The Consequences of Financial Crime in Cyprus: A Gateway to Dubious Transactions

Cyprus, long notorious as a tax haven and haven for Russian oligarchs, has been used as a conduit for laundering criminal money. A recent investigation by Le Monde and its partners reveals the devastating consequences of this situation.

The Investigation’s Findings

The investigation is based on leaked documents from six Cypriot financial services firms, including ConnectedSky, Cypcodirect Corporate Services, DJC Accountants, Kallias & Associates, MeritKapital, and MeritServus. The leaks were obtained by the International Consortium of Investigative Journalists, the Organized Crime and Corruption Reporting Project, and Paper Trail Media, with the support of Distributed Denial of Secrets.

• Russian Sanctioned Individuals: The investigation identified 96 Russian individuals sanctioned by the West since 2014 who have ties to at least 800 separate companies or trusts.
• Lax Financial Regulations: Despite repeated warnings from anti-money laundering authorities, the EU has failed to take action against Cyprus’s lax financial regulations. This has allowed shell companies to be registered on a large scale and Russian money to flow freely into the island.

The Consequences of Financial Crime

The investigation reveals that Cyprus has become a gateway for dubious financial transactions within the European Union (EU). The country’s economic model, based on its hypertrophied financial sector and close ties to Russia, has been used by Russian oligarchs to launder criminal money.

• Russian Oligarchs: The clients of these firms include some of Russia’s most powerful oligarchs, including Roman Abramovich, who has been linked to a vast offshore empire managed by the MeritServus cabinet.
• Auditing Giant PwC: The investigation also reveals that auditing giant PwC helped several Russian billionaires transfer assets and conduct “urgent” transactions just before they were placed under sanctions.

Conclusion

The consequences of financial crime in Cyprus are devastating, and the EU’s failure to address this issue is a stark reminder that the country’s economic model must be overhauled to prevent further abuse and protect the integrity of the financial system. The investigation’s findings raise serious questions about the consequences of financial crime in Cyprus and the need for urgent action to prevent further exploitation.

About the Investigation

The investigation was conducted by Le Monde and its partners, with support from the International Consortium of Investigative Journalists, the Organized Crime and Corruption Reporting Project, Paper Trail Media, and Distributed Denial of Secrets. The findings highlight the need for greater transparency and accountability in the financial sector to prevent further abuse and protect the integrity of the system.