Freedom Finance hopes Ukraine subsidiary will be removed from sanctions list by year-end
ALMATY. Dec 7 (Interfax) - Freedom Holding Corp's Freedom Finance Ukraine LLC considers its inclusion on the sanctions list of Ukraine's National Security and Defense Council to be a technical error and expects to be removed from this list by the end of this year, CEO and majority shareholder of Freedom Holding Corp. Timur Turlov told Interfax.
Turlov, who has obtained citizenship of Kazakhstan, is also on the sanctions list.
According to the Ukrainian president's decree no. 726/2022 dated October 19, 2022, which entered into force on the day of its publication, restrictive measures include the blocking of assets, restriction on trade operations (complete cessation), restrictions, partial or complete cessation of transit of resources, flights and transportation through Ukraine (complete cessation), prevention of the withdrawal of capital from Ukraine, termination of the fulfillment of economic and financial obligations, and revocation or suspension of licenses and other permits.
Turlov told Interfax that this decision was "a technical error."
President of Freedom Holding Corp. Askar Tashtitov said that the licenses of Freedom Finance Ukraine LLC were suspended, but not cancelled. He said that going forward, Freedom Finance Ukraine would follow the decisions of Ukraine's Securities and Stock Market National Commission. At the same time, he said that citizens of Ukraine still have access to their accounts and assets in Freedom Finance Europe.
Freedom Holding Corp. sold its Russian assets - Investment Company Freedom Finance LLC (Freedom Finance, Freedom RU), and Freedom RU's subsidiary FFIN Bank LLC - and pulled out of Russian business as announced on October 19, but the Ukraine-based holding had no business relations with these Russian entities, according to a statement issued by Freedom Finance Ukraine at the time.
The company stated that Turlov's Russian citizenship was terminated on September 22 and currently he is a citizen of Kazakhstan.
Freedom Holding announced plans to divest its Russian assets in early June against the backdrop of the conflict in Ukraine and their impact on financial markets. It was initially proposed that the holding's principal owner Turlov would first buy the assets and then in a year to 18 months resell the Russian business under a different name to management or another "acceptable" buyer.
However, after studying clarifications of sanctions issued by OFAC regarding investments and divestment of Russian legal entities by U.S. residents, the company abandoned this plan. Freedom Holding Corp. entered into an agreement to sell its Russian subsidiary, Investment Company Freedom Finance LLC (Freedom Finance, Freedom RU), and Freedom RU's subsidiary FFIN Bank LLC to Freedom Finance deputy CEO and board director Maxim Povalishin, the group said in a press release on October 19.
Freedom Holding Corp. provides financial services in 14 countries worldwide. The holding's shares are traded on NASDAQ, and its capitalization is near $3.6 billion.