Barclays Provides Banking Services for Sanctioned Russian Billionaire’s Charity
Barclays Plc, one of the UK’s largest banks, has started providing banking services for the Potanin Foundation, a London-based charity led by Russian billionaire Vladimir Potanin. This move comes after JPMorgan cut ties with the foundation in 2022 due to Potanin’s involvement in Russia’s invasion of Ukraine.
The Potanin Foundation, which manages a fund pool of $117 million, operates under the authorization of UK sanctions authorities and receives investment advice from Goldman Sachs. The engagement of Barclays with the foundation is drawing attention due to the increased regulatory scrutiny surrounding how major banks handle charity accounts, especially those associated with individuals facing sanctions.
In June 2022, the UK imposed sanctions on Vladimir Potanin, leading JPMorgan to liquidate investments and sever its relationship with his charity. This action prompted the Charity Commission to launch a statutory inquiry into the foundation’s asset protection and oversight. In response, Guy Hollander from Mazars LLP was appointed as interim manager in October 2022 to oversee the foundation’s property and affairs.
Barclays opened an account for Hollander to manage the charity’s assets with authorization from HM Treasury’s sanctions office. A spokesperson from Barclays confirmed that this step was taken in compliance with a granted license and clarified that the bank had no prior banking relations with the charity.
Financial reports indicate a significant reduction in the foundation’s activities, with income reported at £879,000 and expenses at £614,000 for the year ending December 31, 2022. This marks a substantial decrease from the peak spending of £42.7 million in 2019.
The involvement of Barclays in providing banking services to the Potanin Foundation raises questions about the responsibilities and obligations of major banks when it comes to managing accounts linked to individuals facing sanctions. The move comes amid mounting pressure on financial institutions to ensure compliance with regulations and prevent the misuse of funds.
Barclays’ decision to engage with the foundation comes at a time when the sector is facing increased scrutiny, and regulatory bodies are keen to investigate and prevent any potential wrongdoing. The Charity Commission’s ongoing inquiry into the foundation’s asset protection and oversight will play a crucial role in determining whether proper measures are in place to safeguard the charity’s funds and ensure accountability.
It remains to be seen how Barclays’ involvement will impact the foundation and its operations going forward. As the statutory inquiry continues, the actions and decisions taken by the bank will undoubtedly be closely monitored by regulatory authorities and stakeholders.
The Potanin Foundation plays a significant role in supporting various charitable causes, and the engagement of a major bank like Barclays will be of interest to the public, especially given the controversial nature of its leader’s sanctions. Transparency and adherence to regulatory guidelines will be essential for the foundation to regain trust and continue its philanthropic work.
More detail via Investing.com here… ( Image via Investing.com )