Abramovich sold Chelsea in 2022, after he was sanctioned by the UK government over Russia’s full-scale invasion of Ukraine.

The £2.5bn raised was meant to be used for humanitarian causes linked to the Ukraine war but it remains frozen in a UK bank account.

Labour ministers are coming under increasing pressure to meet Abramovich’s representatives or the members of the foundation that was set up to manage the funds.

The Foreign, Commonwealth and Development Office (FCDO) told the BBC its officials are in talks with Abramovich’s representatives.

But multiple sources said there have been no meetings between any Labour ministers and members of the foundation set up to oversee the funds since the general election last year.

Sources close to the foundation said there was a deadlock and a political decision by a minister is needed to negotiate and sign off an agreement that can break the impasse.

One source said: “For three years, the government has been saying it’s been working very hard to release the money. But they are not having meetings with the foundation. There has been no meeting with a minister since Labour took over, for example.”

The BBC understands the FCDO has acknowledged a request for a meeting between the foundation’s board and Foreign Secretary David Lammy.

Abramovich’s representatives did not wish to comment, but those with knowledge of the situation acknowledged little contact or progress had been made on releasing the funds under the four prime ministers to have held power since the sale of the club.

The issue has taken on new urgency after Prime Minister Sir Keir Starmer announced that part of the UK’s overseas aid budget was being diverted to defence. In 2024/25, the UK is sending £282m in aid to Ukraine.

The £2.5bn – and the interest accrued on the funds – would make up for some of money taken from the aid budget, which was £15.3bn in 2023.

Alison Griffin, of charity Save the Children, said: “This money has been sitting gathering dust – and interest – when it could and should have been spent helping the children of Ukraine cope with the horrors of a full-scale war that has lasted over three years.”

The delay in releasing the funds centres on a disagreement between the UK government and Abramovich’s lawyers.

Abramovich was granted a special licence to sell Chelsea, providing he could prove he would not benefit from the sale.

At the time, Abramovich said proceeds from the sale would be donated via a foundation “for the benefit of all victims of the war in Ukraine”, and his position has not changed.

Abramovich – a Russian billionaire who made his fortune in oil and gas – cannot access the £2.5bn under UK sanctions but the money still legally belongs to him.

He is alleged to have strong ties to Russian President Vladimir Putin, something he has denied.

Sources said Abramovich’s lawyers have insisted on using the money for all victims of the war in Ukraine including those outside the country, but the UK government has pushed back and argued the funds should only be spent on humanitarian efforts inside the war-torn country.

Portugal has also had a say in the matter because Abramovich has Portuguese citizenship and has been sanctioned by the EU.

The Portuguese authorities issued an exemption to the EU sanctions to allow the Chelsea funds to be used for “exclusively for humanitarian purposes in Ukraine”.

“The EU and the UK have worked closely together to ensure that the proceeds of this sale be used for humanitarian purposes in Ukraine, via a charitable organisation, in line with the conditions laid out in the derogation,” said Olof Gill, a Commission spokesperson for financial services.

“The conditions under which the sale was authorised by the Portuguese authorities and which was accepted by the UK authorities must be respected and cannot be changed retroactively.

“The humanitarian needs in Ukraine remain extremely high.”

Members of the foundation, which is headed by Mike Penrose, the former boss of Unicef UK and Norwegian diplomat Jan Egeland, met former Foreign Secretary David Cameron and his deputy Andrew Mitchell in the spring last year.

Those with knowledge of the situation said the outcome of the meeting left a positive impression that the stalemate could be ended by allowing some of the funds to be used on humanitarian causes outside Ukraine.

The BBC understands the former foreign secretary believed a workable solution was in progress and a statement of intent about how the funds would be used was being drawn up by the foundation.

Lord Cameron had spoken to the European Commission about the proposal and had sought buy-in from Downing Street to sign off the agreement.

But there was no resolution to the dispute before last year’s general election and there have been no meetings with any ministers since Labour took office.

The foundation has a plan ready to roll out immediately once the funds have been unlocked.

There have been talks about programmes to help orphans of Ukrainian soldiers and cover health, housing and education needs for those fleeing the war.

A report by a House of Lords committee last year said the government’s failure to release the funds to support Ukraine was “incomprehensible”.

