(Bloomberg) -- The World Chess Federation said UBS Group AG will close its bank accounts with immediate effect, more than two years after long-time president Kirsan Ilyumzhinov was put on a sanctions list by the U.S.
"The white money strategy in Switzerland does not allow doing business with institutions or persons on the sanctions list of the U.S. Department of the Treasury," Adrian Siegel, the federation’s treasurer, said in a letter posted on its website on Tuesday. "Thus, it was only a question of time until we face this serious problem."
Russian-born Ilyumzhinov, added to the list in 2015 over alleged links to Syrian President Bashar al-Assad, has denied any such connections. He had informed the Federation, known as FIDE, on "various occasions" that he would soon be removed from the list, according to the letter. UBS closed the account when that didn’t happen, the treasurer said. FIDE is looking for a new bank and the issues resulting from the closure "severely damage" its business activities.
“We can’t comment on whether individuals or organizations are clients of UBS. We follow all laws and regulations that are applicable to us,” the Zurich-based bank said in a statement. A person answering the phone at FIDE’s office in Lausanne, Switzerland, declined to comment on the matter.
The Russian oligarch first headed FIDE in 1995 and was re-elected to another four-year term in 2014. However, in 2015 Ilyumzhinov was stripped of his financial, commercial and legal duties, with responsibilities handed over to Deputy President Georgios Makropoulos, according to the letter.
“In the process of this change we anticipate some problems,” Siegel said in the letter. “However, we will do our best that payments will not be delayed.”
A former politician from Russia’s Kalmykia region, Ilyumzhinov has long been a lightning rod for controversy. Before being put on the U.S. list, he had been photographed with Libya’s chess-playing leader Muammar Al-Gaddafi. He also claimed to have been abducted by aliens, German newspaper Suddeutsche Zeitung reported in December.
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