Crypto Scandal: Russian Oligarch Accused Of Sanctions Evasion In £15 Million Firm Share Sale

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A sanctioned “Russian oligarch”, Mikhail Klyukin, has come under scrutiny for allegedly evading sanctions by selling over £15 million worth of shares in a crypto firm chaired by former UK Chancellor Philip Hammond. 

The transaction, which involved transferring the funds into cryptocurrency, is believed to have been an attempt to circumvent US sanctions.

Crypto Company Copper Technologies Under Fire

According to a report by The Guardian, Mikhail Klyukin faced sanctions due to his role on the supervisory board of Russian lender Sovcombank, following the invasion of Ukraine and the US’s targeting of “elites close to Vladimir Putin.” 

Copper Technologies, a company specializing in digital systems for cryptocurrency investment and trading, became concerned when Klyukin, who owned more than 2% of the firm, appeared on the White House’s sanctions list in March 2022.

As Klyukin’s presence on the shareholder register posed risks for Copper, the company reportedly arranged a transaction aimed at removing him. Acting as an intermediary, Copper facilitated the sale of Klyukin’s shares to a willing buyer who paid over £15 million in sterling.

Copper then converted the payment into cryptocurrency and transferred the digital assets to Klyukin. The transaction appears to have been structured to avoid breaching US sanctions, which prohibit the involvement of American citizens or the use of dollars in dealings with sanctioned individuals.

Legal experts highlight the potential risks that Copper could have faced, including secondary sanctions if US authorities were aware of its involvement in a deal that benefitted a sanctioned individual. 

Secondary sanctions allow Washington to penalize non-US entities that undermine US sanctions, potentially leading to exclusion from the US financial system. 

The use of cryptocurrency for fund transfers could have further aggravated the situation, as an executive order by President Joe Biden explicitly prohibits deceptive or structured transactions using digital currencies to circumvent sanctions.

Scrutiny Over Sanctions Evasion Claims

Per the report, Copper Technologies maintains that it complied with all applicable sanctions laws based on external legal advice. Sources close to Klyukin claim that his companies adhered to US sanctions, including the share sale in Copper. The company stated on the matter:

We carefully considered the implications, including with the assistance of specialist external sanctions counsel in various jurisdictions, and concluded that the transaction was compliant with all applicable sanctions requirements. 

Philip Hammond, who became Chairman of Copper in January 2023, was reportedly unaware of the share sale at the time but was later informed during a review of major shareholders. 

Copper’s advocacy of digital assets has faced skepticism from UK financial regulators, and the company’s failure to obtain full approval from the Financial Conduct Authority and the global cryptocurrency market’s downturn affected the value of its growth shares.

The 1-day chart shows the total crypto market cap’s continuous growth. Source: TOTAL on

Featured image from Shutterstock, chart from 

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