State Dept. accuses Putin of 'spinning fiction' as lawmakers mull sanctions

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US, EU step up threats of sanctions against Russia

Any thaw in Ukrainian crisis?

The State Department escalated a war of words Wednesday between the U.S. and Russia over the Ukraine crisis, accusing President Vladimir Putin of lying to justify "illegal actions," as lawmakers threatened "crippling sanctions" against Russia.

Describing Putin's comments the as most "startling Russian fiction" since writer Fyodor Dostoyevsky wrote "The formula 'two plus two equals five' is not without its attractions," the department identified 10 "False Claims about Ukraine."

In its first bullet point, the department said, "Mr. Putin says: Russian forces in Crimea are only acting to protect Russian military assets. It is 'citizens' defense groups,' not Russian forces, who have seized infrastructure and military facilities in Crimea."

"While these units wear uniforms without insignia, they drive vehicles with Russian military license plates and freely identify themselves as Russian security forces when asked by the international media and the Ukrainian military," the State Department document said.

Among the other questionable assertions were those about a humanitarian crisis in Ukraine, the legality of Russian military intervention there and the legitimacy of Ukraine's fugitive president.

Meanwhile, lawmakers in the House and Senate on Wednesday introduced formal resolutions condemning Russia's actions, as Congress and the Obama administration indicated sanctions could be imposed if the situation in Ukraine doesn't improve, The Wall Street Journal reported.

"We must place crippling sanctions on Russian high-ranking officials, state-owned banks and commercial enterprises, and key individuals behind the Russian intervention," said Rep. Ed Royce, R., Calif., chairman of the House Foreign Affairs Committee. The committee will address the resolution Thursday after hearing testimony from State Department and Treasury officials.

House Majority Leader Eric Cantor, R., Va., who is working on draft legislation for a loan guarantee package for Ukraine, said lawmakers need to put more pressure on Russia "to stop the flagrant aggression to its neighbor," according to The Wall Street Journal.

"The world community should stand united against this invasion," Cantor said.

Treasury Secretary Jacob Lew told Congress on Wednesday that the Obama administration is considering various options to hold Russia accountable for intervening in Ukraine, including sanctions and other ways "to increase Russia's political and economic isolation."

In the Senate, Democrats and Republicans are crafting a bill that would impose sanctions on Russian government officials, state-owned banks, and export industries such as petrochemicals, but want to coordinate action with European governments. The bill could be introduced as early as next week.

"Really this comes down to whether Europe is willing to join us," said Sen. Chris Murphy, D-Conn., who heads a Senate subcommittee focused on the region. "Europe is not where they need to be right now. I think they are willing to give Putin a much longer leash than we are."

Russia has suggested that it will meet any sanctions imposed by Western governments with a tough response, and Putin has warned that those measures could incur serious "mutual damage."

The EU on Wednesday also froze the assets of 18 people, including ousted President Viktor Yanukovych, held responsible for misappropriating state funds in Ukraine, echoing similar action in Switzerland and Austria.

The Obama administration, meanwhile, said it was taking steps Wednesday to support the defenses of U.S. allies.

Defense Secretary Chuck Hagel told the Senate Armed Services Committee the U.S. was stepping up joint aviation training with Polish forces and increasing American participation in NATO's air policing mission in ithe Baltics.

The Organization for Security and Cooperation in Europe sent a team of 35 unarmed military observers to Crimea on Wednesday at the fledgling government's request.

The Associated Press contributed to this report.