Campaigners and politicians are calling for the United Arab Emirates to be blacklisted over its failures to combat the flow of “dirty money” and to enforce sanctions imposed on Russian oligarchs.
The Gulf state has emerged as a key refuge for the Russian super-rich fleeing the impact of global sanctions, with private jets and superyachts linked to oligarchs heading to the UAE after the invasion of Ukraine.
Bill Browder, the financier and critic of Vladimir Putin’s regime, said: “Dubai has long been a safe place for dirty money. It should now be put on financial blacklists and its leaders shouldn’t be welcome here.”
He said secondary sanctions should be imposed on the UAE unless it provided assistance to countries pursuing the oligarchs’ assets.
It emerged last week that, for more than three months, one of the world’s most expensive private jets, belonging to the former Chelsea football club owner Roman Abramovich, has been grounded in Dubai. The US Department of Justice cited the last recorded flight of the $350m Boeing 787 Dreamliner – from Moscow to Dubai on 4 March – in legal documents applying for its seizure.
Agents were also authorised by a judge to seize a second aircraft belonging to Abramovich – a Gulfstream G650ER – in Moscow, despite no prospect of it being immediately impounded.
FBI investigators have found, like many others pursuing the assets of oligarchs, that the trail frequently leads to the UAE. There has also been a surge in Russians buying properties there. The UAE was put on a “grey list” by global watchdog the Financial Action Task Force (FATF) in March because of deficiencies in its measures to combat money laundering and other financial crimes, and there are now calls for the country to be included on similar international lists.
Officials in the UAE do not consider that they are required to implement sanctions drawn up by other countries, but insist they are working to remedy concerns highlighted by the FATF. The country also signed a number of mutual legal assistance and extradition pacts with other states, including the US, on 24 February, the same day that Russia invaded Ukraine. The fate of Abramovich’s private jet may now be a test of its commitment to international cooperation. On 25 February, the UAE abstained from a UN security council resolution condemning the Ukraine invasion.
Karen Greenaway, an attorney and former FBI agent who specialised in illicit money flows, said US officials would almost certainly seek the assistance of the UAE authorities over the jet linked to Abramovich.
“UAE officials say they are cleaning up their act on financial transparency but are now having to walk the line between Russia and the US, the UK and the EU,” she said.
The UAE is a popular destination for Russian tourists and also has about 100,000 Russian-speaking residents. A report by the Dubai property agency Betterhomes found property purchases in the emirate increased by 67% in the first three months of 2022.
A superyacht that has “gone dark” on ocean tracking systems – the futuristic £240m Motor Yacht A linked to the billionaire Andrey Melnichenko – has been spotted in port in the northern emirate Ras al-Khaimah, according to the Financial Times.
Melnichenko was subjected to sanctions by the EU in March, and the Italian authorities impounded his 143-metre Sailing Yacht A the same month. Motor Yacht A has so far escaped enforcement of sanctions.
The superyacht Madame Gu has been linked to Andrey Skoch, a billionaire and member of Russia’s parliament who is subject to sanctions by the US, Britain and the EU. The superyacht is also under American sanctions but its location is unknown. Its last reported sighting was in Dubai on 6 March.
Dubai’s role as a sanctuary for the Russian elite since the Ukraine invasion has once again put a spotlight on its measures to combat money laundering and illicit money. An investigation published last month into a leak of Dubai property data revealed numerous property owners accused or convicted of crimes or under international sanctions, including business people close to the Kremlin.
Members of the European parliament last month wrote to Mairead McGuinness, commissioner for financial services, urging that the UAE be included on its list of third countries which pose significant threats to the financial system.
Kira Marie Peter-Hansen, a Danish MEP, said the latest investigation had revealed how the UAE was a safe haven for criminal proceeds, corrupt officials and Russian oligarchs. She said: “We want the UAE put on a blacklist, especially in light of the large number of Russian oligarchs using the country to avoid sanctions.”
UAE officials did not respond to a request for comment.
