"Wagner is a criminal organization that is committing widespread atrocities and human rights abuses, and we will work relentlessly to identify, disrupt, expose, and target those assisting Wagner," White House National Security Council spokesman John Kirby said in a briefing.
Kirby said the designation will pave the way for tougher sanctions, and throttle its ability to do business globally.
"These actions recognize the transcontinental threat that Wagner poses, including through its ongoing pattern of serious criminal activity with these actions, and there'll be more to come,'' Kirby said.
Kirby also said that Russian President Vladimir Putin had been turning to Wagner for military support, leading to tensions in Moscow.
"We are seeing indications, including in intelligence, that tensions between Wagner and the Russian Defense Ministry are increasing," he said. "Wagner is becoming a rival power center to the Russian military and other Russian ministries," Kirby pointed out.