A dual citizen of Russia and the United Kingdom appeared in a London courtroom on Tuesday, accused of using cryptocurrency to fund pro-Russian separatist militias operating in eastern
Ukraine, in what prosecutors describe as a serious breach of UK sanctions law.
Mikhail Vlasov, 43, is charged with eight counts of violating financial sanctions by sending digital assets to support groups affiliated with Russian-backed forces in the Donetsk and Luhansk regions — areas at the heart of the ongoing conflict between Ukraine and Russia. These charges are being brought under legislation designed to restrict financial aid to entities involved in undermining the sovereignty and territorial integrity of Ukraine.
During a brief preliminary hearing at Westminster Magistrates’ Court, prosecutors alleged that Vlasov knowingly transferred funds in the form of cryptocurrency to individuals and organizations linked to the so-called Donetsk People’s Republic (DPR) and Luhansk People’s Republic (LPR), which the UK government designates as "self-proclaimed, pro-Russian separatist states."
“The evidence suggests a deliberate and systematic attempt to circumvent UK sanctions using digital assets,” said lead prosecutor Caroline Edwards. “These transfers were made with the awareness that the recipients were engaged in activities contrary to international law and UK policy.”
The transactions, believed to have occurred between 2021 and early 2023, allegedly amounted to tens of thousands of pounds and were traced through blockchain analysis conducted in cooperation with international law enforcement agencies. Authorities claim Vlasov used a network of crypto wallets and offshore exchanges to obscure the origin and destination of the funds.
Vlasov, who was arrested at his London residence in early June, has denied any wrongdoing. His defense counsel stated that the case raises complex questions about the interpretation of sanctions law in the digital age and emphasized that his client intends to contest the charges vigorously.
“This case is about more than just financial transfers,” said Vlasov’s lawyer, Sarah Chambers. “It touches on fundamental issues of jurisdiction, digital privacy, and the reach of sanctions enforcement in an increasingly decentralized financial world.”
The charges come amid growing international scrutiny over the use of cryptocurrencies to bypass sanctions, particularly following Russia’s full-scale invasion of Ukraine in February 2022. The UK, along with the US and EU, has imposed sweeping sanctions targeting Russian individuals, financial institutions, and entities associated with separatist movements in Ukraine.
Vlasov has been released on conditional bail, including restrictions on his internet use and financial activities. He must also surrender his passport and remain within the Greater London area until his next court appearance, scheduled for later this summer.
The case is expected to draw considerable attention as it progresses, particularly given its implications for how Western nations monitor and regulate the flow of digital currency in conflict zones. Photo by Edwin.images, Wikimedia commons.