Financial Crime World

Cyprus: A Haven for Money-Laundering and Corruption? New Leaks Reveal Alarming Ties to Russian Oligarchs and Sanctioned Entities

In an explosive expose, an international consortium of investigative journalism organizations has uncovered a web of corruption and money-laundering involving six Cypriot financial service providers. This collaboration, spearheaded by the International Consortium of Investigative Journalists (ICIJ) and Paper Trail Media, delved into a trove of 3.6 million secret files from the largest financial data leak in history.

The Investigation

The documents, which span from the mid-1990s to 2022, contained confidential background checks, organizational charts, financial statements, bank account applications, and emails. According to OCCRP, these records revealed that hundreds of millions of Euros in assets, belonging to anti-democratic actors, had been channeled through these Cypriot financial institutions.

Russian Oligarchs and Sanctioned Entities

Among the funds traced back to Russia were those belonging to Roman Abramovich, a Russian oligarch and former owner of Chelsea Football Club. Abramovich, currently under EU sanctions following Russia’s annexation of Crimea in 2014 and the full-scale invasion of Ukraine in 2022, is alleged to have hiddenhis assets in Cypriot financial institutions.

  • Roman Abramovich and Chelsea Football Club

    • The leaked documents indicate a secret $40m deal between Abramovich and two men reportedly close to President Vladimir Putin in 2010. Abramovich has previously denied any financial relationship with the Russian leader.
    • Allegations also suggest that Cypriot financial firms may have helped Abramovich circumvent football’s “financial fair play” rules.

  • Alexei Mordashov and PricewaterhouseCoopers (PwC) Cyprus

    • PwC Cyprus and other advisers allegedly aided one of Russia’s most influential oligarchs, Alexei Mordashov, in an attempt to transfer £1bn into a public company on the day he was placed under EU sanctions.
    • The Cypriot finance ministry has launched a criminal investigation into this matter.

Syrian Petroleum Company

The leaked documents are also said to contain detailed discussions between the Syrian Petroleum Company, controlled by the government of Bashar al-Assad, and a Cyprus-registered intermediary organization.

  • Syrian Petroleum Company and US-based Organization
    • Correspondence allegedly indicates negotiations for at least five transactions with a US-based organization between 2014 and 2019.
    • It is important to note that, in 2011, the US imposed a strict embargo on exports to Syria in response to the Syrian regime’s violent crackdown in the region. Syrian petroleum was explicitly named in the sanctions.

Response from the Cypriot Government

The government of Cyprus responded to these allegations, stating:

We have zero tolerance on matters concerning sanctions evasion and law violation.

The government emphasized its commitment to combating corruption and illicit finance, and implementing EU sanctions effectively to ensure transparency and accountability.