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In Cyprus, over €1.2 billion worth of Russian assets have been frozen, as part of Europe's broader effort to block Russian assets amid ongoing sanctions. However, most of these assets are not physically in Cyprus. Only a small portion is in cash or local assets; the majority of the €1.2 billion is managed through funds and services outside the country.
According to Kathimerini's Panayiotis Rougalas, the Cyprus Securities and Exchange Commission (CySEC) has been actively investigating these assets. CySEC's 2024 report highlighted its continued efforts to ensure companies under its supervision comply with anti-money laundering (AML) and anti-terrorist financing measures. In 2024, nearly 90 audits were conducted to evaluate how businesses manage the risks of illicit financial activities, including compliance with EU sanctions targeting Russia. CySEC also referred cases involving the transfer of Russian assets to Russian repositories for police investigation.
In addition to investigating Russian asset movements, CySEC's AML department reviewed 510 reports from compliance officers and internal audits submitted by financial companies. These checks are part of Cyprus's ongoing effort to improve its money laundering prevention measures. A positive step was seen in October 2024, when Cyprus’s progress in this area was recognized with an upgrade in its compliance rating, especially regarding cryptocurrencies.
Looking ahead, 2025 promises significant regulatory changes in Cyprus. New European regulations are expected to strengthen supervision on investment services. Some areas of focus will include updates to the AML framework, crypto asset regulations, and risk management based on new ECB guidelines. CySEC also plans to tackle emerging issues like the influence of AI, financial influencers (FinFluencers), and simulated trading.
In 2024, CySEC imposed €2.76 million in penalties, with most fines targeting companies in the investment sector. Over the past three years, sanctions have totaled €7.82 million. Besides fines, CySEC took corrective actions in 321 cases, including the suspension or revocation of licenses for several companies. Some firms were even referred to the Prosecutor General for potential criminal investigations. CySEC also issued warnings to the public about unlicensed investment websites.
Overall, Cyprus is working hard to stay aligned with European regulations, strengthening oversight to prevent illicit financial activities while handling the complex issue of frozen Russian assets.
*This article by Panayiotis Rougalas was translated and summarizzed from its Greek original