This week, The Guardian reported ministers were preparing to take Abramovich to court to free up the money.

Meanwhile, western countries are using the interest on frozen Russian assets to help Ukraine and there is talk of seizing them.

An FCDO spokesperson said: “This government is working hard to ensure the proceeds from the sale of Chelsea FC reach humanitarian causes in Ukraine as quickly as possible.

“The proceeds are currently frozen in a UK bank account while a new independent foundation is established to manage and distribute the money.

“UK officials continue to hold discussions with Mr Abramovich’s representatives, experts and international partners, and we will double down on our efforts to reach a resolution.”

Leaked papers reveal investments worth $6bn (£4.7bn) were routed through companies in the British Virgin Islands (BVI). But evidence suggests they were managed from the UK, so should have been taxed there.

Some of the money that funded Chelsea FC when Mr Abramovich owned it can be traced back to companies involved in the scheme, the BBC and the Bureau of Investigative Journalism (TBIJ) also found.

The oligarch’s lawyers said he “always obtained independent expert professional tax and legal advice” and “acted in accordance with that advice”.

Mr Abramovich – who now reportedly divides his time between Istanbul, Tel Aviv and the Russian resort of Sochi – denies having any knowledge of or being personally responsible for any unpaid tax.

Joe Powell, a Labour MP who leads a Parliamentary group on fair taxation, called on HM Revenue and Customs to “urgently” investigate the case to recover what could be “very significant amounts of money that could be invested in public services”.

At the heart of the scheme was Eugene Shvidler, a former Chelsea FC director and a billionaire businessman in his own right, who is currently challenging the UK government’s decision to sanction him for his close links to Mr Abramovich.

Mr Shvidler moved to the USA after Russia’s invasion of Ukraine, but from 2004 until 2022 he lived in the UK, with properties in London and Surrey.

A tax expert told the BBC that evidence Mr Shvidler had been making strategic decisions on the investments while based in the UK, and not in the BVI, was “a pretty big smoking gun”, suggesting the companies should have been paying UK tax.

Lawyers for Mr Shvidler said the BBC was basing its reporting on “confidential business documents that present an incomplete picture” and had “drawn strong and erroneous conclusions as to Mr Shvidler’s conduct”.

They said “the structure of investments” was “the subject of very careful and detailed tax planning, undertaken and advised on by leading tax advisors”.

The scheme involving Mr Abramovich’s hedge fund investments was revealed in a huge leak of data that the BBC and the Bureau of Investigative Journalism have been examining for over a year – thousands of files and emails from a Cyprus-based company that administered Mr Abramovich’s global empire.

The BBC and its media partners, including The Guardian, have been reporting on the leaked files since 2023 as part of the International Consortium of Investigative Journalists’ Cyprus Confidential investigation. On Tuesday, we revealed how Mr Abramovich had dodged millions in VAT on the running costs of his yacht fleet.

The leaked data shows how Mr Abramovich invested a large part of the wealth he acquired in the 1990s through a corrupt deal – ploughing it into a company in the BVI called Keygrove Holdings Ltd.

A network of British Virgin Islands companies owned by Keygrove invested this money – up to $6bn (£4.8bn) between the late 1990s and early 2020s – into Western hedge funds, according to the leaked files.

These investments made the oligarch an estimated $3.8bn (£3.1bn) in profits over almost two decades. By making the investments through companies in the BVI, which does not levy tax on corporate profits, the scheme appears to be set up to ensure as little tax as possible was paid.

It is not unusual for businesses to legally avoid paying tax on their profits by making their investments from companies in tax havens. But the companies involved must be managed and controlled offshore where they are incorporated.

If an offshore company’s strategic decisions are being taken by someone in the UK, its profits could be taxed as if it were a UK company.

The leaked documents show how the directors of the BVI investment companies handed sweeping powers over them to Mr Shvidler, who was living in the UK and gained British citizenship in 2010.

The BBC has seen “general power of attorney” documents dated between 2004 and 2008, that gave him the “broadest possible powers” and “full power to do everything and anything” to investment companies in the BVI.

From 2008, Mr Shvidler appears to have acquired the power to direct the investments of Keygrove, which owned the BVI companies, through another company.

