Banks urge Britain to tighten laws around seizing Russian assets

LONDON: International banks have warned the UK government that it must establish legal principles before it presses the button on the seizure of billions of pounds of Russian assets, otherwise it risks potential shocks to the global financial system and exposing institutions to legal action.

Sweeping international sanctions, imposed after Moscow's invasion of Ukraine in February 2022, froze an array of assets including about $300 billion owned by the Russian central bank. Now, on the second anniversary of the invasion, a global campaign by politicians and activists is demanding that the assets be seized and the proceeds sent to Kyiv.

US Secretary of State Antony Blinken and his UK counterpart David Cameron are among those who have called for seizures, while political leaders in the European Union have been more cautious. About two-thirds of the Russian central bank's $300 billion is stuck in the Belgium-based clearing house Euroclear.


That caution is echoed by some in the finance industry who told Bloomberg that they want the mounting political rhetoric to be translated into internationally coordinated measures to ensure that any seizures are lawful. Some bankers and lawyers in the UK warn that high-profile confiscations of assets risk damaging London's reputation as an international financial center and could spark questions about the rule of law.