Filenews 19 April 2023
A series of reports on the ties of Russian oligarchs under sanctions due to ties with the Kremlin with a Cypriot company has been published by the British newspaper Guardian on its website. The newspaper also highlights the reactions of ICPAC and MOKAS while citing a government spokesman who states that the country's support for EU sanctions is "clear and unequivocal" and that cooperation with the respective authorities in Britain and the US is "exemplary and mutually beneficial".
He says that Cypriot persons under sanctions under natural and legal law are controlled by the competent Cypriot authorities.
One of the extensive reports refers to Konstantin Malofeyev, who is accused by the West of financing Russian separatists in eastern Ukraine. The so-called "Orthodox oligarch" because of his support for the Russian church was placed under EU and US sanctions in 2014 following the annexation of Crimea.
However, he reportedly continued for three years to be a client of Cypriot accounting and offshore services firm MeritServus, which allegedly helped, as an obvious shareholder, companies linked to Malofeyev to move money and issue loans, even in US dollars.
The company reportedly assisted in €35 million in transactions. and $2.5 million. He cut ties with the Russian oligarch in the spring of 2017.
The newspaper cites a series of documents leaked by MeritServus of accountant Dimitris Ioannidis, who was placed on the UK's sanctions list last week for links to Roman Abramovich.
The documents, dubbed "The Oligarchs' Files" by the Guardian and its affiliated Organised Crime and Corruption Reporting Programme, "will raise new concerns about financial controls in Cyprus, an EU member state that for years has facilitated the movement of Russian capital into Europe and beyond."
In a statement before the sanctions were imposed by London, the Cypriot company had rejected any accusation of money laundering or violation of sanctions laws. He added that he severed relations with Malofeyev as soon as he realized he was on a sanctions list, informing ICPAC and MOKAS, with the matter "resolved" with both organizations.
In an initial statement, ICPAC said that as soon as the case became known, it requested a full presentation of data from the company and in the end it was judged that the sanctions had not been violated. Following the imposition of sanctions against MeritServus, ICPAC said it would assess the situation and consider whether further action was needed.
MOKAS said it has no legal mandate to implement or supervise the implementation of sanctions.
A Cypriot government spokesman said the country's support for EU sanctions was "clear and unequivocal". He added that cooperation with the respective authorities in Britain and the US is "exemplary and mutually beneficial" and that Cypriot natural and legal persons under sanctions are controlled by the competent Cypriot authorities.
In a second article, the Guardian focuses on Mr. Ioannides and his professional and personal relationships with Roman Abramovich. The Cypriot chartered accountant was reportedly among the guests at a birthday party in September 2009 for the former manager of Chelsea, then a group owned by the Russian oligarch.
Staff at MeritServus reportedly used the codename "Mr. Blue" for the largest customer, likely the then-owner of Chelsea's Blues. The company's relationship with the Russian tycoon reportedly began in 2001 and included services to his associates.
The report then examines the relationship of Russian money with Cyprus, commenting that some describe the island as "Moscow in the Mediterranean".
Reference is made to Russian investments in Cyprus and the large Russian community of Limassol, but also to the use of "golden passports" by Russians.
Those responsible for implementing sanctions are "increasingly concerned about the role Cyprus has played – and may still play – in facilitating the movement of Russian capital."
