New powers to target foreign financial institutions supporting Russia’s war machine are among a range of new sanctions introduced by the UK government to coincide with the war in Ukraine entering its fourth year. 

Three years on from President Putin’s full-scale invasion of Ukraine, the UK has imposed 107 new sanctions directly targeting those who continue to aid the invasion, representing the 

largest sanctions package since the early days of the invasion.

The sanctions announced this week follow Prime Minister Keir Starmer’s warning last week that we are facing a once-in-a-generation moment for the collective security of our continent. The measures will target funds going into Putin’s war chest and propping up Russia’s kleptocratic system.

Russia’s military machine

The sanctions will also target Russia’s military machine, entities in third countries that support it and the supply networks that it relies on. Targets include producers and suppliers of machine tools, electronics and dual-use goods for Russia’s military, including microprocessors used in weapons systems.

Thanks to new powers to target foreign financial institutions supporting Russia’s war machine, the UK government is sanctioning the Kyrgyzstan-based OJSC Keremet Bank, disrupting Russia’s use of the international financial system to support its war efforts.

Meanwhile, 13 Russian targets have also been sanctioned, including machine tool and electronics supplier LLC Grant-Trade, its owner Marat Mustafaev and his sister Dinara Mustafaeva, who have used the company to funnel advanced European technology into Russia to support its illegal war. Sanctions have also been issued against 14 ‘new kleptocrats’ including Roman Trotsenko, who is one of the wealthiest men in Russia and worth £2.2bn.

For the most current list of those sanctioned by the UK government, members should consult the updated list of sanctioned entities just published. 

UK’s commitment to Ukraine

Foreign Secretary David Lammy says this latest package of sanctions underscores the UK’s commitment to Ukraine. “Lasting peace will only be achieved through strength. That is why we are focused on putting Ukraine in the strongest possible position. As the world marks the grim milestone of Putin’s full-scale invasion entering its fourth year, we cannot and will not turn our backs on Ukraine in their fight for our shared security.

“Keeping the country safe is the government’s first priority and an integral part of the prime minister’s plan for change. Sanctions against Russia’s military machine and the revenues fuelling it will improve the chances of a just and lasting peace in Ukraine, which will benefit security and prosperity in the UK,” he says.

The government hopes the new sanctions will put further pressure on Putin’s energy revenues, the most vital source of funding for his illegal invasion. They include specification of another 40 ‘shadow fleet’ ships carrying Russian oil. These vessels have collectively carried more than $5bn worth of Russian oil and oil products in the past six months alone, the government says. The specifications bring the total number of oil tankers sanctioned by the UK to 133 – the highest of any nation in Europe. 

Role of accountants

Mike Miller, ICAEW Economic Crime Manager, says further measures to prevent the UK being used to facilitate economic crime and to inhibit the proceeds of such activities fuelling Russia’s war in Ukraine and other hostile activities were to be welcomed. 

“Many professional services firms, including those represented by ICAEW, have completely or substantially divested from Russia since the invasion in 2022. These sanctions are, therefore, unlikely to change the landscape of how accountancy firms operate. 

“However, we will continue to work to provide practical guidance to ensure that the chartered accountancy profession continues to play a key role in identifying and reducing sanctions evasion and economic crime more widely.”

In October last year the government launched a new Office of Trade Sanctions Implementation (OTSI), which it said would work with industry to make complying with sanctions obligations as straightforward as possible by issuing guidance and user-friendly online tools. OTSI has powers to publish information about sanctions breaches and impose civil monetary penalties.