Russian Assets: Seizure

Vicky Ford Excerpts

Tuesday 14th March 2023 Commons Chamber

[Sir Iain Duncan Smith]

I entirely agree. I was going to raise that point at the end of my speech, but never mind: this is a shared debate.

I fully back that proposal, which is one of the recommendations that we have to make so that the Government can jump ahead of this. Too often we have been slow and, in the six months that have elapsed, in some of those cases, people have shifted their money around into all sorts of areas. One particular individual—I was going to name him, but I will not do so now—has managed to buy flats through a Cyprus company. His name is not registered, but they own it and the money is lodged there. This sort of stuff is going on and we need to shut it down.

[Vicky Ford (Chelmsford) (Con)]

I thank my right hon. Friend for raising such an important issue. Of course, the largest amount of Russian frozen assets are those of the Central Bank of the Russian Federation. Yesterday, the Chair of the Foreign Affairs Committee, my hon. Friend the Member for Rutland and Melton (Alicia Kearns), said that, if we do not have the right law in place to use those frozen Central Bank assets to pay for Ukraine’s reconstruction, we should change the law and test it in the courts. I agree with her; does my right hon. Friend?

[Sir Iain Duncan Smith]

My right hon. Friend is jumping ahead of me, so I will allow that point to stand for a minute.

I pay tribute to the hon. Member for Rhondda (Sir Chris Bryant), whose ten-minute rule Bill was on exactly this subject. There was a lot of logic and sense in that Bill, and we should use it as a baseline for quite a lot of the stuff that needs to happen. As he pointed out when he made his speech on the Bill, in the last year, the United Nations High Commissioner for Human Rights recorded 18,358 civilian casualties. He went on to say that 7,031 people had been killed, that 11,327 had been injured, including 177 girls and 221 young boys, that some 12 million people had left Ukraine and 7 million had been displaced internally. When I was there, I saw many people who had had to move to Lviv internally because their homes were no longer habitable, and they were living in terrible conditions.

[Vicky Ford]

Will my right hon. Friend give way?

[Sir Iain Duncan Smith]

I want to make a bit of progress, just in case my right hon. Friend is about to tell me what I have got here in my speech. Forgive me if I just get ahead of it, because everyone else will probably do the same.

Let us have look at the costs of the war, which are really what this is all about. Ukraine’s death toll is 60,000 and it is rising every day. The cost of reconstruction is now estimated to be between $750 billion and $1 trillion and rising, and these might be conservative estimates because the damage is still not fully accounted for. Since the beginning of the invasion, the UK has provided £2.3 billion in military assistance and another £220 million in humanitarian aid. The UK has frozen billions of pounds in Russian assets under sanctions following the invasion of Ukraine. The Office of Financial Sanctions Implementation has reported that £18 billion of assets owned by individuals and entities associated with the regime have been frozen since the beginning of the war, but some estimates suggest that more than £40 billion could yet be frozen and this is the point we want to get to.

--- Later in debate ---

[Sir Iain Duncan Smith]

I agree with the right hon. Lady. If countries do this individually, it will allow terrible regimes to dodge their money around from one financial centre to another, as some will not have done it. This has to be done in one go by all the developed world’s major centres, otherwise it will end up with disputes and problems. I applaud Canada for starting, but we need the City of London, New York, Zurich and all the other major centres to be serious about making sure this cannot happen and these assets will always be seized.

I can tell the Minister of State, Foreign, Commonwealth and Development Office, my right hon. Friend the Member for Berwick-upon-Tweed (Anne-Marie Trevelyan), that we understand the underlying problem, but my point is that the issues are not insuperable.

[Vicky Ford]

My right hon. Friend is making an excellent point, but I draw his attention to another source of funds. There are increasing stories that the Wagner Group may be using gold stolen from Sudan’s gold mines to fund part of its atrocious activities in Ukraine. The Wagner Group is obviously guilty of atrocities not only in Sudan but elsewhere in the Sahel and Africa. There are stories today that the Italian Defence Minister is directly linking the Wagner Group to the increase of small boat migrants in Europe. Does my right hon. Friend agree that, as well as taking action on Russian assets, we should urgently proscribe the Wagner Group as a terrorist organisation?

[Sir Iain Duncan Smith]

Yes, of course. It is a disgusting organisation led by a disgusting individual carrying out disgusting atrocities in Russia. It is also using slave labour in some of these mines. Of course the Wagner Group must be proscribed, as should the Islamic Revolutionary Guard Corps and other such organisations. We should be at the forefront of this, not lagging behind.

The Government’s general belief is that seizing these central bank reserves would violate Russia’s sovereign immunity and would therefore be a breach of international law. If we think about it, Putin has redefined international crime and is now hiding behind international law. It is time for us to come together to make the modifications. That is the key.