Sputnik news agency in Latin America takes a hit as sanctions against Russia bite

By Juan Camilo Escorcia

A view shows the main newsroom of Sputnik News, part of the state-run media group Russia Today, in Moscow. [Mladen Antonov/AFP]

A view shows the main newsroom of Sputnik News, part of the state-run media group Russia Today, in Moscow. [Mladen Antonov/AFP]

Sputnik, the Russian news agency, has closed its Rio de Janeiro office from the impact of the 10th package of sanctions against Russia, approved by the European Union (EU) at the end of February.

The 10th package was imposed one year after Russia's invasion of Ukraine.

"Today I signed the termination of my contract with Sputnik Brazil due to the 10th package of sanctions from the European Union, which this time included the agency and led the Río branch to close its doors," journalist and ex-Sputnik employee Marina Lang revealed on Twitter (@marinalang) on March 13.

According to Lang, "Twenty people from this office have been fired" following the sanctions, but she noted "the agency still exists, as it has branches in other regions of the world. Sputnik will continue to produce content in Brazilian Portuguese despite the office closure."

Sputnik has not commented on the subject in any of its news items or on its social media.

In March 2022, as part of the first package of sanctions stemming from the February 2022 invasion, the EU prohibited broadcasts by the news outlets Russia Today (RT) and Sputnik News in the EU. It imposed the ban because of systematic disinformation about the war, which both Russian state media outlets insist on calling a "special military operation."

Despite that ban on RT and Sputnik in the EU, their operations in Latin America remained relatively unaffected at the time. However, US legislators and authorities raised concerns about the reach of RT en Español and of Sputnik Mundo in the region.

"We are deeply concerned by reports that the operations and reach of these news outlets have only increased amid [Russian President Vladimir] Putin's actions in Ukraine," said a letter sent to Twitter last July and signed by US Senate Foreign Relations Committee Chairman Robert Menéndez and senators Bill Cassidy and Tim Kaine.

Latin America has an estimated 30 million followers of such Russian sites.

Direct effects

After eight months of concerns raised by US lawmakers and authorities, the situation regarding Russian news outlets in Latin America has changed. The 10th package of sanctions against Russia, enacted to mark the one-year anniversary of Putin's war in Ukraine, appears to have had a substantial impact on Sputnik.

The new package bans 47 electronic components used in Moscow's weapon systems; sanctions seven Iranian companies linked to Iran's Islamic Revolutionary Guard Corps, which manufactures drones used by Russian forces against Ukraine; and adds 121 Russian individuals and companies to the sanction list, which already includes over 1,500 people.

Sputnik News has had its Latin American editorial office in Montevideo, Uruguay, since mid-2015. The office coordinates radio broadcasts, manages the Sputnik Mundo website and produces news for local media and affiliates throughout the region.

According to correspondents and former workers of Sputnik in Latin America, who prefer to stay anonymous, the Russian news agency employs one to two freelance journalists per country for its news agency.

These journalists are paid $1,500-$2,500 per month through outsourcing contracts governed by Russian regulations.

"That's how Sputnik works in various countries in Latin America. It has no registered offices or legal status, thus avoiding having to pay local taxes. Plus, it prefers to hire local journalists as freelancers instead of employing them as staff, saving a lot of money in terms of medical and other benefits," an ex-Sputnik journalist said.

He added, "Thus, in the eyes of local banks and authorities, these freelancers' monthly pay looks more like an international remittance than a salary."

Late payments

Correspondents for Sputnik in Ecuador, Peru, Bolivia and Brazil have resigned from the agency in recent months because of payment delays, among other reasons, said sources. Freelancers working for Sputnik have reportedly experienced payment issues for some time, which have worsened since the invasion of Ukraine.

"A late payment is something that used to happen sometimes, once or twice a year, but since the packages of sanctions were imposed, it has happened repeatedly. Payments now take two to three months to arrive," stated a journalist who is still affiliated with the media agency.

Sputnik, which is owned by the Russian state media group Rossiya Segodnya (also owner of RT), uses Sberbank to send money from Moscow every month to pay its Latin American correspondents. Sberbank, Russia's oldest and largest bank, is mainly (60.25%) owned by the Russian Central Bank.

However, EU restrictions on transactions with Sberbank since 2014, along with some of its board members being designated by the US Treasury Department Office of Foreign Assets Control (OFAC) for money laundering, may have caused payment delays for Sputnik freelancers in Latin America even before Putin's war on Ukraine.

The EU imposed those long-ago restrictions after Putin's first military attacks on eastern Ukraine.

But a US ban on American banks acting as correspondent banks for Sberbank since February 2022, when Putin launched his full-scale invasion of his neighbour, seems to be the main reason for the several delays of payment to Sputnik freelancers in Latin America. That ban happened around when eight other members of Sberbank's Board of Directors were designated by the OFAC, leading to further complications in payment processes.

"We know that the payments are sent directly from Moscow through Sberbank to the regional Sputnik office in Montevideo, and from there, the money is transferred to the bank accounts of the region's freelancers, and we receive them as international transfers," said another local reporter linked to Sputnik.

Sputnik executives did not "give much information or clarity to Latin American journalists" about payment delays or fund movements even prior to the sanctions, he said. Despite these issues, some correspondents continue working with the agency because of limited job opportunities in this region, even if doing so requires writing articles defensive of Putin's war.

"I resigned from Sputnik because I don't share the position of the editors in Moscow and Montevideo on calling the invasion of Ukraine a 'special military operation' and because they use the agency as a propaganda machine. However, not everyone has the luxury of being able to resign these days, so some correspondents still work there, despite not sharing the agency’s party line or ideology," an ex-Sputnik correspondent told Caravanserai, also speaking on the condition of anonymity.

Caravanserai learned that Sputnik journalists and ex-freelancers in Latin America are prohibited from disclosing the company's internal affairs to other media companies for up to three years after the end of their contract, per number 9 (Confidentiality), paragraphs 9.7 and 9.9. Thus, some dare to speak only under the condition of secrecy.

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