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EU Official Describes How Seizing Russia’s Money Could Lead to Global Financial Collapse

March 13, 2024 (EIRNS)—Reuters quotes a senior EU official who warns against seizing frozen Russian money. Of some note, international media pick up the conclusion of the article, featuring in their headlines the EU official’s warning of a global financial collapse as a consequence.

The EU official explained that some 70% of all frozen Russian assets, worth some €190 billion, is held in the Belgian central securities depository Euroclear. Reuters quotes him as saying: “The moment the war ends and all settlements can be made, all the money that was provisionally retained will also be transferred to Ukraine. But we need a significant amount in Euroclear … because Euroclear will face a lot of claims…. The claims are to come from the Russian central bank which, through Russian courts that do not recognize Western sanctions, is likely to put its hands on the €33 billion of Euroclear money in the national securities depository in Moscow.”

Reuters continued the official’s account: “Russia could also take legal action to seize Euroclear cash in securities depositories in Hong Kong and Dubai, the official said, and more lawsuits against [sic] are likely from Western banks which lost their money invested in Russia.” They quoted him saying: “That’s the mechanism how Euroclear could be totally emptied, basically.”

Reuter’s conclusion, featured by various media, was:"If Euroclear were to run out of capital, the Belgian central bank would have to withdraw its license, likely causing a global financial crisis because Euroclear has assets in custody of €37 trillion, the official said.”