MICHEL MARTIN, HOST:

We're going to talk more now about the efforts the U.S. and its allies are making to pressure and isolate the Russian president, his inner circle and the Russian economy. Later, we're going to tell you more about the decision to take a number of Russian banks off the SWIFT system. That's the network that allows for global financial transactions. But what about the enormous Russian assets parked outside of Russia? A 2017 paper from the National Bureau of Economic Research, an independent nonprofit research group, puts Russian offshore wealth at some $800 billion, tied up in luxury real estate and other investments. And that got us wondering about how sanctions might affect these assets and whether that could really send a persuasive message to Putin and his powerful inner circle.

For that, we called Julia Friedlander, a senior fellow at the Atlantic Council and director of their Economic Statecraft Initiative. She has a deep background in the relationship between economic and financial policies and national security through previous stints at the CIA, the National Security Council and the Treasury Department. And she's with us now. Julia Friedlander, thanks so much for joining us.

JULIA FRIEDLANDER: Thanks so much for having me. It's a pleasure.

MARTIN: I just want to take a step back for a minute because people may have heard about sanctions in the past. The U.S. and other countries have used them against governments that they deem hostile for years, like Iran, North Korea and even Russia. As briefly as you can, could you just describe how they work?

FRIEDLANDER: Sure. Well, when the U.S. government sanctions individuals, it means that any - or an entity, for that matter - all U.S. assets are frozen of that individual. And that accounts for all U.S. persons, so that's not even those who hold assets in the U.S., but those who have connections to the U.S. abroad. And that includes U.S. multinationals. And most international financial institutions and corporations will also abide by U.S. sanctions because of the connections they have to the U.S. dollar and to the New York Financial System.

MARTIN: So you can imagine where some people might say, well, you know, not all Russians know each other and not all Americans know each other, so just because somebody is rich and has investments in the United States doesn't mean that they're looped in with the Russian president. But what about that? I mean, what do we know about the connections between very wealthy Russians and the Russian president? Is it just understood that there has to be a connection because of the way wealth is generated in Russia? And, frankly, has this been a concern of the government prior to this invasion?

FRIEDLANDER: Sure. It has been a concern of the U.S. government for a while. But I'll tell you that it's hard to make that distinction, and you're actually asking the right question. Is any asset held abroad by a Russian illicit by its very nature of being Russian itself? And I think that it's taken us a while to realize that, as you say, because, you know, if you are going to be holding these assets abroad, your connections to the Kremlin must be pretty strong if you're going to have this much money.

Now, of course, it - again, there are a lot of people who launder money. There are a lot of people who seek to evade taxes. Why are the Russians more dangerous? Why is a - you know, a tax evader in the United States a national security concern to the United States? And I think what we've developed over time is an understanding that these assets are not only - don't only belong to the Russian people, but that these offshore holdings are actually being used to finance some of the adventurism of the Putin regime overseas, the very kind of stuff that we try to stop through foreign policy means, but we're letting it happen anyway because we're letting the money flow through our financial system.

MARTIN: Well, you know, you made the point earlier that some of these - the money can be very hard to find because of, you know, ownership structures. And as - you've given us all the reasons why this can be difficult and also the fact that there's so much sensitivity in the United States around private property, right? Are there any mechanisms that the U.S. has right now to make sure that these assets aren't being used to fund this invasion? Is there anything that can be done now?

FRIEDLANDER: Sure. I mean, again, if you can connect assets to those that we've already sanctioned, to those who are close to Putin, to those who are even close to the Russian regime, we can investigate them as a law enforcement matter. What's important about sanctioning oligarchs and why I said sanction them - it's not only because it's a nice symbolic mechanism that shows, you know, the Russian people that, you know, you're being ripped off, but that you can use that sanction as a sort of triggering mechanism for all of the law enforcement investigative mechanisms that come after that. Sanctions are really sort of the first step because, then, anything that is over 50% owned or controlled by a sanctioned entity or person is also sanctioned and frozen by operation of law.

MARTIN: The concern people often have about sanctions is that the citizens are more damaged than the people who are most responsible for the conduct, that the rich, the powerful, particularly somebody like Putin has many ways to insulate himself from the consequences of his conduct in a way that regular people don't. Are you worried about that?

FRIEDLANDER: This is obviously going to have an impact on the everyday Russian economy, just as sanctions programs, you know, that - you know, what we call maximum pressure sanctions campaigns do around the world. You know, and this is one of the downsides to what we do. And I think that the - we weigh it very carefully against national security priorities and what we think we can and cannot achieve with them. So, you know, I would absolutely watch this space. And I also worry about the long-term impact of having - of collapsing one of the largest economies in the world from a national security perspective, from a global macroeconomic stability perspective. And so that's what - we're going to be seeing how this unfolds in the coming months ahead, what the impacts actually are. But, you know, these decisions were not reached lightly by the U.S. and its partners. And I - you know, I have faith in my former colleagues that they absolutely know what they're doing.

MARTIN: That's Julia Friedlander, senior fellow at the Atlantic Council, where she directs the Economic Statecraft Initiative. She previously has served at the CIA, the NSC and the Treasury Department. Julia Friedlander, thank you so much for joining us.

FRIEDLANDER: Thank you.

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