Millennium Capital Ventures Ltd, which was owned indirectly by Mr Shvidler’s wife and appointed him as a director in 2000, became Keygrove’s investment manager. It was assigned “full power and authority to supervise and direct” the investment of the assets, “all without prior consultation with client”.

Further evidence of Mr Shvidler’s crucial role in the investment decisions of the BVI companies emerged in a court case brought in September 2023 by the US Securities and Exchange Commission (SEC) against a New York firm called Concord Management.

The SEC filing says that Concord had only one client, since identified as Mr Abramovich. The company advised on investment decisions for the oligarch’s BVI companies.

It identifies a “longtime close associate” of Mr Abramovich, referred to as “Person B”, who “made investment decisions” for Mr Abramovich.

It says he was “the point of contact for receiving investment advice” and “for either deciding or communicating the decision whether to go forward with recommended transactions”.

Using the leaked documents, the BBC was able to identify “Person B” as Eugene Shvidler.

The evidence suggests Mr Shvidler was making the decisions described by the SEC, managing and controlling Mr Abramovich’s investments, from the UK rather than the BVI.

Tax expert Rita de le Feria told the BBC that evidence a UK resident, such as Mr Shvidler, was taking “strategic big decisions” on the hedge fund investments was a “clear indication” the huge profits should have been taxed by the UK.

“I think this is a pretty big smoking gun. That would be, again, strong evidence that the effective management of the company was not taking place in the BVI,” she said.

Mr Shvidler’s lawyers said there can be “no question of Mr Shvidler, either knowingly or negligently, being involved in an unlawful scheme to avoid paying tax”.

Lawyers for Mr Abramovich said that in addition to the advice he obtained over his tax affairs, he “expects that similar advice was sought” by those with responsibility for running companies related to him.

The leaked documents also reveal how large amounts of the untaxed profits from Mr Abramovich’s hedge fund investments passed through a network of the oligarch’s companies before flowing into Chelsea FC.

The hedge fund investments flowed back into his companies in the BVI and then into Keygrove, their parent company.

Keygrove then loaned out money to other companies in Mr Abramovich’s network, which in turn lent money to Camberley International Investments Ltd – a company set up to bankroll Chelsea FC.

By 2021, when Chelsea won the Champions League, Club World Cup and UEFA Super Cup, hundreds of millions of dollars in loans to the club could be traced back to companies benefiting from Mr Abramovich’s untaxed hedge fund investments.

If HMRC were to investigate, how much could Mr Abramovich or the companies concerned owe?

We have assessed the profits made by the investment companies in the BVI from 1999 to 2018.

The leaked documents only contain complete accounts for the companies investing in hedge funds from 2013 to 2018.

But we can estimate how much money the companies involved were likely to have made over the entire period by looking at their “revenue reserves”. These are profits kept in the businesses, rather than being paid out to shareholders. By the end of 2018 this amounted to $3.8bn.

Applying historical UK corporation tax and currency conversion rates to the revenue reserves up to 2012, and the yearly profits to 2018, amounts to a potential tax bill of more than £500m owed to HMRC.

But in the event of an enquiry into unpaid tax, HMRC can also impose late payment interest and penalties for failure to notify the authorities.

If tax has gone unpaid, then depending on whether an investigation concluded those responsible knew but did not tell HMRC, or whether they did not know, the total amount due could range from almost £700m to over £1bn.

There is a possibility that some tax on the profits could not be recovered, as HMRC investigations can only go back a maximum of 20 years.

However, our calculations are also likely to be an underestimate, because we have applied the lowest rate of corporation tax that existed between 1999 and 2012, and it is possible profits had been extracted from the companies in that period that we have not included in our sums.

In any event, Mr Abramovich’s tax bill could dwarf the £653m bill imposed on Formula One boss Bernie Ecclestone in 2023.

Following Russia’s full-scale invasion of Ukraine, the British government allowed Roman Abramovich to sell Chelsea FC to Todd Boehly. It did so on the condition that £2.5bn from the proceeds would be donated to charities supporting victims of the war in Ukraine.

Nearly three years later, the money still sits in a frozen Barclays bank account, reportedly due to disagreement over how it should be spent, with Mr Abramovich wanting the money to go to “all the victims” of the war, and the UK government insisting it should be spent solely on humanitarian aid in Ukraine.

