The U.S. Treasury has announced sanctions against Russia’s Gazprombank, a lending institution inexorably linked with Russia’s state-owned gas giant Gazprom, along with fifty other small and medium-sized banks and forty securities registrars. Treasury’s Office of Foreign Assets Control (OFAC) also issued a warning of sanctions risks for financial institutions joining Russia’s System for Transfer of Financial Messages, which Moscow stood up in an attempt to work around having been excluded from the Society for Worldwide Interbank Financial Communication (SWIFT), the main global network to wire funds.

In announcing this latest round of sanctions, the Treasury made it clear that corresponding banks doing business with any of the sanctioned Russian entities are on notice that they may be subject to sanctions themselves if they continue.

Experts in the field consider this a potential coup de grâce. Dr. Vladislav Inozemtsev, co-founder and senior fellow at the Center for Analysis and Strategies in Europe in Nicosia, Cyprus, said, “This is a long-awaited measure that may dramatically change the Russian financial architecture. It makes the Western sanctions against the Russian banking system almost as universal as the sanctions against Russian air companies—but, sadly enough, it does almost three years after the start of the Russian aggression against Ukraine. As I hear from my Russian sources, it seems to be the most important blow to the Russian ability to sustain its economy since the European oil embargo that entered into force in January 2023.”

Certainly, tightening and expanding these sanctions is a move in the right direction. The intent is to restrict Russia’s access to the international financial system and limit the flow of funds to Russia’s war machine. Unfortunately, the time for these measures was at the beginning of the massive Russian invasion of Ukraine in February 2022. Imposing them now, during Biden’s “lame duck” period, is, unfortunately, the latest example of the administration taking steps that are too little, too late— steps that don’t go far enough.

Though the wave of sanctions levied against Russia shortly after its invasion of Ukraine in 2022 somewhat hindered Russian economic growth and interfered with consumer prosperity, they failed to prevent the industrial mobilization of the Russian war economy. Most 2022 sanctions were broadly aimed at state-owned enterprises or privately owned businesses run by Russian oligarchs who supported Putin’s regime. By targeting these entities, Western powers hoped that support for Putin would waver, and the regime would collapse in the face of economic pressure. This has not happened, at least not yet.

Western officials, often with insufficient knowledge of the Russian economy, formulated the strategy to isolate the Russian government from its people and prevent Moscow and its partners from forming effective parallel international financial institutions. However, Putin’s grasp on power has remained firm, and the Russian economy has been kept afloat with the injection of trillions of rubles of wartime procurement money. Russian unemployment is at an historic low of 2.4 percent while China and, to a lesser extent, India have been gorging themselves on cheap Russian commodities.

As the sanctions imposed in 2022 gradually escalated and expanded, Russian isolation from the West became more entrenched, making each set of sanctions progressively less impactful. The measures imposed to date not only failed to prevent a Sino-Russian economic realignment but also gave Russia time to adapt. Concurrent with the decoupling from Western business partners, there was a massive increase in cooperation with Chinese banks and other businesses through which Russian trade could percolate into the open market, albeit at a substantial discount for intermediaries in Beijing.

Unless sanctions are universally enforced, they only limit trade rather than entirely preventing it. Many nations in Russia’s vicinity have resisted pressure to sanction their much larger and more powerful neighbor. At the same time, China welcomed the sanctions as an opportunity to secure favorable deals. Chinese business exploded as local firms rushed to set up money-laundering schemes and other methods through which they could facilitate Russian trade.

The US and, to a greater extent, the West as a whole, poorly coordinated and implemented the sanctions regimes. Timing is everything. Some sanctions were announced only after months of lengthy deliberations, giving Russia ample time to adjust. Others, like the latest round of sanctions imposed by the U.S. Treasury were timed so that any potential effectiveness may have already been lost.

Had the set of sanctions just applied so late in 2024 been declared closer to the start of the war and in coordination with other capitals, they would have been far more effective. Russia and China’s ability to devise new strategies to cope with sanctions regimes was displayed in the latest in Kazan, Tatarstan, Russia. The assembled nations, led by Russia and China, began drawing up plans for a new international payment method. This was billed as an effort to offset the dominance of the US dollar. However, it also functions as a system that allows Russian businesses to conduct operations with less international hindrance and scrutiny.

The US and its allies need to focus on targeting intermediaries to make sanctions more effective. Russia can only continue to flout international sanctions and embargoes as long as it continues to possess other trading partners the West is incapable of detaching itself from. These include businesses in Armenia, Georgia, Qatar, Türkiye, Central Asia, Africa, and Latin America.

Businesses, banks, and officials laundering money for sanctioned Russian entities should be directly targeted. Large Chinese banks tightened transactions with Russia in response to sanctions pressures, but at the same time numerous Chinese cut-outs and smaller banks became involved in creating ways to end-run them.

To make sanctions stick, Chinese businesses trading with Russia should be targeted. Entities in India and Iran that trade energy resources and raw materials and supply components and whole weapons systems to Russia should also be targeted. Sanctions become a deterrent when they force Russian partners to reconsider the pros and cons of aiding Moscow, perhaps netting them a tidy profit in the short term but cutting them off from Western markets in the long term.

Going forward, the U.S. and West’s policy needs to move on two tracks simultaneously: a significant and speedy increase in the weapons supplied to Ukraine beyond the ATACMs to help assure that Ukraine clearly defeats Russia militarily and a concerted, coordinated, and thorough effort to hit Russia where it hurts: in the pocket.