Sanctions and Illicit Finance Monitoring and Analysis Network (SIFMANet)

The implications of Donald Trump’s imminent return to the White House on Russia’s illegal war in Ukraine are being minutely dissected. Will he deliver on his boast that he can end the war within 24 hours? How will he do that — if he can? At what cost to the long-suffering citizens of Ukraine? And how should Ukraine’s European allies anticipate and respond to whatever the new president — with all his unpredictability — chooses to do?

Sanctions are essentially instruments of economic war. They serve to block a country's access to the financial and physical resources needed for war."

Tom Keatinge, of think tank the Royal United Services Institute, said European policy makers had been preparing "autonomous European sanctions considering the possibility of a Trump presidency" but would have to bolster enforcement. "Should a Trump presidency reverse U.S. sanctions on Russia, Europeans will need to be much more muscular in ... enforcement action and will no longer be able to hide behind Uncle Sam," he said. A spokesperson for the Trump campaign said that President Joe Biden's "weak agenda ... has emboldened our adversaries, led to war in Ukraine", criticising Democratic presidential candidate Kamala Harris as "dangerously liberal", without outlining his position on sanctions.

This continues to be a success story. Fourteen packages have now been adopted, all unanimously and with the support of all Member States. At first, these packages followed each other frequently, but recently they have become less frequent. This does not mean that Member States are working less on sanctions. It should be noted that the implementation of sanctions is also very important, and perhaps even the most important part of it. And this is less spectacular. Each Member State has its own system of implementation, there is no common EU executive body.

It might make more sense for sanctions to be drawn up by national security and defence experts rather than diplomats, and to involve intelligence services in the process, which have a better idea of what sanctions are worth targeting."

(The U.S.) is saying ‘you are going to have to choose – do you want access to the U.S. dollar and the international financial system, or do you want to do a small amount of business with Russia,” Tom Keatinge, director of the Center for Finance and Security, a London-based research group, told the Kyiv Independent.

This will not be an easy procedure - the debate has lasted over two years, in my opinion too long. The arguments that worked at the beginning of the war (...) have long been reworked and reprocessed. We are left with one conclusion, a correct conclusion: Russia must pay.

The G7 has already said that Russia has to pay when this war ends. So all we're doing is taking this money today for what should eventually happen when this war ends... because Ukraine needs the money today..."

Unfortunately, the emphasis in Europe is on more sanctions. Every country that has been EU president for six months is under great pressure to come up with its own sanctions package. There is nothing against that, but implementation of existing sanctions is more important.

The EU deserves recognition for having announced thirteen packages of sanctions, but it is very important that they are being implemented effectively, and we have found that there is a structural problem in many EU countries.

Some companies are as cautious as the financial sector, while others are willing to take the risk if they can make money from it. (...) In parts of the business world, there is not the same maturity about the sanctions.”

On the international stage, Malta is guilty until it proves itself innocent. But Tom Keatinge, Director of the Centre for Financial Crime and Security Studies at RUSI, says fellow Member States can learn a thing or two from Malta on its sanctions policies.

The EU is working to balance the ‘carrot’ and the ‘stick’ in its sanctions diplomacy. (…) The positive framing has an important role, but there is also a way to remind these countries that allowing circumvention through their markets has consequences.

These methods [of sanctions evasion] are becoming incredibly complex. Before we checked two levels of ownership to find sanctions evasion, now you have thirty levels of ownership, and you have to plough through countless shell companies.

Not all EU states implement sanctions as rigorously as they could, either by not having criminalised evasion, or by having complex government structures, or by not having enough personnel, etc...

Countries like Georgia have found themselves in a very tough position because they they're being almost made to choose - do you want to be with the EU, do you want to be with Russia? How do you stay in the middle?

There will always be holes in the net of sanctions surrounding the Russian economy, but we must try and make that net as small as possible, and we must continue to respond to those holes.

the EU will tighten its sanctions policy from next year. Those people who are confirmed to have contacts with Russian oligarchs will be blacklisted...

We will see the EU become tougher and the messages from Brussels stronger, but the EU does not want to implement heavy sanctions against third countries.

The countries that have historically close economic ties with Russia are vulnerable to acting as gateways for exports to Russia."

[The Russian aggression against Ukraine] was an opportunity to do something that we should have done a long time ago: to question ourselves regarding the influence that [oligarchs] bought with their money within our society.

Putin organised this meeting with the oligarchs, then photographs were published. So he infected them, he prevented them from dissociating from him.

Keep in mind that sanctions are decided in Brussels, but each Member State decides how to implement them. Spain, for example, can decide whether to ban a company controlled by a Russian oligarch. I believe that the fact that each one decides for himself, that is, the lack of harmonisation, can cause gaps that the sanctioned company or person can take advantage of.

So far, our focus has been more on creating the sanctions, not on implementing them."

The statistics are suspicious. Why did these countries suddenly need an unprecedented amount of European Union (EU) goods? It is likely that a lot of our exported production goes to Russia.”