The BBC’s investigation suggests that, just as Ukrainians are waiting for money from the former Chelsea boss, so is the British taxpayer.

And yet photographs from Christmas Day that year show Mr Abramovich in the Caribbean sunshine, standing on the swim platform at the rear of the yacht, with Eclipse’s large letter-E logo behind him.

Charter records such as this were part of a decade-long scheme to mislead tax authorities, now uncovered in an investigation by the BBC and the Bureau of Investigative Journalism.

The scheme falsely presented the Russian oligarch’s fleet of yachts as a commercial leasing operation, to dodge millions of euros in VAT on their purchase and running costs.

“There has been tax evasion,” Italian tax lawyer and professor Tommaso Di Tanno told the BBC. “This is criminal.”

In a statement, lawyers for Mr Abramovich – who now reportedly divides his time between Istanbul, Tel Aviv and the Russian resort of Sochi – said he had “always obtained independent expert professional tax and legal advice” and “acted in accordance” with it.

The billionaire, who was sanctioned by the UK in March 2022 over his connection to Vladimir Putin’s regime, bought five luxury yachts over the course of the 2000s that were involved in the tax scheme.

Among them was the 115m (377ft) Pelorus, which he reportedly lent to Chelsea footballer John Terry for his honeymoon in 2007 – and Eclipse, which at 162.5m (533ft) was once the largest private yacht in the world and worth an estimated $700m (£559m).

aThe scheme to dodge tax on the yachts – and other secrets of the sanctioned oligarch’s corporate empire – is laid bare in over 400,000 files and 72,000 emails leaked from a Cypriot corporate service provider, MeritServus.

They show how MeritServus administered the oligarch’s businesses through a global network of companies owned by a series of trusts of which Mr Abramovich was the beneficiary.

The BBC and its media partners, including the Guardian, have been reporting on the leaked files since 2023 as part of the International Consortium of Investigative Journalists’ Cyprus Confidential investigation. We previously revealed Mr Abramovich’s financial links to one of Mr Putin’s closest associates, accused of holding the president’s wealth.

The files reveal how Mr Abramovich’s advisers helped him avoid paying huge tax bills on the yachts’ running costs in EU waters by using companies to hire them out to himself or other companies he controlled.

Documents show how the five yachts were leased to a company in Cyprus called Blue Ocean Yacht Management, which chartered them on to a handful of companies in the British Virgin Islands that appeared independent – but which were all in fact controlled by Mr Abramovich.

The scheme to dodge VAT in Cyprus was set out in a revealing 2005 memorandum on the proposed “Operating Structure” for the management of Mr Abramovich’s yachts.

“We want to avoid paying VAT on the purchase price of the yachts and where possible to avoid paying VAT on goods and services provided to the yachts,” wrote the memo’s author, Jonathan Holloway, then a director of Blue Ocean.

Although Blue Ocean and the companies hiring the yachts were all owned by Mr Abramovich’s trusts, they were intended to appear unconnected “so that an investigator checking on our operation would see it as a legitimate structure”, Mr Holloway wrote in the memo he sent to some of Mr Abramovich’s closest associates.

Mr Holloway warned them they should be “aware of the risks”. He wrote: “We all have to recognise that a determined investigator could eventually discover this is an in-house structure with the possible consequences that would entail.”

Mr Holloway wrote that Blue Ocean, the companies to which it leased the yachts, and the ultimate “customer” should not have the same shareholders, directors or registered addresses, to avoid any “common link” that might arouse suspicion.

As the memo noted, Mr Abramovich’s lawyer had agreed to put the ownership of Blue Ocean into an entirely separate trust – apparently distancing it from the other companies.

Sure enough, ownership of the yacht management company Blue Ocean was subsequently transferred from the oligarch’s main trust to a new one, the Neptune Trust.

The way Mr Abramovich’s companies leased the yachts to each other, Prof Di Tanno told the BBC, was an “artificial structure” that evaded tax – a criminal offence.

“My conclusion is that in the case, there has been a tax evasion… because all the parties know exactly what to do in order to hide the reality,” he said.

Tax expert Rita de la Feria told the BBC she had seen in the yacht scheme “indications” that they “may be misrepresenting information”.

“If that is the case, then we are now in the realm of evasion,” she added.

