Before the outbreak of war in Ukraine, the banks of Cyprus they managed over 200 billion dollars of Russian capital. Today, following sanctions imposed by the European Union on Russia and its oligarchs, that figure is expected to be close to zero. But no. Because according to what emerges from the journalistic investigation Cyprus Confidential, Cyprus continues to play its role financial hub of Russia. Despite the war and despite the sanctions.
The investigation by the International Consortium of Investigative Journalists (ICIJ) involves 250 journalists from 55 countries, including Italy with the weekly L'Espresso. The reporters analyzed further 3,6 million documents from six law and tax firms in Cyprus revealing “a myriad of affairs that have so far been kept secret, which involve international figures from economics, politics, sport, television" and show "the maneuvers used to escape war sanctions, with enormous financial flows transferred anonymously through trust networks and offshore companies managed by Cyprus consultants,” writes l'Espresso.
Russian oligarchs: billions in Cyprus despite sanctions
The first sanctions against Russia and its oligarchs were imposed in 2014 after the annexation of Crimea and the first separatist conflict in Donbass. Then, after the invasion of Ukraine on Russia's part, the island's authorities have undertaken to apply the new sanctions established by the EU and to strengthen the existing ones.
Between saying and doing, however, there are half a billion dollars. In fact, the investigation reveals how the Cypriot studios (which however deny having violated the sanctions) continue to manage the money of well 96 oligarchs sanctioned, among which at least 25 have been subjected to international restrictions since 2014.
Among the firms involved, the most "prominent" is the one founded by the most important lawyer and politician in Cyprus, Nicos Anastasiades – who was President of the Republic from 2013 until the beginning of 2023 – and which is now managed by his daughters. Anastasiades' firm, in fact, would have purchased the fiduciary management of very rich anonymous companies which are controlled by Russian billionaires sanctioned for their links with the Putin regime.
The Russian oligarchs involved in the investigation: Abramovich is also there
The consortium's investigation starts from 1995 and extends until April 2022. According to what has been revealed, almost 800 international anonymous companies (trust and offshore) are headed by Russian oligarchs sanctioned since 2014. Among the 104 Russian billionaires surveyed by Forbes, at least 67 are clients of the Cyprus studios who not only run their own Cypriot companies, but also administer offshore companies with locations across the British Virgin Islands, Jersey, Panama, Dubai and other tax havens. Among the various customers, the investigation identified 44 "politically exposed persons". The best known is the Russian oligarch Roman Abramovich, former owner of Chelsea. From the latest revelations published today by L'Espresso it emerges that Abramovich is the owner of over 200 anonymous companies. “Some of these offshore companies – writes the weekly – were used to pay tens of millions to various people connected to the London team, without declaring Abramovich's role and without including those sums in the official budgets of Chelsea. According to the experts consulted by the Guardian journalists, those illegal payments suggest a systematic violation of the rules on the so-called financial fair play". Not only that, according to the BBC the documents would also reveal a link between the oligarch and two men nicknamed "wallets" of Russian President Vladimir Putin, Sergei Roldugin and Alexander Plekhov. It would be a $ 40 million deal achieved in 2010. It's a shame that Abramovich has always denied any connection, even of a financial nature, with Putin.
Among the names that emerged there are also Petr Aven, key shareholder of Russian private sector financial services giant Alfa Group; Alexey Mordashov, one of the largest steel industrialists and one of Russia's richest men, with an estimated net worth of nearly $21 billion; Rinat Akhmetov the richest man in Ukraine, with an estimated wealth of $5,7 billion, according to Forbes; Alexander Abramov e Alexander Frolov sanctioned by the United Kingdom and the European Union in 2022.
Oligarch Mordashov and the role of Pwc Cyprus
Global consultancy giants such as the also operate in Cyprus pwc, which has a local branch with more than a thousand employees. Cyprus Confidential shows that PWC's Cyprus office helped Mordashov transfer approximately one and a half billion euros to mysterious anonymous companies: "a very suspicious operation, because it appears to have been carried out on the same day in which the owner of Severstal - the Russian steel, energy and mining giant, which until a few years ago also controlled the former Lucchini of Piombino - was hit by international sanctions” – writes l'Espresso.
Then there are several reserved payments that also lead to Hubert Seipel, German journalist, writer and television personality, who for some years has been busy publicly defending the Moscow government and the figure of Vladimir Putin. Cyprus documents show that Seipel received two wire transfers, totaling 600 euros, between 2018 and 2019, from an offshore company secretly controlled by oligarch Mordashov.
Also involved were personalities of other nationalities who used anonymous companies based in Copro, including the former boxing champion Vitali Klitschko, twice elected mayor of Kiev, the former Austrian finance minister, Karl-Heinz Grasser, and a current member of the government of Equatorial Guinea.
