Moldovan Laundry: from Russia withdraw $20 billion

Moldovan Laundry: from Russia withdraw $20 billion


On 20 March the international centre for the study of corruption and organized crime (OCCRP) and “Novaya Gazeta” published new journalistic investigation into the alleged laundering of Russian money through Moldova and Latvia, which they called “Laundromat service to our” (English “Laundry”). The scheme operated from at least 2011 to 2014, and during that time, according to OCCRP, were withdrawn from Russia about $21 billion (700 billion rubles at the average exchange rate of those years).

When I learned about this scheme?

In 2014 OCCRP and Novaya Gazeta wrote about “Laundromat service to our” calling it the largest in the history of the CIS operation for the laundering of criminal proceeds. Then the journalists published laundered in four years, the amount ($20 billion), the outlined scheme, which employed the alleged fraud (fictitious loan agreements between foreign companies, pacifiers, Russian and Moldovan guarantors “forced” to repay a nonexistent loan), and called the main participants in the fraud — by Moldindconbank and the Latvian Trasta Komercbanka.

Did you learn something new journalists?

In “Laundromat service to our” money got from different sources: public contracts in Russia (corruption through overpricing), theft of assets in Russian banks with revoked licenses, possible tax evasion, say investigators. Scrolled through the “Laundry” money could be used to purchase goods and services from companies such as Samsung and Ericsson, and even funding Pro-Russian organizations in Eastern Europe. The money derived from Russia, were transferred to accounts in the Bank 732 in 96 countries, they have received more than 5 thousand companies from different jurisdictions — the US and South Africa to China and Australia, writes “Novaya Gazeta”.

The publication also claims that even found a few real beneficiaries of the “Moldovan” schema ultimate recipient of the money (although in reality, users of the scheme could be hundreds of people and companies). This businessman Alexey Krapivin, whose companies are the contractors of Railways (he had not responded to the request of “Novaya Gazeta”), the owner of IT of the group “LANIT” George gens and co-owner of IT-holding “marvel” Sergey Garden. The representative of “Lanita” said gens has nothing to do with “Moldovan scheme,” but a representative of marvel said that in any of the documents referenced in “Novaya Gazeta”, not seen and for that reason to comment on anything can’t.

Company Krapivina and its partners, the largest contractors of Railways, according to “Novaya Gazeta”, the father Krapivina was previously adviser to the former head of Russian Railways Vladimir Yakunin. The procurement activities of Railways carried out in strict accordance with the current legislation, said the representative of the monopoly in response to the request , most of the contests are held electronically and published on the website of Russian Railways, competitive procedures always undergo multilevel checks and repeatedly audiofiles.

Where did they get new information?

An anonymous source has provided OCCRP two arrays of Bank transactions: in the first specification of money transfers by Moldindconbank and from it, the second contains data on transfers to the Latvian Trasta Komercbanka, through which passed two-thirds of all laundered Russian money after transit through Moldova. Based on the data provided by an anonymous source, investigators have examined over 75 thousand Bank transactions.

Moldindconbank branch in Chisinau

Photo: Gleb Garanich / Reuters

As he worked the scheme?

OCCRP describes the scheme this way: two foreign companies-dummy, secretly controlled by Russian money launderers, to sign a bogus loan agreement (in reality, no money to the borrower not transferred). Guarantors on the debt are a Russian company and necessarily the citizen of Moldova. One of the parties to the contract can not pay the debt, “creditor” puts demands to the guarantor. Since the transaction includes a citizen of Moldova, the Moldovan case is referred to court, where the “corrupt judge” issues an official order requiring the company to pay the debt. The court shall appoint a bailiff, who is also a part of a fraudulent scheme, and that opens an account in Moldindconbank, where the Russian company transfers money, paying off a nonexistent debt.

“Novaya Gazeta” cites the example of the investigation: in January 2011, the UK company Valemont Properties Ltd allegedly purchased a promissory note with par value of $400 million from another company from great Britain Goldbridge Trading Ltd. The surety on the bill were several companies from Russia (including LLC “Legat” nominee Director — a pensioner from Moscow) and a citizen of Moldova Maxim Mexicain. When it came time to pay the bill, all taxpayers reported that they recognize the debt, but they have no money. And then the company Valemont Properties in April 2012 appealed to the court of Chisinau. The role of the citizen of Moldova was to ensure Moldovan jurisdiction where the organizers of the scheme was a good touch. The main purpose was to obtain legal justification for the withdrawal of money from Russia, the newspaper notes.

Where the money goes?

In the study “Moldovan scheme” was attended by journalists from 32 countries. Each edition, in addition to the description of the operation principle of “Laundromat”, told about involvement in the scheme of corporations out of their country.

For example, in Germany, the Süddeutsche Zeitung journalists counted $66.5 million of dirty money passing through German banks. Almost 80% of this amount passed through Deutsche Bank and Commerzbank, the country’s largest banks, which had previously been implicated in the scandal around the “Panamanian archive”.

In neighboring Austria, the journalists Dossier found in the database “Landromat” 32 recipients of “suspicious transaction”, which for several years were transferred $5.4 million. Among them, in addition to hotels, private schools and factories, is also an elderly couple living in the village near Vienna. In 2013, they received €52.7 K for some “consulting services”.

