Russia to block foreign funds at type C accounts should US seize Russian assets

If the United States seizes Russian assets, Russia may confiscate financial assets and securities of foreign investors. In particular, it goes about the withdrawal of funds from C accounts.

Foreign investors use C bank accounts to pay taxes, duties, fees and other obligatory payments. They also use them to purchase federal loan bonds. It is believed that C-type accounts accumulate a total of one trillion rubles (as of spring 2023).

Russia may take such measures in response to the USA's April 20 move to confiscate Russian assets in Ukraine's favour. Dmitry Peskov said that legal services of any bank could understand catastrophic consequences of such actions.

According to Vladimir Yazev, investment portfolio manager at Aigenis, the Russian government may withdraw funds from C-type accounts in favour of the state. Russia may also block non-exchange assets belonging to unfriendly countries. Other experts believe that foreign securities in Russia could be confiscated should their owners refuse to participate in the exchange mechanism for Russian assets.

With this mechanism in effect, Westerners would receive Russians' blocked holdings in foreign securities, and Russians would receive Western investors' blocked holdings in Russian securities.