Germany Considers Confiscating €720 Million in Frozen Russian Assets for the First Time

, 20 December 2023, 11:00

Germany's Federal Prosecutor has raised the issue of confiscating hundreds of millions of euros of frozen Russian assets, which could establish a precedent in the country, with the total value of the frozen assets amounting to €720 million.

According to Spiegel, Federal Prosecutor Peter Frank has filed a motion with the Higher Regional Court of Frankfurt am Main to confiscate €720 million of frozen Russian assets into the state budget.

If the process goes ahead, it will establish a precedent for Germany. Until now, sanctioned Russian assets have only been frozen, depriving their Russian owners of the ability to manage them, but allowing them to retain ownership.

This includes money from the National Settlement Depository of the Moscow Exchange that was frozen in the summer of 2022.

According to Spiegel, as soon as the inclusion of these assets in the EU sanctions list was confirmed, JP Morgan received a request to transfer more than €720 million to the Commerzbank account of another Moscow Exchange subsidiary, National Clearing Corporation. Due to the sanctions, the banks refused to complete the transaction.

However, investigators are now considering this as grounds for confiscation of funds as an object of a crime, as an attempt to withdraw them after the sanctions have been imposed may be considered an attempt to circumvent EU sanctions.

Since the chances of arresting and prosecuting the perpetrators are almost zero, the state may try to confiscate the funds by court order.

The magazine also notes that Germany has had great difficulty even tracking Russian money since the implementation of sanctions. Even after the creation of a special working group, this has remained a problem because the real owners of luxury properties, yachts and cars are hiding behind complex schemes.

Meanwhile, US media outlets have learned that the US, in discussions with G7 partners, has stated that they can see ways to confiscate Russian assets in a way that is consistent with international law, and relevant debates have picked up in recent weeks.