Journalists of the Polish Newsweek drew attention to the fact that one of the recipients of payments under the “Laundromat” was a Polish analytical organization “European center of geopolitical analysis” (ECAG). In may 2013 she received from Cypriot companies-dummy €21 million for “consulting services.” ECAG is headed by far-right politician Mateusz Piskorski. Previously wrote about the fact that he is one of many European radicals occupying the openly Pro-Russian stance. Piskorski repeatedly visited the Crimea, worked as an observer at the Crimean referendum in March 2014, appeared as an expert on TV channel RT. In may 2016, he was arrested by the Polish secret service as a “Russian spy” and is still in custody.

Mateusz Piskorski

Photo: partia-zmiana.pl

One of the most important members of the scheme became British banks. And through the branches actually it was only about $30 million “suspicious transactions”, whereas British banks were involved in laundering at least $738 million, stresses The Guardian. For example, more than $545 million passed through the Bank HSBC, the bulk of this amount through a branch in Hong Kong.

Not all national publications, cooperating in the framework of investigations with OCCRP, have published their materials. For example, the investigation is not yet written Finnish Yle and the Latvian Re: Baltica. “We do not interfere in editorial policy, each issue publishes materials when deemed necessary, we just give them the materials,” said OCCRP Executive Director Paul Radu, a Romanian investigative journalist. According to the Rada in the near future we can expect more publications on corruption schemes in the PRC and Hong Kong. Through each of these countries (Hong Kong and has a broad financial and economic autonomy from Beijing) passed over $900 million in “suspicious transactions” under the “Landromat”. Together it is even more than the leader of the list is Russia ($1.5 billion of laundered money).

What Russian banks included in the investigation?

According to participants of investigation by the “Novaya Gazeta”, in the scheme of a conclusion of criminal cash abroad were 18 Russian banks, 15 of which in the period from 2013 to 2016 has been revoked license. As told to the journalist “the New newspaper” Roman Anin, in the transfer of money to Moldindconbank was seen, in particular, Bank “Strategy” Intercapital-Bank, First Czech-Russian Bank, Incredbank, “European Express”, MBFI, “Unicore”, “Rublevsky”, “Russian financial Alliance”, Smartbank (until autumn 2011 BUT Bank) and mast-Bank. According to the materials of publication, the highest amount of money was transferred to Moldova in two Bank Russian land Bank and Bank “Western”, at the time of committing the suspicious transaction belonged to the banker Alexander Grigoriev. He was subsequently arrested on suspicion of organizing a criminal community for illegal cashing and cash withdrawals abroad volume of about $50 billion, stated by representatives of the Ministry of interior.

In the international investigation appeared another Russian Bank RosEvroBank, which is in contrast to the above performed the role of the receiving Bank, that is, through him the money was returned to Russia after the completion of the offshore schemes. The representative of the Bank included in the top 50 by assets, has denied the information on participation in “Moldovan.” “The mention of our Bank in the publication “Novaya Gazeta” was a complete surprise to us, we don’t understand, what does all this have to us. RosEvroBank works in strict accordance with the legislation of the Russian Federation and requirements of the Bank of Russia”, — said the representative of RosEvroBank.

The Central Bank and the Federal financial monitoring service has not responded to the request .

What is the role of the import goods to Russia?

A large part taken out of Russia funds — money received from gray imports, writes “Novaya Gazeta”. The publication illustrates this theory with examples obtained through Bank transactions, and unnamed businessmen, “which imported various goods in Russia”. The scheme, as of the publication is as follows: customs officials create impossible conditions for import of goods to Russia, from-for what businessmen have imported goods through a forwarding company, often associated with by the same officials. For its services, the middlemen are taking 30-40% of the value of the cargo, the newspaper notes, while “all imported transactions were carried out through bogus companies that did not pay taxes and customs duties” (these firms received money for fictitious decisions by Moldovan judges).

Photo: Maxim Shemetov / TASS

The problem of gray imports even wider, says the Chairman of the coordinating Council of the state Duma on the optimization of foreign trade flows, the former Deputy Mikhail Bryachak. Customs service directs consistently to the budget of 2.5 trillion a year less than it should, he believes, be seen when comparing the data of the FCS, the Central Bank and the United Nations. “It is obvious that such volume loss could not happen without the participation of the senior management service, night backpacks in this volume of goods concealed from customs control is impossible, he says. — As a result, the money appeared in the hands of corrupt officials and unscrupulous participants of foreign economic activity, naturally derived [from Russia]”.

Scheme, forcing the company to cooperate with forwarders exist, confirms the President of the Russian grain Union Arkady Zlochevskiy. “The information I received not once over the years, from various sources, that the importers squeeze a huge Commission on these schemes. Scheme-the corruption,” he says. However, now the extent of undervaluation of imports declined significantly, the share of grey import could reach 25-30%, now it dropped to 5%, says a leading expert of the Institute “development Center” HSE Sergey Pukhov.

sent a request to the press service of the FCS and is awaiting a response.

Where investigations are ongoing?

Public statements about the investigation of this scheme was only Moldavian, Latvian and Estonian officials, in particular, the President of Moldova Igor Dodon, the representatives of the economic police of Latvia and the criminal police of Estonia. The authorities of Russia and the UK, the banks which are associated with money laundering, did not confirm the information about the investigation.

“These are serious accusations, and we will investigate all reports, which will be available in our disposal”, — it is spoken in arrived in the statement of the representative of the Inspectorate for control over the financial activities of the UK Financial Conduct Authority (FCA). Bureau UK fraud in especially large sizes (Serious Fraud Office, SFO) in response for the request has not confirmed nor denied information about the interest in this case. According to the representative of the SFO, the following statements are made in three instances: when the company receives notification of the beginning of the investigation and considers it necessary to inform the market; when the investigation seeks to obtain information from victims; when companies officially been charged.

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