From freezing to seizing the assets of Russian oligarchs – an acute issue in the fight against corruption

The economy minister would like to be able to seize the assets of Russian oligarchs in France, which are subject to international sanctions. A statement that was welcomed by Transparency International because it would allow for a more effective fight against corruption, but which is not so easy to implement. According to NGOs, the justice system does not have sufficient funds to investigate these confiscations.

To punish Russia, the international community decided to attack the portfolio. Many Russian oligarchs close to power quickly fell victim to measures to freeze their assets abroad. In France, Economy Minister Bruno Le Maire went even further, declaring in early March that “we’re going to make sure it’s not just an asset freeze, it’s an asset forfeiture.“He announced the creation of a working group dedicated to tracking the assets of the oligarchs in France.

A few weeks later, the Economy Minister told the RTL Grand Jury on radio that the state had already frozen almost 850 million assets, including most real estate (more than 500 million euros), as well as bank accounts and yachts. However, the withdrawal of these goods is not yet discussed, the Ministry of Economy is still working with the Ministry of Justice on the possibility of their implementation.

Legal Consequences

The transition from asset freeze to asset confiscation is indeed important. “This word change has legal implications.“, – recall in Transparency International, an organization that fights corruption. The freeze prevents the use of assets, the sale of goods, etc., without changing ownership. Judicial, with an investigation to determine the origin of goods and justify a criminal offense.

The task force set up by Bersi is only aimed at detecting goods subject to international sanctions against Russia. It is made up of members of Tracfin, the financial fraud intelligence service, the treasury, customs and taxes. They are engaged in identifying disputed assets and informing banking institutions and various intermediaries (notaries, lawyers, etc.) about the sanctions taken against Russian oligarchs.

Tracing is not always easy, as these assets tend to be hidden through shell companies and housed in tax havens. And the national authorities still don’t have the tools to track them down. European law, translated into French law in 2017, obliges all companies to disclose the names of their beneficiaries, but at the moment it only applies to companies registered in Europe. So those in tax havens still avoid it.

Give the means for justice

Nevertheless, Transparency International is delighted with Bruno Le Maire’s statement. Stripping Russian oligarchs of assets she routinely believes come from dubious sources should allow for a more effective crackdown on corruption. Russia indeed ranks 139th out of 180 countries in the NGO Corruption Perceptions Index.

The judiciary still needs to have the means to conduct these investigations and demonstrate that an offense was indeed committed by the owners of the property. The National Financial Attorney’s Office, created in 2013 to deal with serious financial crime, would be competent but would need more judges to ensure that cases are actually investigated. Therefore, the NGO is calling for the creation of a real anti-corruption organization with more resources for justice, so that Bersi’s statements really have consequences. “If it is only political pressure, then these takeovers will be temporary and have no real impact on the fight against corruption.“, – explains the representative of Transparency International.

Arno Dumas, @ADumas5

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