The founder of a grantmaking charity who was removed for ties to the Russian government has had his appeal rejected.
Vladimir Potanin, who founded the Potanin Foundation, was sanctioned by the UK government in 2022 following Russia’s invasion of Ukraine.
As part of an investigation into the foundation, the Charity Commission removed Potanin from his position as an “officer”, with the power to appoint trustees and alter the charity’s objects, in June 2023 and terminated his membership.
Potanin appealed the decision the following month but the first-tier tribunal has now upheld the commission’s ruling.
The tribunal panel, which heard the case in London in February and March last year, reached a unanimous decision “on all the relevant issues” this month.
It found that Potanin’s removal was necessary “to protect the charity’s property and its proper application”.
“Alternatives such as indefinite interim management or inaction pending a review of designation were either unviable or not in the charity’s best interests.”
After sweeping government sanctions on Russian-affiliated financiers, including Potanin, his dealings with the charity’s assets were banned.
“[This rendered] the charity unable to function unless protective measures were imposed,” the judgment reads.
It says Potanin’s failure to resign before being removed “amounted to misconduct or mismanagement” and that “his inaction facilitated the situation that jeopardised the charity’s ability to operate.”
The Foreign, Commonwealth & Development Office previously described Potanin as “Russia’s second richest man and key supporter of the Kremlin”.
Ongoing investigation
The Potanin Foundation was registered in 2006 with objects to “develop education and culture in Russia by supporting talent, initiative and innovation among students and arts professionals.”
It has a sister charity in Russia, the Vladimir Potanin Foundation, to which it awards grants.
The commission opened a statutory inquiry into the Potanin Foundation in June 2022 due to its position that individuals subject to UK financial sanctions cannot control a charity.
On 12 July 2022, it appointed Guy Hollander of Mazars as interim manager of the charity, to the exclusion of the trustees.
The charity’s Companies House listing shows that Potanin ceased to be a “person with significant control” on the day Hollander was appointed.
According to the commission’s website, the interim manager is still in place at the charity and the inquiry is ongoing.
The judgment states that Hollander has recommended that the charity should “wind down”, given its connections to Potanin.
In 2024, the charity reported an income of £2.5m, generated through returns on its more than £60m of investment assets, and expenditure of £441,000.
Civil Society has approached the commission for comment.
