German Federal Prosecutor Peter Frank is looking to seize 720 million euros ($787 million) in Russian funds frozen in Germany following Vladimir Putin's full-scale invasion of Ukraine, amid a debate about how to redirect confiscated assets from Moscow to Kyiv.
Frank has applied to Frankfurt am Main Higher Regional Court to confiscate the money belonging to the Moscow Stock Exchange subsidiary National Settlement Depository (NSD), which was sanctioned by the EU in June 2022, Der Spiegel reported.
The German state has only frozen the funds and assets of sanctioned Russian individuals and companies that remain owners of the assets if they cannot dispose of them. But Der Spiegel described Frank's move as representing "a new dimension in the enforcement of international sanctions against Russia," according to a translation.
The money had been deposited in the German branch of the American bank JPMorgan. The subsidiary had tried to transfer the funds, which sources told the paper could be an attempt to circumvent sanctions and, therefore, a crime. If the funds are confiscated, they would be redirected into Germany's federal budget and would mark a change in Berlin's position toward Russian assets it holds.
Der Spiegel reported that the money would not be earmarked for the state budget and that there have been calls to use confiscated Russian funds to help Ukraine's effort to fight Russian aggression.
"We will not allow Russian funds used to finance the illegal war of aggression against Ukraine to be held unchallenged in German accounts," Justice Minister Marco Buschmann said, according to the Associated Press.
Newsweek has contacted the National Settlement Depository (NSD) for comment by email.
In June, European Union leaders pushed senior officials to find legal ways to funnel proceeds from billions of dollars of frozen Russian assets into helping rebuild Ukraine.
The bloc has frozen more than $300 billion of Russian central bank assets since the start of the war and another 30 billion euros of Russian oligarchs' private assets were also immobilized.
In October, Ukraine's presidential office head Andriy Yermak said that the U.S. and the EU were working on legal procedures to transfer the frozen assets to Ukraine.
Secretary of State Antony Blinken announced during a visit to Kyiv in September that the U.S. plans to fund support for Ukrainian military veterans from "assets seized from sanctioned Russian oligarchs."
On Wednesday, citing an unnamed EU source, Russian state agency Tass said that Brussels would not lift sanctions against Russia even if hostilities in Ukraine ended and a peace agreement is signed.
Putin appears to be reacting against EU sanctions in kind, ordering that German gas and oil producer Wintershall Dea and Austrian oil, gas and petrochemical company OMV, be stripped of multi-billion-dollar stakes in gas extraction projects in Russia's Arctic.
"The presidential decree is further confirmation: Russia is no longer a reliable economic partner," a Wintershall spokesperson told Reuters.
Russian entrepreneurs have also gained control over some Western assets in Russia including Carlsberg's eight breweries and Danone's enterprises.
Uncommon Knowledge
Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
About the writer
Brendan Cole is a Newsweek Senior News Reporter based in London, UK. His focus is Russia and Ukraine, in particular ... Read more