Mr Holloway, who stepped down as a director of Blue Ocean about 15 years ago, told the BBC that he “joined Blue Ocean 20 years ago and was there for a relatively short period of time”.

He said he had “managed literally hundreds of vessels from many different locations around the world”. “I can’t be expected to remember the individual circumstances of every vessel I have ever managed,” he said, adding that he “used structures others in the industry were using”.

Lawyers representing Mr Abramovich told the BBC he denied “any allegation that he had any knowledge” or was “personally responsible” or liable for “any alleged deception of any government authority” to evade tax.

His lawyers said that just as Mr Abramovich sought professional legal and tax advice and acted on it, he expects that “similar advice was sought at the relevant times by those with responsibility for the day-to-day running” of the companies involved in the scheme.

If this were a real superyacht leasing business, substantial profits might be expected. However Blue Ocean’s accounts show that from 2005 to 2012, its expenses almost matched its income.

This meant almost no corporation tax was due as the company’s profits were tiny.

A note from the Blue Ocean director suggests the close matching of expenses and income was no accident and the company would generate charters when the scheme needed to cover expenses.

“At the beginning of each week we will have a meeting in Blue Ocean where we will look at our current bank balances and our cash needs for the next 1~2 weeks [sic]. If we see a need for a cash injection we will raise an appropriate time charter and invoices,” he wrote.

There is also evidence in the leaked files that charter agreements were backdated. This includes a time charter agreement supposedly signed in July 2005 by Blue Ocean and another Abramovich company in the BVI called Eyke Services. However, records show Eyke Services did not exist at that point – it was not incorporated until a month later.

In another case, a director of Blue Ocean requested the production of a backdated and signed time charter in order to obtain delivery of duty-free fuel for Mr Abramovich’s 86m (282ft) yacht Ecstasea – which could accommodate 15 guests in eight suites – saving the billionaire $44,000 (£35,000) in tax.

In the documents, tax consultants from Deloitte in Cyprus wrote to Mr Holloway, the Blue Ocean director, saying if the ships were pleasure vessels, they would have to pay VAT. But if the vessels were classified as commercial, they would not.

A leading superyacht lawyer Benjamin Maltby told the BBC the type of contracts used for many of Mr Abramovich’s luxury yacht charters were actually designed for commercial ships carrying dry cargos such as grain or steel.

This gives us more evidence that the whole commercial “look” of the operation was a sham.

Mr Abramovich’s superyacht scheme came under legal scrutiny twice, with varying levels of success, the BBC and Bureau of Investigative Journalism has learned.

Richard Bridge captained two of Mr Abramovich’s yachts for almost six years from 2006 to 2012, including the Pelorus, and the giant Eclipse, the pride of Abramovich’s fleet. A couple of years after he finished working for Mr Abramovich, the captain was stopped and questioned at Amsterdam’s Schipol Airport.

Italian prosecutors had started proceedings against three of Mr Abramovich’s captains – including Mr Bridge – for unpaid excise duties on refuelling and tax evasion.

But Mr Bridge told the BBC he had contacted Blue Ocean and “their lawyers got onto it”, telling him a few months later the case had been dropped.

Italian court records seen by the BBC show proceedings were halted after the lawyers “produced documentation” proving Pelorus was “entered in the registers as a commercial boat as it is used for commercial purposes or for hire”.

Mr Bridge said he was unaware Mr Abramovich also controlled the companies that were chartering the yachts.

In Cyprus, tax officials were separately investigating Blue Ocean over up to €17m (£14.3m) in unpaid VAT, disputing the company’s claim to be “zero-rated” for VAT because it was a commercial operation.

Blue Ocean’s lawyers said demands to provide evidence the vessels had been used commercially by the companies chartering them were “unreasonable and oppressive”, but they had asked its clients anyway and received no response.

We now know that Blue Ocean’s clients were, of course, Mr Abramovich’s other companies.

According to an appeal judgement in 2018, VAT investigators found Blue Ocean had failed to present any evidence the companies chartering the yachts were “engaged in economic activity” and its claim that the boats were used for commercial purposes was rejected.

In the end, Cyprus pursued Blue Ocean for the lower figure of €14m (£11.8m).

We do not know if the sum was paid – the company failed to attend its own appeal in March 2024 and was dissolved four months later.