Posts Tagged ‘courtney weaver’
US seeks to seize Russian criminal group’s real estate
US prosecutors are looking to seize New York property used by a Russian criminal organisation to launder funds derived from an elaborate $230m tax fraud, according to a complaint filed in a Manhattan court.
The civil action also seeks to impose money-laundering penalties on the companies set up by the organisation, whose members allegedly included corrupt Russian government officials, US Attorney Preet Bharara said.
“Today’s forfeiture action is a significant step towards uncovering and unwinding a complex money laundering scheme arising from a notorious foreign fraud,” Mr Bharara said on Tuesday in a statement.
“As alleged, a Russian criminal enterprise sought to launder some of its billions in ill-gotten roubles through the purchase of pricey Manhattan real estate. While New York is a world financial capital, it is not a safe haven for criminals seeking to hide their loot, no matter how and where their fraud took place.”
The $230m fraud was first uncovered by the late Sergei Magnitsky, a respected Russian lawyer who died in pre-trial detention in Moscow in 2009 shortly after making his whistleblowing allegations.
Prosecutors claim that members of the organisation stole the corporate identities of portfolio companies of the Hermitage Fund, a foreign investment fund operating in Russia, which were then used to make fraudulent claims for tax refunds through sham lawsuits. Officials at two Russian tax offices who were members of the organisation approved the disbursements.
Through a complex series of transfers through shell companies, $230m was laundered into numerous bank accounts in Russia and elsewhere, according to the civil complaint. A portion of the funds stolen from the Russian Treasury passed through a Cyprus-based property company Prevezon Holdings, which laundered the proceeds into Manhattan property including four luxury apartments and two high end commercial spaces, it is alleged.
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Russia convicts Magnitsky of tax evasion in posthumous trial
A Russian court has found deceased lawyer Sergei Magnitsky guilty of tax evasion, in a posthumous trial that has elicited widespread criticism in the west.
Magnitsky was convicted of tax evasion alongside his former client William Browder, the US-born chief executive of Hermitage Capital, who Russian authorities allege evaded about $17m in taxes.
Mr Browder, who lives in the UK and was tried in absentia, received a nine-year sentence. He has denied all charges against him. The judge closed the criminal case against Magnitsky but refused to rehabilitate him.
Sabine Leutheusser-Schnarrenberger, the German justice minister, condemned the verdict, saying on Twitter: “The conviction of the dead Magnitsky is further evidence of the Sovietisation of Russia.”
A spokesperson for Lady Ashton, the EU’s foreign policy chief, said the verdict “does not provide any answer to the real questions regarding the death of Mr Magnitsky”, adding that the EU would continue to raise the “disturbing” matter with the Russian government.
Magnitsky’s conviction comes almost four years after he died amid murky circumstances in a pre-trial detention centre after he had accused Russian police of complicity in a $230m tax fraud.
Mr Browder has used the subsequent years to launch an anti-corruption campaign in Magnitsky’s memory, and has been successful in his efforts to ban the officials he says were involved in Magnitsky’s death from travelling to the US or holding bank accounts there.
On Thursday Mr Browder condemned the verdict against his former lawyer. He told the Financial Times that with “the malicious pain” the trial had inflicted on Magnitsky’s family, President Vladimir Putin had “brought shame on Russia and firmly found himself a place in history for being the first western leader in a thousand years to prosecute a dead man”.
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Dead lawyer to go on trial in Russia
The posthumous trial of Sergei Magnitsky, a crusading lawyer who died in prison in 2009, is set to begin in Moscow on Monday. The trial is part of an effort by Russia’s government to push back against countries adopting blacklists similar to the Magnitsky law passed last December by the US.
As far as anyone can remember, it will be the first trial of a dead defendant in Russian, or Soviet, history and most expect a speedy conviction.
Bill Browder, the head of investment fund Hermitage Capital, and Mr Magnitsky’s former chief, says he believes the trial is connected to the passage last December of the Magnitsky law in the US, which imposes a visa blacklist and asset freezes on certain Russian officials accused of human rights violations.
Mr Browder recently began a campaign to promote similar laws in Europe, starting with a trip to Paris last week.
“This is just pure vindictive nastiness because they are trying to get some sort of conviction right away,” said Mr Browder. “They can then go around the world and say: ‘Look, you’re naming a law after a convicted criminal.’”
A representative of the prosecutor’s office said it had no additional comment. “The case materials explain everything. We have nothing additional to say.”
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Russian money streams through Cyprus
A new parking scheme appeared late last year in some congested Moscow neighbourhoods. Street signs advised Muscovites either to buy a ticket at a nearby machine or text their licence plate details to a number: 7757.
Evgeny Schultz, a Moscow blogger, took a closer look. It turned out that the number 7757 had been bought by a company registered just six months previously, which itself had been founded by two Cyprus-registered companies whose ownership was unclear.
One of the names on the registration documents was the same as that of a senior adviser to the city’s department of transport and communications, which oversees the parking programme.
“This could just be a massive coincidence, of course,” Mr Schulz said, with an unmistakable note of sarcasm.
The city has defended the scheme, saying “every kopek” goes into its budget. But the episode underlines the unique, pervasive and dubious role that Cyprus plays in Russia’s economy.
In June, Cyprus became the fifth country in the eurozone to request an international bailout after lenders got caught up in the debt restructuring of Greece’s banks. Seven months later, the island is still waiting for funding amid EU fears that the island is a haven for Russian dirty money. Such fears are particularly strong in Germany and will need to be assuaged if Berlin is to back a bailout.
Estimates of the size of Russia’s deposits in Cyprus range from €8bn, according to some experts, to up to €35bn, according to a German intelligence report cited in Der Spiegel magazine.
In 2011, Cyprus was the number-one destination for Russian money being sent abroad and the number-one direct investor in Russia, with more than $13bn in investments, according to Russia’s Central Bank.
“From an economic perspective, Russia and Cyprus are so intertwined, Cyprus could almost be another region of the Russian Federation,” said Steven Dashevsky, founder of Dashevsky & Partners, a Moscow investment company.
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