clearn.png
Wednesday July 6th, 2022 2:39AM

EXPLAINER: Why US needs a law to sell off oligarchs' assets

By The Associated Press

WASHINGTON (AP) — President Joe Biden doesn't want to just seize the yachts, luxury homes and other assets of Russian oligarchs, he wants to sell off the pricey goods and use the money to help rebuild Ukraine.

He's asking Congress to streamline the process to allow that to happen.

In the latest attempt to pressure Russia to end its war and to pay for the enormous costs of defending Ukraine, the Biden administration on Thursday called on Congress to enhance U.S. authority to liquidate assets seized from Russian elites — the “bad guys,” as Biden called them.

A look at what's afoot:

WHAT'S ALREADY BEING DONE?

The House on Wednesday passed the Asset Seizure for Ukraine Reconstruction Act, with only four lawmakers voting against the measure. The bill, which now goes to the Senate, would allow the president to confiscate and liquidate property owned by sanctioned individuals. The money could only be used for specific purposes.

The package that Biden sent to Congress goes further to create a new criminal offense, making it unlawful for anyone to knowingly own proceeds directly obtained from corrupt dealings with the Russian government. Additionally, property used to facilitate sanctions violations would also be eligible for seizure.

The White House says the new tools make sanctions more difficult to evade and the administration said it wants to use the money “to remediate harms of Russian aggression toward Ukraine.”

WHY DOES THE GOVERNMENT NEED LEGISLATION?

Under current federal law, only the Justice Department has the authority to determine how seized funds can be spent. And there are strict rules on who can benefit from seized proceeds. The Biden administration wants to make it easier for officials to decide how to use the proceeds of the blocked and seized property.

The White House proposal also wants to make forfeiture decisions reviewable in federal court on an expedited basis.

Ryan Fayhee, a former Justice Department prosecutor who now works in private practice on sanctions cases, said that because of the nature of the U.S. sanctions program, “we could see a lot of lawsuits as there’s a process one could take to challenge the forfeiture itself and they absolutely will,” anticipating sanctioned oligarchs' future litigation.

HOW MUCH HAS ALREADY BEEN SEIZED?

The White House says the Treasury Department has sanctioned and blocked vessels and aircraft worth over $1 billion, and has frozen bank accounts containing hundreds of millions of dollars of assets belonging to Russian elites. During a House committee hearing Thursday, the Treasury Department's Financial Crimes Enforcement Network's acting director, Himamauli Das, said the agency has received 2,000 suspicious activity reports connected to Russian oligarchs. Of those, 271 were forwarded to intelligence and law enforcement and Treasury's sanctions arm.

HOW CAN THE MONEY FROM SEIZED ASSETS BE USED?

Among other proposals, the administration's package extends the statute of limitations of money laundering investigations based on foreign crimes from five years to 10 years, adds sanctions evasion to the definition of “racketeering activity” in the Racketeer Influenced and Corrupt Organizations Act and would enhance the government's powers to work with other countries to recover assets linked to foreign corruption.

The House-passed Asset Seizure proposal is more limited than the president's proposal, where confiscated funds could only be used for specific purposes, including post-conflict reconstruction of Ukraine, support for Ukrainian refugees, weapons for Ukraine’s military and humanitarian support for the Russian people.

Additionally, the administration could only seize assets, within two years of the bill's enactment, if Russia remains engaged in its invasion of Ukraine, the president has imposed sanctions on the owner of the assets due to the ongoing conflict and the assets are worth more than $5 million.

Attorneys have said the process of actually liquidating and using the funds could take years.

WHAT ABOUT RUSSIAN CENTRAL BANK ASSETS?

The package that Biden sent to Congress does not address Russian Central Bank assets.

However Russia's more than $600 billion foreign reserve fund has been frozen by the U.S. and its allies.

Treasury Secretary Janet Yellen said last week that the prospect of using frozen Russian Central Bank funds to support Ukraine should be considered but “I wouldn’t want to do so lightly,” adding that it would have to be done in consensus with U.S. allies and partners.

In a virtual address to International Monetary Fund and World Bank leaders last week, Ukrainian President Volodymyr Zelenskyy said the proceeds of sanctioned property and Central Bank reserves should be used to compensate Ukraine for its losses.

HOW WOULD THE NEW LAW ON PROCEEDS FROM CORRUPT DEALINGS WORK?

The Justice Department and Treasury are already targeting the assets of Russian oligarchs who they say have evaded sanctions, including a 254-foot yacht that was in Spain and owned by an oligarch with close ties to Russian President Vladimir Putin.

Attorney General Merrick Garland said Thursday that the Justice Department's task force focusing on Russian oligarchs — known as KleptoCapture — anticipates taking on “at least 30 complex investigations over time.”

In order for the Justice Department to seize a yacht, prosecutors must first spell out their case and obtain a seizure warrant from a federal judge. The U.S. government would then need to pay to maintain, transport and dock the mega yachts until they can be sold off at auction.

The funds from the sale flow into the Justice Department’s asset forfeiture fund.

The government wants to use some of the forfeiture funds to support Ukraine, though the law doesn’t currently easily allow for that to happen, Garland said at a House subcommittee hearing on Thursday.

