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9 Sep, 2022 18:58

Russian tycoon offers $1 billion to Ukraine – WSJ

Mikhail Fridman has reportedly proposed using his frozen assets to help the Ukrainian economy
Russian tycoon offers $1 billion to Ukraine – WSJ

Russian Alfa Bank co-founder Mikhail Fridman has offered to transfer $1 billion of his personal wealth, currently frozen under UK sanctions, to its Ukrainian subsidiary in order to help rebuild the country, according to the Wall Street Journal. Sources told the newspaper on Wednesday that the move was aimed at persuading London to drop the sanctions.

The bank would like, as one of the biggest private banks in Ukraine … to be an active player in recovering the Ukrainian economy after the war,” the supervisory board chair of the Alfa branch in Ukraine, Roman Shpek, told the outlet, explaining the funds could be used to help Kiev rebuild in areas like infrastructure, healthcare, and food and energy security. 

The company initially proposed the transfer in June to the National Bank of Ukraine, whose approval would be required before the matter could pass to the EU. Brussels would ultimately be responsible for allowing the funds to leave Europe, and Alfa’s Ukrainian subsidiary petitioned the Council of Europe on Fridman’s behalf last week. 

Fridman, who was born in the Soviet city of Lviv in western Ukraine, resigned as a director of Alfa’s parent company in March, days after the EU and UK sanctions came down. While he has not been personally sanctioned by the US, Alfa Bank is blacklisted by the Treasury Department, meaning other companies must cut ties with it or risk being sanctioned themselves, and UK entities have distanced themselves from him due to the personal sanctions there.

Unnamed individuals familiar with the matter told the WSJ that Alfa’s proposal was an effort to convince London to lift the sanctions on Fridman’s assets, though he has denied making any such “quid pro quo” offer. The British Foreign Office responded that the UK “does not condone any sanctions avoidance.” Shpek insisted the donation was “a really important economic project,” stressing that the prospect of future sanctions relief had nothing to do with it.