Sanctioned Russian Oligarch Evades Sanctions by Selling Shares in Crypto Firm
A Russian oligarch, Mikhail Klyukin, who is under sanctions, is facing scrutiny for allegedly evading those sanctions by selling over £15 million worth of shares in a crypto firm chaired by former UK Chancellor Philip Hammond. The transaction involved converting the funds into cryptocurrency, which is believed to be an attempt to circumvent US sanctions.
Crypto Company Copper Technologies Faces Controversy
Copper Technologies, a company specializing in cryptocurrency investment and trading systems, became concerned when Klyukin, who owned more than 2% of the firm, was put on the White House’s sanctions list. To mitigate the risks posed by Klyukin’s presence as a shareholder, Copper facilitated the sale of his shares to a willing buyer for over £15 million. The payment was then converted into cryptocurrency and transferred to Klyukin, structuring the transaction to avoid breaching US sanctions.
Legal experts warn that Copper could have faced secondary sanctions if their involvement in a deal benefiting a sanctioned individual was discovered by US authorities. The use of cryptocurrency for fund transfers could further complicate matters, as President Joe Biden’s executive order prohibits deceptive transactions using digital currencies to evade sanctions.
Claims of Sanctions Evasion Under Scrutiny
Copper Technologies maintains that they followed all applicable sanctions laws based on legal advice. Sources close to Klyukin assert that his companies adhered to US sanctions, including the share sale in Copper. Philip Hammond, Chairman of Copper, reportedly learned about the share sale during a review of major shareholders. The company has faced skepticism from UK financial regulators due to its advocacy for digital assets and its failure to obtain full approval from the Financial Conduct Authority.
Hot Take: The Controversy Surrounding Sanctions Evasion
The alleged evasion of sanctions by a sanctioned Russian oligarch through the sale of shares in a crypto firm raises concerns about the effectiveness of sanctions and the role of cryptocurrencies in circumventing them. The involvement of Copper Technologies in facilitating this transaction also highlights the potential risks faced by companies dealing with sanctioned individuals. As governments continue to strengthen their regulatory measures, it is crucial for businesses in the crypto industry to ensure compliance with sanctions laws and avoid engaging in activities that may result in severe consequences.
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