Russian official warns Russia will confiscate retail deposits if sanctions go too far

With Russian troops invading Ukraine, retail customers could lose their deposits if Western countries impose tough sanctions.

Nikolai Arefiev, a member of the Russian Communist Party and deputy head of the Duma's economic policy committee, said Russia's savings could be confiscated as a result of the sanctions.

In an interview with local news agency News.ru on Monday, Arefiev said the Russian government could confiscate people's deposits worth around 60 trillion rubles ($750 billion) if Western countries decide to block all foreign money in Russia.

"If all foreign funds are blocked, the government will have no choice but to confiscate the entire savings of the people, which is 60 trillion rubles, to resolve the situation," the official said, noting that Russia has more than $640 billion in gold and foreign exchange reserves.

He also mentioned that potential sanctions against Russia include a possible severance of ties with SWIFT and a ban on foreign exchange transactions.

Russian President Vladimir Putin officially announced a special military operation in Ukraine that could trigger a series of sanctions on Russia's largest banks, including state-backed Sberbank and VTB.

Sberbank erroneously issued a statement Thursday night saying it had been placed on the U.S. sanctions list, but later deleted the notice, saying the statement was false and was the result of a "website crash," according to local reports.

At the time of writing, Sberbank's website shows that Sberbank and all its systems are functioning normally, while customers and legal entities have full access to their funds and services.

"We are prepared for any developments in the situation and have various plans in place to safeguard our clients' funds, assets and interests are protected and to ensure the normal functioning of all our functions," the notice said.

On Thursday, Russia's foreign ministry announced that it would ensure a response to possible Western sanctions, saying: "There is no doubt that we will respond strongly to these sanctions, not necessarily in a symmetrical way, but the response will be well calibration and will not unaffect the United States."

The latest events have had a huge impact on Russian stock and cryptocurrency markets, with Bitcoin (BTC) briefly dipping below $35,000 for the first time since June 2021, according to CoinGecko. The total market capitalization fell below $1.7 trillion for the first time since last August.

According to FTX cryptocurrency exchange CEO Sam Bankman-Fried, the massive sell-off in the cryptocurrency and stock markets is "paying for the war."