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The Treasury’s role in helping sanctioned Russian warlord exposes our failure to tackle lawfare

(Alamy)

4 min read

You could almost hear the sound of dropping jaws. The news that Her Majesty’s Treasury helped lawyers bypass sanctions to help the boss of Russia’s brutal Wagner Group pay legal costs provoked outrage and disbelief in equal measure.

The news came as openDemocracy shared leaked emails that revealed the little-known Treasury Office for Financial Sanctions Implementation licenced Yevgeny Prigozhin to spend thousands of pounds to fly his English lawyers to Russia, to polish the warlord’s case to sue Elliot Higgins, founder of Bellingcat. In a fiery urgent question called by David Lammy, it emerged that ministers have taken a hands-off approach to decisions to write these sanctions waivers – even if the waivers are for warlords. That system is now under urgent review. 

London courts have now become the arena of choice for the rich and powerful to try and silence journalists

The incredible story starts when Prigozhin was sanctioned by America for running troll farms that interfered in the 2016 United States presidential campaign. But in the summer of 2020, Bellingcat began running a crucial series of stories about the Wagner Group, a blood-thirsty gang of mercenaries which hired former Russian soldiers, and its barbarities across Africa, including the alleged murder of journalists. Bellingcat revealed it was none other than Yevgeny Prigozhin at the helm. 

It wasn’t until Christmas 2020 that the Foreign Office got its act together and imposed sanctions on the warlord for running a “deniable military capability” for the Russian state. 

Leaked emails reveal that Prigozhin was alarmed by the Bellingcat’s stories which he thought had triggered the sanctions against him. At the time Progozhin denied being behind the Wagner group and wanted to sue Elliot Higgins for defamation.

The lawyers – having been told by Progozhin that he was innocent and believing that everyone is entitled to legal representation – went to work for months until they ran into a cash flow problem. There was no way of getting paid because Prigozhin was banned from shifting money from his accounts at Sberbank in Russia through to the NatWest bank accounts of the London lawyers. And so, the London lawyers applied to the Treasury for licences on Prigozhin’s behalf for him to pay nearly £5,000 for a luxury hotel, business class airfares, a chunky subsistence payment, a £200 PCR test and express visa charges to fly the lawyers to St Petersburg. And the Treasury gave it a green light.

In the end, Prigozhin’s London lawyers stopped working for him before it became clear that he was behind the Wagner Group, but the damage had already been done.

It moved Chris Steele, a former MI6 officer in Moscow to exclaim, “In 35 years of observing HMG’s Russia policy, I’ve never seen anything as shocking”.

But the scandal reveals not one but two profound problems with the United Kingdom’s system for tackling economic crime. 

First, there is the blunt question of how ministers could have possibly given officials the latitude – unchecked it seems – to sign off on expenses for a Russian warlord.

But the deeper, darker, question is why Prigozhin chose London as the strike-point to hit at Elliot Higgins. And the disturbing answer is because London courts have now become the arena of choice for the rich and powerful to try and silence journalists. Global Britain is now a global centre for lawfare. 

When the Foreign Policy Centre surveyed investigative journalists, it found that three quarters had received some sort of legal threat designed to shut them up. And UK firms accounted for more of these legal actions than the US and Europe put together. 

MPs on all sides are now determined to change the law and give judges the power to strike out legal actions – known as Strategic Legal Action Against Public Participants, or SLAPPS. Bob Seely has readied a Private Members Bill. My own amendments to the Economic Crime Bill are now on the record. Ministers have said they support a change in the law. But they claim there isn’t yet the time. Meanwhile, the abuse of our courts is grows day by day. And countless stories from countless journalists remain unprinted, unseen and unheard.

 

Liam Byrne is the Labour MP for Birmingham Hodge Hill.

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