Londongrad: Has the "Cleanup" of "Russian" Assets Begun?

2024 Author: Seth Attwood | [email protected]. Last modified: 2023-12-16 15:55

This time the trap slammed shut completely

There was a threat of expropriation of the property of fugitives from Russia. Primarily their bank accounts. I have written many times that this event is as inevitable as the arrival of winter after summer. At the same time, I compared the giant British offshore with a mousetrap for oligarchs and smaller kleptomaniacs from Russia. But the onset of the "hour of truth" for them has accelerated due to the aggravation of relations between the West and Russia over the past year. This is evidenced by many events of the past two months.

Since the end of January, some UK banks have begun to require Russian businessmen to provide a detailed report on their property abroad and the origin of money. Russian businessman, founder of Euroset, Evgeny Chichvarkin, wrote about this on his Facebook page. “A few days ago, a letter came from our respected and very large British bank with the following content: Dear Mr. Chichvarkin, in connection with the sanctions against Russia, take the trouble to explain where you got your money, what assets you have, what is your fortune, how did you get these assets, how much investment do you have in the United Kingdom, and so on … As far as I understand, the bank's instruction is - if something goes wrong, to block accounts."

Mr. Chichvarkin further self-confidently declares in his letter that he will definitely be able to account for the origin of his money. Naive Chichvarkin! Already the seventh year of his emigration to Londongrad, he still did not understand how the English mousetrap works. Recall that Evgeny Chichvarkin left Russia in 2008 - shortly after it became known about the sale of Euroset to the investment company ANN, controlled by Russian financier Alexander Mamut. In Russia, Chichvarkin was put on the wanted list on charges of kidnapping and extortion, but later the criminal case against him was dropped. If necessary, the British Themis herself initiates a criminal case, abandoned halfway. And if the money of the former Russian businessman is not confiscated, then it will certainly freeze him.

At the beginning of February, almost all UK banks began to check the legitimacy of the income of their Russian clients, sending them en masse letters of demand. Bankers are asking Russians to explain where and how their funds were received, which are on accounts in British banks. Banking lawyers and employees of customer service departments explain to the Russians: if strong evidence of the legality of the receipt of income is not presented, then the accounts will be frozen, and this does not even require a court decision. But the account holder can only "unfreeze" the funds on the account and try to withdraw them outside the UK by a court decision.

Of course, cases of freezing and even confiscation of Russians' funds in foreign banks are not so rare. But so far, this has only happened after the judgment has been passed. One such case is the confiscation in Australia last year of the funds of nine Russians from Irkutsk at a local bank (in the city of Gold Coast in the Australian state of Queensland). According to the banking expert, they were involved in the money laundering process. The first accounts were opened in 2010. The balance on the accounts of Russian citizens unexpectedly increased thanks to international transfers from eight foreign companies from bank accounts of Hong Kong and the mainland of China. By December 2013, the Russians had opened 24 accounts, which held a total of about $ 30 million. The investigation and court hearings lasted for several months. British banks can now dispense with such legal formalities.

The situation for some of the account holders in the banks of Londongrad is aggravated by the fact that not only the legality of the origin of the money is now subject to verification, but also the connection of the account holder with those individuals and legal entities of the Russian Federation who were blacklisted in the West due to economic sanctions. If necessary, any connection can be proved, even if the account holder swears that he is an ideological fighter against the "Putin regime".

Last month, the first message about a specific case of a Western bank seizing funds from a Russian entrepreneur was reported. The oil entrepreneur received a request from the bank with the requirement to submit documents on the legal origin of the money, and in English. The entrepreneur provided tax returns, certificates and a bunch of other documents confirming the legality of receiving funds and the fact of paying taxes. Translation of documents and other overhead costs have cost the entrepreneur a pretty penny. The story dragged on for a long time, they demanded more and more information from the Russian, including personal data from school age.

