World News

Russia Says US Bank Blocking Embassy Money Transfer as Sanctions Take Hold

Russia has accused U.S. banking giant J. P. Morgan of illegally blocking a cash transfer from one of its embassies to a vendor.

The Russian Foreign Ministry, in a statement Tuesday, linked the transfer blockage to U.S. sanctions slapped on Moscow for its occupation and annexation of Ukraine's Crimean peninsula. The Russian statement referred to the annexation as a "reunification."

The U.S. sanctions, announced by President Barack Obama last month, were approved Tuesday by U.S. lawmakers, along with $1 billion in loan guarantees to the Kyiv government.

The Russian ministry said the transfer blockage prevented its embassy in Kazakhstan from making an insurance payment to a Russian company. It called the bank's move "unacceptable, illegal and absurd," and said the White House had "clearly overplayed its hand." It also warned the blockage will "have consequences" for the U.S. embassy in Russia.

There was no immediate comment from U.S. officials or J. P. Morgan.



Meanwhile, the Russian energy monopoly Gazprom, which supplies much of Ukraine's natural gas needs, announced a 40 percent increase in the price of gas sold to its impoverished neighbor.

European consumers receive about one-quarter of their gas needs from Gazprom, with most of those supplies delivered through Soviet-era pipelines running through Ukraine to the West.

In Brussels, NATO ordered an official end to civilian and military cooperation with Russia. In a joint statement, ministers in the 28-nation military alliance reiterated that they do not recognize the annexation, and urged Moscow to take "immediate" steps to comply with international law.

NATO Secretary-General Anders Fogh Rasmussen left the door open for future diplomatic discussions that could lead to an easing or resolution of the standoff.

The NATO moves strengthen and codify alliance warnings issued in the wake of Russia's Crimea seizure. While no specific details were released, analysts say the moves could include expanding air patrols over Baltic nations bordering Russia, and an increased NATO naval presence in the Baltic Sea.

Also Tuesday, Ukraine's parliament voted to disarm unofficial paramilitary ultra-nationalist groups that analysts say played a major role in the February overthrow of Ukraine's pro-Russian president Viktor Yanukovych.

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