David Cameron calls for $350bn in frozen Russian bank accounts to fund Ukraine war

Billions in Russian central bank reserves have been frozen by democratic countries around the world, with £26 billion of that in the UK

David Cameron has called for 350 billion dollars (£278 billion) in frozen Russian bank accounts to be used to fund the Ukrainian war effort.

The UK foreign secretary said there is a strong argument for seizing frozen Russian assets and using them to rebuild Ukraine, during a visit to the US.

“Instead of just freezing that money, let’s take that money, spend it on rebuilding Ukraine and that is, if you like, a downpayment on reparations that Russia will one day have to pay for the illegal invasion that they’ve undertaken,” Mr Cameron said. “I’ve looked at all the arguments and so far, I haven’t seen anything that convinces me this is a bad idea.”

David Cameron was speaking at a visit to the US State Department this week (AP)

Western governments have sanctioned scores of billionaires to isolate Russian President Vladimir Putin and choke his financial support. Almost $350bn of Russian central bank reserves have been frozen by countries around the world, with £26 billion of that in the UK.

On his visit, Mr Cameron also urged US policymakers to approve a new package of military aid for Ukraine after Congress blocked a $110bn (£88 bn) package of wartime funding for Ukraine and Israel as well as other national security priorities.

“We should pass this money to the Ukrainians,” he said. “We should back them and make sure it’s Putin that loses because if that money doesn’t get voted through, there are only two people that will be smiling: one of them is Vladimir Putin in Russia and the other one is Xi Jinping in Beijing,” the former British prime minister said.

In April 2022, the White House announced a proposal to seize the targeted tycoons’ assets and“enable the proceeds to flow to Ukraine. In the 21 months since then, however, few of the sanctioned businessmen have criticized Putin and just $5.4m has gone to Kyiv.

Because seizing assets to help Ukraine is complex, some experts suggest governments look at more creative methods.

One idea would be to establish a policy under which Russian businessmen could effectively defect to the West, denounce the war, and make a sizable donation of their assets to Ukraine.

In June, Britain announced a plan in which tycoons could donate frozen funds for Ukraine’s reconstruction. However, participation was low as the Foreign Office said it would not offer sanctions relief in return.

Ukraine does not support sanctions relief of any kind on tycoons and would accept it only in circumstances where “a very serious part of their assets are transferred for reconstruction,” said a sanctions adviser in President Volodymyr Zelensky’s office.