Western assets of Russian oligarchs will go to rebuild Ukraine

The U.S. Attorney’s Office may seize more than $5.4 million of Russian oligarch Konstantin Malofeev for violating the sanctions regime imposed on him.

The Manhattan federal court verdict was the first such order to confiscate the Russian billionaire’s assets since the U.S. Justice Department created a task force in 2022 aimed at cutting off the financial flows of Putin’s allies who support the war in Ukraine.

The judge’s decision will set a precedent, according to Klaus W. Larres, an expert and professor of political science at the University of North Carolina. According to Larres, the court verdict might possibly open the way for the seized funds to be used to rebuild Ukraine:

“Malofeyev is close to Putin. There is no doubt that he is involved in the war in Ukraine indirectly, through finances. He is currently in Russia and could have appealed the decision from there, but did not do so. So the court decided that since he wasn’t challenging it, the U.S. could do what it saw fit with the money, which was to send it to rebuild Ukraine. This is what drew attention because this is the first such case. Usually confiscated money, property, ships and yachts were frozen. Oligarchs could not use these assets, but they did not lose the legal right to their property. This court case could be a precedent and the beginning of a trend for the government to use the money frozen or confiscated from the Russian oligarchs at its own discretion. However, I do not think that a general rule will work here. Each case has to be proved and considered separately to exclude punishment for those who may have been unfairly accused of collaborating with the Putin regime.”

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