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Police probe how sanctioned Russian tycoon moved £1 bln

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Cyprus police are investigating how an oligarch attempted to transfer a £1 bln stake in a travel firm on the day he was placed under EU sanctions, government insiders told the UK Guardian newspaper.

This follows revelations that local service providers appear to have played a key role in enabling Russian oligarchs to shield assets from EU sanctions within days of Moscow’s full-scale invasion of Ukraine.

President Nikos Christodoulides has vowed to respond decisively to the disclosures by a consortium of media partners, including the Guardian.

“No one is above the reputation of our country,” he told reporters after the publication of Cyprus Confidential, an eight-month global investigation examining about 3.6 mln documents leaked from financial service providers.

The government has insisted there would be “zero tolerance” for sanctions-busting, money laundering and other illegal practices.

The leak raised questions about the role played by service providers, including PwC Cyprus, in efforts by high-profile, ultra-wealthy Russian clients to outpace sanctions days after Putin launched his “special operation” in Ukraine.

They have come at a sensitive time for Cyprus, with the EU member state still reeling from US and UK sanctions slapped on an array of individuals and entities for enabling oligarchs to hide assets.

Christodoulides, who assumed office in March, was forced into damage control.

Washington and London urged Nicosia to take immediate measures to rein in the illicit support of Russians blocklisted by the West.

Asked about the investigation, the European economy commissioner, Paolo Gentiloni, told reporters: “I’ve been following the Cyprus Confidential papers very closely.”

He said the Commission was still studying the reports and would respond in detail in due course, while sources in the executive body said it was a “very serious” matter.

They have already been in touch with Cyprus authorities.

The leaked files suggest PwC Cyprus helped Russia’s “richest” oligarch, Alexei Mordashov, attempt to transfer a £1 bln stake in Tui, Europe’s largest travel company, on the day the tycoon was placed under EU sanctions.

The disclosure raises serious questions about the role played by the accountancy firm in a potential sanctions breach.

Cypriot government insiders told the Guardian that the financial crime squad of its police force is investigating the Tui transaction.

PwC and a spokesperson for Mordashov said they were unaware of any criminal investigation before the Guardian approached them.

In response to information in the leaked files, a spokesperson for the accounting firm said: “Any allegation of non-compliance with applicable laws and regulations is taken very seriously, investigated, and appropriate action is taken if necessary.”

The Guardian said it has “seen no evidence showing any intention to break any rules – and Mordashov’s spokesperson said the oligarch was not attempting to hide the share transfer or circumvent the law”. (source The Guardian)