Suddenly, the bank's lawyers put forward a version that the seals on the documents could have been forged. They found some kind of secondary document with a really forged seal, which was allegedly provided by the entrepreneur. This was the reason to declare all other documents invalid. The entrepreneur's arguments that it made no sense for him to forge some secondary paper did not have any effect. Everyone understood perfectly well that this was pure provocation. A provocation, which served as the basis for the bank to write off $ 5 million from the entrepreneur's account in favor of the state and in its own favor, and without a court decision. The information dated February 10 of this year contains either a conclusion, or advice, which is not very pleasant for our "money emigrants", or advice: "According to the lawyers, the court would also side with the bank, so it was not even worth spending money on litigation." …

Passions about Russian capital in London are further inflated by the British media and government departments. So, on March 11, British Foreign Minister Philip Hammond announced the possibility of publishing "interesting information" about the assets of the closest circle of Russian President Vladimir Putin in British territory in order to increase pressure on Moscow. The head of the Foreign Office noted that the British authorities are considering such a step as one of the possible ways to put pressure on Russia through strategic communications.

“When we say what further steps we can take to increase pressure on Russia, then from time to time we return to strategic communications: how can we turn to the Russians and to those whose opinion on what is happening (in Ukraine - V. K.) trying to influence Russia, "- explained the head of the British Foreign Office. If we translate the phrase "strategic communications" into an understandable language, then this is the impact of official London on the offshore aristocracy of Russian origin using the instrument of threats of confiscation of assets located in an offshore called "Londongrad". Impact aimed at achieving strategic goals in the current cold war with Moscow.

On the day of Hammond's announcement, the London branch of Deutsche Bank published a report on the scale of Russian investment in Britain. The division's specialists conducted a study of the statistics of the balance of payments of Great Britain and Russia. They came to the conclusion that tens of billions of dollars of "gray" capital from Russia have flowed to London over the past eight years. One of the authors of the report, Oliver Harvey, said: “Since 2006, almost $ 133 billion has been transferred to Britain. Since 2010, the rate of inflow has been about one and a half billion dollars per month. A significant part of these funds ended up in the real estate market. " The flow of "gray" money from Russia to the islands of Foggy Albion increased especially after the process of liquidating bank secrecy began in Switzerland in 2010. Switzerland has ceased to be a banking offshore for Russian kleptomaniacs, it was replaced by Great Britain.

The fact that the overwhelming part of capital from Russia to Great Britain is channeled through “shadow” channels can be judged from the official statistics of the Russian Federation (Table 1). According to Rosstat, at the beginning of 2013 the volume of accumulated Russian investments in Great Britain was only $ 9.1 billion, which was about 5% of all Russian assets accumulated abroad. These figures do not "beat" at all with the assessments of British experts and the assessments of Deutsche Bank specialists. Tab. 1. Investments from Russia abroad by countries-recipients of investments in 2013.

True, the picture changes significantly if, when assessing capital flows to the UK, we take into account not only the UK itself, but also the British Virgin Islands (BVI). These islands are the largest offshore in the world economy, which is under the rather strict tutelage of the financial and banking authorities of London. The United Kingdom and the BVO together accounted for almost $ 70 billion of accumulated Russian investments. Or almost 2/5 of all foreign assets of Russian origin. Note that the latest available data from Rosstat gives a picture of accumulated foreign investments as of January 1, 2013. And in the spring of the same year, there was a very serious "run over" to offshores, and the British Virgin Islands got the most.

There were powerful "leaks" of information about customers and accounts of the BVI, and the real customers and organizers of the then operation were not "figured out" to the end (See: Valentin Katasonov. Pogrom of offshore companies, or Operation Offshore leaks // FSK, 04.16.2013) … Whatever it was, but, according to experts, the operation to "clean up" the BVO led to the fact that very large capital of Russian origin was forced to move to Londongrad. And now a new series of "cleansing" of Russian assets begins. But it seems that this time the trap slammed shut completely. It seems that it was precisely this situation that Vladimir Putin warned Russian businessmen, oligarchs and officials about when he said that "you are tortured to run and swallow the dust." Someone heeded these warnings, while others continued to stubbornly believe in the independence of Western "justice", and now they may find themselves at a broken trough.

Valentin Katasonov