  • Associated Categories: Associated Press (AP), AP National News, AP Online National News, Top General short headlines, AP Online Headlines - Washington, AP Online Congress News, AP Business, AP Business - Industries, AP Business - Financial Services
© Copyright 2022 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
Explosions rock Kyiv again as Russians rain fire on Ukraine
Russia mounted attacks across a wide area of Ukraine on Thursday, bombarding Kyiv during a visit by the head of the United Nations
5:22PM ( 11 minutes ago )
Live updates | Rocket strike in southern Ukraine wounds boy
An 11-year-old Ukrainian boy was one of at least three people wounded in what emergency officials are calling the first Russian strike in a residential area of the southern city of Zaporizhzhia since Russia’s invasion began
5:09PM ( 24 minutes ago )
2022 NFL Draft l Record 8 teams don't own a first-round pick
A record eight teams enter the 2022 NFL draft without a first-round pick
5:04PM ( 29 minutes ago )
Associated Press (AP)
Man on trial in Capitol riot case blames 'rogue cop'
A retired New York City police officer charged with assaulting a police officer during the U.S. Capitol riot has testified that he was trying to defend himself after the officer punched him in the face
4:50PM ( 43 minutes ago )
Biden taking 'hard look' at student loan forgiveness
President Joe Biden said he is considering forgiving some federal student debt, a step that would help him fulfill a campaign promise and provide relief to borrowers who took out thousands of dollars in loans to finance their higher education
4:29PM ( 1 hour ago )
Top Democrats push for federal crackdown on high gas prices
Democratic leaders have announced an effort to give the Federal Trade Commission increased authority to crack down on oil and gas companies that engage in price gouging
4:28PM ( 1 hour ago )
AP Online Headlines - Washington
Democrats pitch boosting FTC to curb gas price gouging
Democratic leaders have announced an effort to give the Federal Trade Commission increased authority to crack down on oil and gas companies that engage in price gouging
2:42PM ( 2 hours ago )
Democrats face worsening legal environment on redistricting
The ruling by New York's top court striking down Democratic-drawn congressional maps is the start of what could be a rough road for the party in redistricting
2:26PM ( 3 hours ago )
Biden seeks $33B for Ukraine, signaling long-term commitment
President Joe Biden is asking Congress for an additional $33 billion to help Ukraine fend off the Russian invasion
2:13PM ( 3 hours ago )
AP Online Congress News
Stocks rally on Wall Street as technology giants rebound
Stocks rallied on Wall Street Thursday as technology companies clawed back some of the ground they had lost recently
4:38PM ( 55 minutes ago )
Robinhood's revenue fell more than expected at year's start
Growth slammed into reverse at the start of this year for Robinhood Markets, whose trading app has turned millions of people into investors for the first time
4:29PM ( 1 hour ago )
US economy shrinks, threats loom, but growth likely to last
The U.S. economy shrank last quarter for the first time since the pandemic recession struck two years ago, contracting at a 1.4% annual rate, but consumers and businesses kept spending in a sign of economic durability
4:04PM ( 1 hour ago )
AP Business
Putin gas cutoff shakes up Europe at little cost to Kremlin
Russian President Vladimir Putin is putting pressure on European governments with his proposal to pay for oil and gas in rubles
1:08PM ( 4 hours ago )
Stocks claw higher on Wall Street as tech giants rebound
Stocks rose in afternoon trading on Wall Street Thursday as technology companies clawed back some of the ground they had lost recently
12:14PM ( 5 hours ago )
Ukraine says Russian offensive in east gathering momentum
Russia’s offensive in eastern Ukraine is gathering momentum as the United Nations’ chief surveys the destruction in towns outside Kyiv that experienced some of the worst horrors of the first onslaught of the war
12:00PM ( 5 hours ago )
AP Business - Industries
Asian shares mostly higher after wobbly day on Wall Street
Asian shares have logged moderate gains after Wall Street stabilized following a sell-off in tech stocks a day earlier
3:02AM ( 14 hours ago )
Stocks end mixed after another wobbly day on Wall Street
Stocks ended with meager gains on Wall Street Wednesday, stabilizing after a sell-off in tech stocks a day earlier
4:51PM ( 1 day ago )
Stocks regain their footing a day after big tech sell-off
Stocks shook off a wobbly start and gained ground in afternoon trading on Wall Street Wednesday after a big sell-off in tech stocks a day earlier
3:22PM ( 1 day ago )
AP Business - Financial Services
Explosions rock Kyiv again as Russians rain fire on Ukraine
Russia mounted attacks across a wide area of Ukraine on Thursday, bombarding Kyiv during a visit by the head of the United Nations
5:22PM ( 11 minutes ago )
2022 NFL Draft l Record 8 teams don't own a first-round pick
A record eight teams enter the 2022 NFL draft without a first-round pick
5:04PM ( 29 minutes ago )
Ronaldo salvages 1-1 draw for Man United against Chelsea
Cristiano Ronaldo’s fifth goal in three games has salvaged a point for Manchester United in a 1-1 draw against Chelsea that further damaged his team’s chances of a top-four finish in the Premier League
5:03PM ( 30 minutes ago )
California subpoenas ExxonMobil in probe of plastics waste
California’s attorney general has subpoenaed ExxonMobil as part of what he called a first-of-its-kind investigation into the petroleum industry for its alleged role in causing a global plastic pollution crisis
4:58PM ( 35 minutes ago )
In NYC, ads for jobs will have to say what they pay
New York City has passed one of the nation’s most far-reaching requirements for employers to tell job-seekers what they can make
4:57PM ( 37 minutes ago )