A provision in the new U.S. sanctions legislation signed on August 2 has triggered widespread alarm in Moscow. This law enables President Donald Trump to identify oligarchs on close terms with Vladimir Putin by February 2018 and serve them visa bans and asset freezes in retribution for Kremlin election meddling.

Unsurprisingly, the law was signed only reluctantly signed by Trump, who benefited from the meddling. While Trump was unable to veto the law after it passed through Congress with a sufficiently wide margin, Trump has critiqued the bill, and his administration has shown signs of stalling.

America's new law enables Congress to check Trump's attempts to diminish penalties on Russia. It also increases the chances that purchases of sovereign Russian debt by American investors will be outlawed. Banning such bonds may be highly injurious to Russia's finances, making it nearly impossible for Trump to attain his goal of improving U.S.-Russian relations. Furthermore, U.S.-Russian relations have only grown more strained after his victory, given the multiple investigations into election collusion in Washington, D.C.

© UN Photo/Cia Pak

Entry qualifications for the blacklist include closeness to the Russian regime as well as a net worth provision. Evidence of corruption and an inventory of foreign assets are also desired for the government's reports.

Russia's political system - considered an authoritarian kleptocracy in some corners - increases the leverage that American sanctions hold against Putin's regime. As the loyalty of the Russian elite depends on the protection that Putin affords them, these sanctions drive a wedge in between the elites and their protector. Sanctions in place, oligarchs might no longer be able to easily enjoy their wealth and numerous assets, nor their highly coveted international privileges, such as property rights.

Being labeled as an oligarch will not entail the kind of penalties imposed on Russian insiders and state companies for their involvement with the election and Ukraine. But it will damage the commercial prospects of a large number of Russians. Should billionaires with political clout suffer blacklisting, their American lawyers and lobbyists can do nothing in their defense. An increased fear of the blacklist is rising amongst the major Russian clients of American lawyers, as the list is poised to endanger the oligarchs, their family members, and their business partners in the West.

In spite of the widespread fear caused by the sanctions, some experts maintain that nothing the West does is likely to affect the outcome of Putin's actions. It is the oligarchs close to Putin, rather than Putin himself, who will suffer a great cost to their personal and professional lives. It remains to be seen whether these sanctions will cause enough difficulties for Putin's supporters to succeed in swaying his course of action.