Russia's UK embassy denounces G7 loans to Ukraine as 'fraudulent scheme'

LONDON (Reuters) - The Russian embassy in London on Saturday described Britain's planned transfer to Ukraine of more than 2 billion pounds ($2.5 billion) backed by frozen Russian assets as a "fraudulent scheme".

Britain said in October it would lend Ukraine 2.26 billion pounds as part of a much larger loan from the Group of Seven nations backed by frozen Russian central bank assets to help buy weapons and rebuild damaged infrastructure.

The loans were agreed in July by leaders of the G7 - Britain, Canada, France, Germany, Italy, Japan and the U.S. - along with top officials from the European Union, where most of the Russian assets frozen as a result of the war are held.

"We are closely following UK authorities' efforts aimed at implementing a fraudulent scheme of expropriating incomes from Russian state assets 'frozen' in the EU," the Russian embassy in London said on social media.

British Defence Minister John Healey said the money would be solely for Ukraine's military and could be used to help develop drones capable of travelling further than some long-range missiles.

The embassy added: "The elaborate legislative choreography fails to conceal the illegitimate nature of this arrangement."

Russia's Foreign Ministry last week described the U.S. transfer to Ukraine of its share of the G7's $50 billion in loans as "simply robbery".

($1 = 0.7956 pounds)

(Reporting by Catarina Demony; Editing by Hugh Lawson)