‘Zero tolerance’ for sanction busters

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Nicosia is giving zero tolerance to Cypriot sanction busters tarnishing the island’s international reputation as a credible financial hub, said government spokesperson Konstantinos Letymbiotis.

His statement followed a high-level briefing at the Presidential Palace to evaluate the implementation of the measures adopted by the Cabinet on June 28 for coordinating sanctions.

Letymbiotis said the government is actively working to protect Cyprus’ reputation regarding sanctions on Russia following its invasion of Ukraine.

He said authorities were committed to zero tolerance towards sanctions evasion and legal violation in safeguarding the country’s reputation as a trustworthy financial centre.

Wednesday’s meeting’s primary objective was to update the president, the attorney general, key cabinet members, and officials regarding the country’s progress on monitoring sanctions.

The technical support provided by the British government for establishing a sanctions implementation unit is in its final stages.

“Detailed plans are anticipated within the month. Furthermore, this technical assistance has been expanded to encompass the creation of a supervisory authority,” said Letymbiotis.

A report assessing the investigative and prosecutorial practices related to financial crimes within the police and the Justice Ministry will be completed by the end of the month.

Two key appointments were also announced during the briefing.

Kikis Paphites, a finance ministry official, has been designated as the point of contact for receiving information from local and foreign authorities, with his appointment communicated to all embassies since July.

Dr Andreas Milidonis, a finance professor at the University of Cyprus, will support the government’s sanctions efforts, with a formal agreement between the state and the university set to be signed.

Letymbiotis revealed that the government’s domestic and international branding initiatives will be launched by the year’s end.

These initiatives include an information campaign aimed at rectifying Cyprus’ image abroad – not helped by the passports-for-sale scandal.

Last week, four more individuals and two companies related to Cyprus were included in a new US list of sanctions imposed for enabling Russia’s war on Ukraine.

The US and the UK imposed sweeping new measures against Moscow over the war in Ukraine, targeting Russia’s future energy capabilities sanctions evasion.

In April, the government took immediate action, responding to US and UK sanctions imposed on 23 Cypriot passport holders and numerous companies registered in Cyprus, which have allegedly facilitated sanctioned Russian oligarchs in concealing their assets.

Lawyer Christodoulos Vassiliades, sanctioned by both countries, stands out as a key individual in this context.

Russia subsequently issued an arrest warrant against him for his involvement in a large-scale money laundering operation.

Cyprus promptly froze the accounts of all sanctioned individuals, with the central bank director emphasising the necessity of doing so to avert potential economic catastrophe.