Swiss deny drop in value of frozen Russian assets signals weak enforcement

By John Revill

ZURICH (Reuters) - Switzerland reported a 1.7 billion franc ($1.9 billion) fall in the value of frozen Russian assets on Tuesday compared to the end of last year, though it denied this was a sign it was doing too little to sanction Moscow over its invasion of Ukraine.

The value of frozen Russian assets fell to 5.8 billion francs from 7.5 billion at the end of 2023. But the State Secretariat for Economic Affairs (SECO), which oversees sanctions, said most of the reduction was because previously frozen assets were now worth less, not because it had become lax in enforcement.

Falling stock values had wiped 2.3 billion francs off the worth of previously blocked assets, SECO said, while an extra 580 million francs in assets held via complex financial structures had been discovered and frozen last year. This included luxury cars and artworks.

Switzerland was now in a "completely different place" to last year when the G7 countries criticised Swiss loopholes on sanctions, and was implementing them well, said Simon Pluess, head of export controls and sanctions at SECO.

"I think Switzerland is doing a lot," Pluess told reporters, noting he had been part of a high-level economic delegation to the United States in February. "I can tell you: not once did we have pressure put on us there."

Although the frozen cash was only a fraction of the 150 billion francs in Russian assets estimated to be held in Switzerland, Pluess said most Russians who lodged money in the country were not on the sanctions list.

The number of Russian individuals whose funds are subject to being blocked in Switzerland now stands at 1,703, while the number of companies and organisations sanctioned is 421.

The sum frozen is separate from 7.24 billion francs in assets belonging to the Russian central bank, which has also been immobilised by Switzerland - under which all transactions are banned.

Switzerland has so far adopted all European sanctions measures aimed at preventing Russia from acquiring goods and technology for its army, but Bern has also forged its own path.

The Swiss parliament last week ruled out joining an international task force for enforcing economic sanctions against Russia, which includes the United States, Australia, Canada, the European Commission, France, Germany, Italy, Japan and Britain.

The government had recommended not joining the task force, arguing Switzerland already cooperated with the participating countries, and said staying out of it would benefit a peace summit on Ukraine, due to be held on June 15-16.

($1 = 0.9124 Swiss francs)

(Reporting by John Revill, editing by Dave Graham)