Sanctions are long-term working tools, not like switches that turn off the economy like a light bulb, so their impact on Russia is only beginning to manifest, Tom Keatinge, director of the Financial Crimes and Security Research Centre of the British security and defence think tank RUSI (The Royal United Services Institute), told ERR in a statement.

RIGA - Latvia's stance in relation to sanctions against Russia is very serious and determined, said Tom Keatinge, Director of the Centre for Financial Crime & Security Studies (CFCS) at The Royal United Services Institute (RUSI), in an interview with LETA. "Of the countries we have visited, you are the most determined ones. Not only in words, but also deeds. There were no questions you people could not answer," he said.

Beyond adding ever more products, entities and people on the list of sanctions, Europe should also work on implementation and enforcement. To make sanctions work in practice, Europe must urgently start to dismantle financial secrecy that currently allows corrupt officials and businesspeople to circumvent sanctions and hide ill-gotten gains."

...Latvia is among those countries that "both bark and bite" - so they are able to implement sanctions in real life as well. It's not like that everywhere. After the annexation of Crimea, the sanctions were weak, and we did not track how they were circumvented, as evidenced by the Russian invasion of Ukraine in February 2022, says Tom.

Tom Keatinge, Director of CFCS (Centre for Financial Crime and Security Studies), a research centre based in London, points to Turkey and the United Arab Emirates as being at the heart of these circuits. We can add Armenia, Kazakhstan or Georgia. According to the former banker, the system works in particular thanks to the more or less voluntary ignorance of Western companies: “They are in charge of applying the sanctions, but sometimes do not want to sacrifice their interests", deplores Tom Keatinge. When they suddenly see an increase in orders from a customer located in a suspicious country, they should ask themselves why. And who really is the purchasing entity. If they can't answer these questions, they shouldn't sell. He wants Western intelligence services "to ensure, by mapping the value chains, that there are no re-exports", modelled on the work of Israeli intelligence services to prevent Iran's nuclear proliferation...

Latvia went through a painful overhaul of the country’s financial system following the MONEYVAL assessment of 2018, but it worked out well as it meant that Latvia was better prepared when new sanctions on Russia were introduced."

For the first time, Europeans are putting in place sanctions targeting a country with which they are intimately linked, on commercial, financial or energy levels," says Tom Keatinge, of the British think tank Royal United Services Institute. Responsible for evaluating, country by country, the application of sanctions, he explains that “some fear that in wanting to strike the other, they strike themselves”.

Thanks to allies like Abu Dhabi, the Kremlin will not fall for a long time, says Tom Keatinge, head of the Centre for Financial Crime and Security Studies at RUSI.

Carolina Lewicka from Political Intelligence talks to Dr Kinga Redłowska from the Centre for Financial Crime and Security Studies of the Royal United Services Institute about how to design good and effective sanctions.

I'm afraid that most of the oligarchs will get their property back. But Russia caused hundreds of billions of dollars worth of damage to Ukraine, and it should pay for it," says the head of the Center for Financial Crime and Security Studies at the prestigious British think tank RUSI.

Political leaders have not yet clearly defined what the goal of these sanctions is, perhaps they don't even know exactly. They introduced the sanctions under pressure, because not imposing them would disappoint both the voters and the Ukrainian state and send a clear signal to the Kremlin about the weakness of the West. In 2014, after the annexation of Crimea, the West imposed too soft sanctions, so now we have the last chance to show our tough stance against aggressive Russia..."

...The sanctions bucket is still pretty leaky," says Keatinge. According to him, London will no longer be as welcoming a place for Russian oligarchs and their money as before, although British politicians also need to clean up their act and tighten the control of dirty or suspicious money. Keatinge leads a program mapping and combating dirty money at the UK's leading security and defense think tank RUSI. He was in Prague last week at seminars with Czech experts.

First of all, it should be said that it’s not an original idea because it was a point that was emphasised by the European Commission President Ursula von der Leyen in her State of the Union address in September. In any case, I think that for many years in Europe, when we thought about ‘dirty money’ we thought about criminal money coming from non-state actors, organised crime groups and and terrorists. But, of course, in recent months we’ve had very clear indications that money coming into the European Union is not only coming in for the purpose of crime but also to try and undermine our democracy, to sway elections, to buy influence....

Combating the financing of terrorist activity should be at the core of the security response, yet the policy community has seemingly moved on....

...If we believe - in theory - that sanctions packages weaken over time because the strongest sanctions are adopted at the beginning, then I would expect policymakers and legislators to spend a lot of time making sure that the first, second, third packages are properly implemented. Because plugging small holes in one place will be in vain if water pours through a giant hole in another. I think the EU has worked well so far. Now there are two things to do. Countries need to do what Lithuania and some other countries are doing - to dig deeper into the packages and ensure that they are implemented wherever possible. The second thing is that more must be done to harmonize sanctions...

Dirty money is undermining European democracy, and the effective implementation of sanctions against Russia is just part of an urgently needed response.