Diogo Augusto reports on several domestic companies whose directors are on the UK’s international sanctions list, which have so far eluded authorities
Eleven UK companies with management links to people targeted by government sanctions because of their proximity to the Kremlin were not themselves sanctioned, Signing time found.
After Russia invaded Ukraine last February, countries and international bodies implemented a series of sanctions in an attempt to hit Vladimir Putin and his regime.
Signing time searched for all 1,267 people and 151 entities on the consolidated list of UK financial sanctions targets and found 11 companies that, despite being linked to named individuals, were not sanctioned.
The companies are not accused of wrongdoing, although it is questionable how effective the UK’s sanctions regime is, while companies associated with sanctioned individuals are able to operate seemingly unhindered.
RCIF United Kingdom
The Russia-China Investment Fund (ICIF) was established by a bilateral agreement between the two countries and now includes Saudi Arabia. In an effort to seek out mutual investment opportunities, China’s sovereign wealth fund contributed $1 billion and the Russian Direct Investment Fund (RDIF) – its Russian counterpart – contributed another $1 billion.
The fund is incorporated in China but also controls RCIF UK, a UK entity set up to manage a UK branch of the fund. It was created in 2014 with a registered capital of 3 million dollars, now increased to 20 million dollars.
One of RCIF UK’s four trustees has since 2014 been Kirill Alexandrovich Dmitriev, a Kyiv-born Russian national on Britain’s sanctions list.
According to the document, “As Director General of RDIF, Dmitriev works as a director or equivalent of an entity affiliated with the Russian government, and for a person who carries out activities in a sector of strategic importance for the Russian government. and for a person who performs activities of economic importance to the government of Russia and who, as a result, obtains a benefit from or supports the government of Russia”.
Companies House does not specify an owner for RCIF UK and the fund is not on the sanctions list.
RCIF UK did not respond to our request for comment.
Terra Services Limited (TSL) was incorporated in the UK in 2003 with sole director and owner Pavel Ezubov. TSL is an inactive business and reported in 2021 to have assets of just over £300,000 and no employees.
Ezubov occupies entry number 245 on the UK sanctions list for being an associate of Russian oligarch Oleg Deripaska (entry 205).
Deripaska owned TSL until in January 2018 Ezubov took over.
TSL unsuccessfully sued the National Crime Agency in 2020 after a storage unit was searched and 11 boxes of TSL documents apprehended at the request of the US State Department while investigating the case of the associate of Donald Trump, Paul Manafort.
Under UK rules, TSL should automatically be subject to an asset freeze because it is owned by a named person. However, he was not placed on the sanctions list.
Sberbank of Russia
With a share capital of £1 billion, this currently dormant company incorporated in 2016 has 10 active directors, two of whom are currently on the UK sanctions list.
51% of the company is owned by the Central Bank of the Russian Federation, and the remaining 49% is owned by Sberbank of Russia, the country’s largest public bank. Sberbank itself is the target of financial sanctions. This information is on the company’s incorporation document and all subsequent updates have not signaled a change. Still, a Sberbank spokesman said Signing time: “Sberbank of Russia is not related to the Sberbank group.”
Sberbank director Herman Gref is 316th on the UK sanctions list for serving as CEO and chairman of the board of Sberbank. According to the British government, “Sberbank has been identified as a person involved in obtaining an advantage or support from the Russian government. As managing director and chairman of the board of directors of Sberbank, Gref is associated with a person involved in obtaining a benefit or support from the Russian government, and received a financial benefit from that person”.
Lev Khasis, another director and first vice-president of Sberbank, was put on the list (431) through an emergency procedure after Canada imposed sanctions on him and the United Kingdom l considered in the public interest. It has been reported that Khasis, a US-Russian dual citizen, suddenly fled Russia shortly after the invasion of Ukraine.
Sberbank, not the owners, is not on the UK sanctions list.
Tenenbaum is a Ukrainian-born Canadian national who is on Britain’s sanctions list due to his association with Roman Abramovich, the Russian billionaire who is still listed as the owner of Chelsea Football Club.
Tenenbaum is linked to six different companies which all seem to be in Chelsea FC’s orbit. He is a director of Fordstam Limited, the parent company of the group through which Abramovich’s financing of the club was facilitated. There are then five other companies under the Fordstam Limited umbrella which all list Tenenbaum as a director: Fordstam Developments Limited, Chelsea Digital Ventures Limited, Chelsea FC Holdings Limited, Stamford Bridge Projects Ltd, Chelsea Football Club Limited.
Following the sanctions imposed on Abramovich, he announced his intention to sell the club. However, the process has been a bumpy one, with one problem being the outstanding £1.6 billion debt that Fordstam owes Abramovich.
Roman Abramovich still appears as the ultimate beneficial owner of Fordstam Limited (and Chelsea Digital Ventures Limited) and, while this can be expected to change once the sale is complete, it is not clear whether Tenenbaum will continue as director of these six companies.
All other companies name Fordstam Limited as sole proprietor and none have been placed on the UK sanctions list.
Chelsea FC did not respond to our request for comment.
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Zairova (sanctions list entry 1234) is a director and, since March 2022, owner of Reashon Holding Ltd and Athlone House Limited. Although Zairova has always been the director of both companies, before March they were owned by Mikhail Fridman.
According to the UK sanctioned list, “there are reasonable grounds to suspect that Zairova is acting on behalf of or at the direction of Fridman.”
Mikhail Fridman is himself on the list, at number 264, for being “closely associated with President Vladimir Putin”. He also owns Alfa Bank, Russia’s largest private bank. Alfa did not respond to our request for comment.
Athlone House is the name of the large Victorian house that Fridman bought in 2016 for £65million and the stated nature of Athlone House Limited’s business is: “business of households as employers of staff domestic”.
These companies should automatically be subject to an asset freeze because they are owned by a designated person. However, they were not included in the sanctions list.
A UK Treasury spokesman said Signing time that: “The UK does not designate any entities in their own right that could be exposed to sanctions through their ownership and control structure, as this could change at any time.”
However, an official guide to financial sanctions states, “An asset freeze and certain financial services restrictions will apply to entities…that are owned or controlled, directly or indirectly, by a designated person.”
It adds: “The UK Government will seek to designate wholly owned or controlled entities/individuals where possible.”
While ownership is sometimes easily accessible, control is a fuzzier concept. One of the roles of the Office of Financial Sanctions Implementation (OFSI) is to enforce financial sanctions. However, when asked if it knew whether these companies had or should have their assets frozen or how third parties could know if a company was controlled by a designated person, the Treasury declined to comment.
The Treasury spokesman also said the OFSI was unable to comment on specific companies due to data protection laws, but declined to elaborate on which laws prevented it.
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