UK warns of lawsuit against Abramovich over Chelsea sale funds
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The UK is considering legal action to access £2.34 billion in frozen funds from Roman Abramovich’s Chelsea FC sale to support humanitarian aid for Ukraine.
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Chelsea soccer club owner Roman Abramovich at a match between Chelsea FC and FC Barcelona, in Gothenburg, Sweden, Sunday, May 16, 2021. (AP)
The UK government has indicated that it may pursue legal action against billionaire Russian businessman Roman Abramovich to secure the release of £2.34 billion ($3.2 billion) from the proceeds of his sale of Chelsea football club, Bloomberg reported on Monday.
According to the Bloomberg Billionaires Index, Abramovich, whose net worth exceeds $8 billion, sold the London-based football club in May 2022 to a consortium led by American investor Todd Boehly, following sanctions imposed on him by Britain and the European Union due to his alleged ties to Russian President Vladimir Putin.
For the past three years, the funds from the sale have remained frozen in a UK bank account, as they cannot be accessed or transferred without approval from Britain’s Office of Financial Sanctions Implementation, a division of the Treasury responsible for enforcing financial restrictions.
Over the years, multiple UK governments have maintained that the frozen funds should be allocated toward humanitarian assistance for Ukraine, while attempting to reach a mutual agreement with Abramovich to direct the money toward these relief efforts.
UK considers legal actions against Abramovich
In a Monday night statement, the UK government stated that all attempts to reach an agreement with Abramovich had failed and that legal action was now being considered as a potential next step.
Foreign Secretary David Lammy and Chancellor of the Exchequer Rachel Reeves issued a joint statement expressing the government's firm commitment to ensuring that the funds from Chelsea FC's sale are directed toward humanitarian relief in Ukraine, particularly in light of what they called Russia's unlawful invasion. They also conveying their significant disappointment that no mutual understanding with Mr. Abramovich has yet been achieved.
“While the door for negotiations will remain open, we are fully prepared to pursue this through the courts if required, to ensure people suffering in Ukraine can benefit from these proceeds as soon as possible,” they said in the statement.
In 2022, the UK government authorized approximately £200,000 from the frozen funds to cover legal and administrative expenses for setting up a charitable organization and engaging specialists to design a strategy for allocating the remaining money.
Acting CEO Mike Penrose informed Bloomberg in 2023 that the proposed foundation would concentrate on humanitarian initiatives aimed at providing medical assistance, educational support, and shelter programs for Ukrainian civilians affected by the conflict.
The UK government has collaborated with both the European Commission and Portuguese authorities, where Abramovich holds citizenship, to maintain sanctions enforcement and decide how to allocate the funds, though this coordination has presented significant logistical and legal challenges.
