actions, Lewis said, adding that this too could hurt European allies.
"They'll need to think through the diplomacy of that," Lewis said.
The hackers likely left behind some malicious code that would let them access U.S. systems for retaliation against any U.S. cyber attack and it will take months to find and eliminate those "Easter eggs," he added.
