could be frozen.[1]Furthermore, the existence of sanctions is no guarantee of their implementation and enforcement: a point we have made in previous reports.[2] The Sentry called for the UK to ensure the effectiveness of its sanctions:
The UK must deploy a cross-government approach, including the NCA, FCDO, and HM Treasury, to effectively implement these sanctions and ensure that they have the maximum impact and lead to the actual seizure of UK based assets, travel bans, and the denial of services. This must be coupled with effective in-country and international messaging that clearly sets out the reason for and aim of the sanctions.[3]
50. There is concern that the financial benefits of the Wagner Network’s activities may be reaching the Russian government. Professor Blazakis told us last November that the Wagner Network had “become instrumental in Putin’s ambitions in gaining access to natural resources throughout Africa”, adding: “whether gold, oil or diamonds, the Russian Federation has acquired fungible assets that keep the war machine churning in Ukraine”.[4] It is also unclear whether the Government has assessed the likelihood that Wagner Network activities have helped Russia to evade sanctions:[5]The Minister was “sure that the Department is tracking that”, but said that he had no “particular knowledge” of such activity.[6]
51. On 23 January 2023, it was reported that HM Treasury—specifically, the Office of Financial Sanctions Implementation (OFSI)—had granted special licenses to Yevgeny Prigozhin to enable him to circumvent UK sanctions against him and to launch a legal campaign against Eliot Higgins, founder of Bellingcat.[7] The aim of this case appears to have been to rebut allegations made by Bellingcat against Prigozhin, which played a role in his original sanctions designation. The Treasury approved a British firm, Discreet Law, to work on this case, and enabled Prigozhin to pay the fees. Responding to an Urgent Question on 25 January 2023, Treasury Minister James Cartlidge MP noted that such decisions are routinely taken by officials in OFSI, without ministerial oversight.[8] He noted that, under the UK’s sanctions regime, there can be circumstances when frozen assets are used to pay for sanctioned individuals’ legal fees, due to the universal right to legal representation. On 30 March 2023, the Treasury Minister, Baroness Penn, announced that, when assessing future applications for sanctions waivers, OFSI takes “a presumption that legal fees relating to defamation and similar cases will be rejected”.[9] She also noted that updates to the decision-making framework would clarify “when it is appropriate for Ministers to take these decisions personally, or where officials can take these decisions”.
52. The FCDO’s direct involvement in Treasury decisions over sanctions waivers appears limited. The Foreign Office had no involvement, for example, in OFSI’s decision over
- ↑ Qq155–156 [Leo Docherty
- ↑ Foreign Affairs Committee, Second Report of Session 2022–23, The cost of complacency: illicit finance and the war in Ukraine HC 168, paras 29–30. See, for example, Three Russians under sanctions own UK property via overseas entities, The Guardian, 31 January 2023
- ↑ The Sentry (WGN0017) para 27
- ↑ Q67
- ↑ Q161 [Leo Docherty]
- ↑ Q162 [Leo Docherty]
- ↑ How Rishi Sunak’s Treasury helped Putin ally sue Bellingcat’s Eliot Higgins, openDemocracy, 23 January 202
- ↑ HC Deb, 25 January 2023, col 1013 [Commons Chamber]
- ↑ Statement UIN HLWS686 by Baroness Penn [on Office of Financial Sanctions Implementation update], 30 March 2023
