On July 6th, in a long-awaited announcement, UK Foreign Secretary Dominic Raab unveiled a sweeping package of sanctions targeting some of the world’s most notorious human rights abusers and criminals under the so-called UK Magnitsky Act. “If you’re a kleptocrat or an organised criminal you will not be able to launder your blood money in this country”, Raab proudly declared, before unveiling a first batch of 49 sanctioned individuals. Yet despite this long overdue move, the government’s move provokes more questions than answers—specifically about the people that were left off the list.
In his statement to the House of Commons introducing the new sanctions regime, Raab vowed to take on international organised crime – starting with a ‘who’s who’ list of officials from Russia, North Korea, Saudi Arabia and Myanmar. The 49 are accused of a plethora of abuses, from being involved in the murder of journalist Jamal Khashoggi or the death of Russian lawyer Sergei Magnitsky, to Burmese generals responsible for the crackdown on the Rohingya people and the men running North Korea’s gulags. For their sins, their UK-based assets have been frozen and their right to fly to the UK has been suspended.
“The usual sound without fury”
Raab framed the announcement as a signal to the international community: “this is a demonstration of Global Britain’s commitment to acting as a force for good in the world”. But commentators were quick to poke holes in Raab’s lofty rhetoric. Over at the Spectator, Russia hand Mark Galeotti called it “the usual sound without fury” and argued that the chances of punishment are exceedingly low. Striking a similar note in the Guardian, Luke Harding bemoaned that the choice of sanctioned individuals was another case of “realpolitik triumphing over human rights concerns.”
Even if more names are expected to be added to the list, it does little to address the vast number of shady individuals that have sought refuge in the UK. Indeed, over the past decades, London’s posh neighbourhoods have attracted a star-studded cast of oligarchs, runaway fraudsters and embezzlers who made their fortunes with little respect for human rights, by taking advantage of the chaos usually associated with emerging markets. It’s unfortunate that Raab’s initiative is so outward-focused, as it does precious little to address these individuals, despite the fact that they bring much more than just dirty cash with them.
Most – albeit not all – of these London-based fugitives are Russian, giving the city the unfaltering nickname of Londongrad. A textbook example is Knightsbridge resident Vladimir Makhlai, who moved to the UK in 2005 following revelations of large-scale fraud during his time at the helm of TogliattiAzot (ToAZ), a Russian ammonia plant. According to court reports, up to £1bn disappeared from the company’s balance sheet under Makhlai’s watch, throwing a spanner in both the plant’s machinery and in the books of investors and shareholders. Defrauded, rusting and falling apart, ToAZ’s equipment has been blasted by regulators, who identified over 300 environmental and labour violations. Last year, both Makhlai and his son were sentenced in absentia to nine years in prison by the Russian courts – without eliciting any reaction from the UK government.
Another, more political example, is the case of Youssef Boutros-Ghali. The former Egyptian finance minister is accused in his home country of multiple counts of corruption. In 2017, the country’s Illicit Gains Authority stated that he abused his position of power to squander millions in public funds. Relying on his British political asylum papers, he managed to evade several arrests around Europe, setting up shop in London. When Boutros-Ghali obtained his UK asylum following the Arab Spring, few seemed to mind that he was an integral part of the Egyptian government under President Mubarak from 1993 to 2011, a regime tarred with accusations of human rights abuses, and renowned for torture and arbitrary detention.
Or take the case of Isabel dos Santos, Africa’s richest woman, who is currently on the lam following accusations of embezzlement of public funds in Angola to the tune of $5 billion amassed during her father’s 38-year rule of the country. Dos Santos has taken refuge in central London where she owns expensive property. While she denies all charges, the International Consortium of International Journalists (ICIJ) has published ample reporting of wrongdoing as part of the explosive “Luanda Leaks”. The ICIJ revealed that, with the help of white shoe Western consulting firms, Angola’s “first daughter” used more than 400 front companies in 41 countries to pocket billions over two decades.
What’s frustrating in such cases is that the UK government has the tools to put a stop to these abuses. Last year, Nirav Modi, one of India’s most high-profile fugitives, was remanded in custody for running a scam in India that may have cost the Punjab National Bank $2 billion. The son of the former Moldovan president Vladimir Filat, who is accused of stealing 15 per cent of his country’s GDP, has been ordered to hand over £500,000 in an investigation by the UK’s National Crime Agency.
But much more needs to be done if the UK Government genuinely wants to take its ambition of tackling international organised crime seriously. “Raab’s list” is a step in the right direction, but taking steps against corruption abroad while turning a blind eye at home is nothing more than virtue signalling. Let’s hope that will not be Raab’s legacy.