The Russian billionaire has stepped up efforts to move money from Europe to Dubai to avoid Western sanctions over the war in Ukraine, Reuters reported, citing financial and legal sources in the United Arab Emirates (UAE).
As a famous global tourist destination, Dubai is also considered the business center of the region. The UAE's refusal to condemn Russia's military activities in Ukraine at the UN Security Council seems to be understood by the wealthy in Russia as an invitation.
According to Reuters, Russian citizens have transferred their money from Switzerland and the UK to Dubai, after the two countries sanctioned Russia and threatened to freeze the assets of prominent Russian businessmen and politicians.
An unnamed Dubai-based lawyer said his company had received several questions from Russian authorities about moving very large sums of money to Dubai, some of which amounted to hundreds of millions of dollars.
Another source, a senior private bank director, said that Russian customers with accounts at private banks elsewhere are opening accounts at the same bank's branch in the UAE or with local banks. They note that the number of Russian customers has recently increased. Other sources said they have seen increased Russian investment in real estate in the region.
Analysts say the UAE, and especially Dubai, is a convenient location, just a few hours away from Russia and without the authorities responsible for the Western countries. Dubai has also been very popular with Russian tourists in recent years; the Russian is one of the most popular tourists and property buyers in the kingdom.
While Russian funds in Dubai have not yet been subject to Western sanctions, bank sources said there is a risk of damaging the reputation of financial institutions in the region that continue to work with Russia while many foreign corporations are cutting off relations with the UAE.
When asked to comment on Russian cash flow to the region, the Central Bank, the Dubai Media Office and the UAE Ministry of Foreign Affairs did not respond immediately.
Meanwhile, the Financial Action Task Force - a global financial crime monitoring agency based in Paris - last week included the UAE in the "grey list" of countries that must strengthen supervision. A source told Reuters that this means UAE banks will have to be cautious when welcoming Russian money if they want to avoid EU sanctions.
