The UK has made its first 22 designations under the new regime, including individuals in Russia, South Africa, Honduras, Nicaragua, Guatemala and South Sudan.
The UK has established a Global Anti-Corruption Sanctions Regime as part of efforts to prevent and combat serious corruption around the world.
The new sanctions regime gives the UK an authority similar to the US’ Global Magnitsky programme and Canada’s Justice for Victims of Corrupt Foreign Officials Act, which target both human rights abusers and corrupt actors.
Honeypot for corrupt actors
“Corruption has an immensely corrosive effect on the rule of law, on trust in institutions,” Foreign Secretary Dominic Raab said on Monday (26 April), announcing the new regime. “It slows development, it drains the wealth of poorer nations. It keeps their people trapped in poverty. It poisons the well of democracy around the world.”
Raab said the UK’s status as a global financial centre makes it a “honeypot” for corrupt actors who seek to launder dirty money through banks and businesses. “That’s why we have already taken steps to become a global leader in tackling corruption and illicit finance.”
The launch of the new anti-corruption sanctions regime follows the launch of the UK’s Global Human Rights sanctions regime introduced last year, which has resulted designations of 78 individuals and entities involved in human rights violations – including in Russia, Saudi Arabia, Venezuela, Pakistan, Myanmar, North Korea, Belarus, The Gambia, Ukraine and China.
The new regulations will enable the UK to impose asset freezes and travel bans on individuals and organisations who are involved in serious corruption, with a clear focus on bribery and misappropriation of property, including embezzlement.
Also on Monday, the UK government published new guidance on how to implement and comply with its Global Anti-Corruption Sanctions Regulations 2021. It covers the prohibitions and requirements imposed by the regulations and offers best practices for compliance and enforcement, as well as circumstances where the requirements do not apply.
In introducing the new regime, the UK has also made its first 22 designations – including sanctions on 14 individuals involved in the USD 230 million tax fraud in Russia uncovered by tax adviser Sergei Magnitsky, who later died in a Moscow prison after being refused medical treatment.
In addition, the UK is imposing sanctions on four individuals – Ajay, Atul and Rajesh Gupta, and their associate Salim Essa – for their roles in “serious corruption in South Africa which caused significant damage to its economy and directly harmed the South African people.”
Three individuals involved in corruption in Honduras, Nicaragua and Guatemala are also being designated – including for facilitating bribes to support a drug trafficking cartel.
Sudanese businessman Ashraf Seed Ahmed Hussein Ali, known also as Al Cardinal, is also being sanctioned for the “misappropriation of significant amounts of state assets”, which “caused serious damage to public finances in South Sudan and has also contributed to the ongoing instability and conflict there”.
Complementary sanctions actions
“The United Kingdom’s new Global Anti-Corruption Sanctions Regime provides opportunities for the United States and the United Kingdom to take complementary sanctions actions where appropriate, magnifying the impact of our respective sanctions,” US Treasury Secretary Janet Yellen said in a statement welcoming the new regime.
“The use of sanctions can further incentivise businesses to adopt a more proactive corporate risk and due diligence approach, which takes into account both human rights and corruption issues.”
US Secretary of State Antony Blinken also released a statement commending the UK on the establishment of the new regime, which “reinforces the US-UK partnership in the fight against corruption and illicit finance.”
“The United States looks forward to continuing our partnership with like-minded governments and civil society alike to defend human rights, combat corruption, and promote accountability and good governance,” he said.