Cyprus Cracks Down on Financial Crimes: responds to Allegations of Money Laundering and Tax Evasion by Russian Oligarchs

Background

• The European Union (EU) state of Cyprus announces tougher measures against financial crimes following an investigation revealing Russian oligarchs moved assets worth €32 billion through the country between 2010 and 2014 (Guardian, 2023)
• A significant portion of the funds originated from Russia and passed through Cyprus’ financial system, leading to accusations of money laundering and tax evasion

Investigation Details

• Largest ever financial data leak from Cyprus, conducted by various international media organizations and the Organized Crime and Corruption Reporting Project (OCCRP)
• €32 billion transferred between 2010 and 2014, raising concerns over Cyprus’ role in managing Russian fortunes

Government’s Response

• Introducing stricter regulations to prevent future transactions
  • Enhancing beneficial ownership register
  • Strengthening transparency in financial transactions
  • Increasing cooperation between financial regulators and law enforcement agencies

EU Commission’s Investigation

• Probe to assess current anti-money laundering and counter-terrorist financing frameworks’ effectiveness
• Identify potential shortcomings and recommended actions

Previous Concerns and International Pressure

• EU countries like Latvia, Estonia, and others faced similar concerns in recent years
• International pressure for transparency and stricter regulations in managing Russian fortunes and preventing financial crimes

Impact and Future Implications

• Attention focused on Cyprus’ progress in implementing new measures
• Shockwaves in the global financial sector
• Debate on collective European action against money laundering and tax evasion continues

Reporting: Simon Goodley, Rob Davies, Kate Connolly, Juliette Garside, and Helena Smith

Originally published: The Guardian, November 14, 2023