A team of U.S. financial crime experts has arrived in Cyprus to assist with a government probe into suspected Russian sanctions violations following ICIJ’s Cyprus Confidential investigation, a Cypriot official confirmed to local media.
The group reportedly consists of two dozen specialists from the Federal Bureau of Investigation and the Financial Crimes Enforcement Network, or FinCEN, the United States’ financial intelligence unit. “U.S. authorities are pouring a lot into this,” a sanctions expert familiar with the moves told ICIJ.
The intensifying U.S. interest in Cyprus sanctions cases follows a strong reaction from European lawmakers and others to the investigation by ICIJ and 68 media partners published in November. Based on a trove of more than 3.6 million leaked documents, Cyprus Confidential exposed how allies of Russian President Vladimir Putin have used Cyprus as a hideaway for billions of dollars of assets, including after Russia’s 2022 invasion of Ukraine.
The 3.6 million leaked files at the heart of the Cyprus Confidential investigation come from six financial services providers and a website company.
The providers are: ConnectedSky, Cypcodirect, DJC Accountants, Kallias & Associates, MeritKapital, and MeritServus in Cyprus. The MeritServus and MeritKapital records were obtained by Distributed Denial of Secrets. Leaked records from Cypcodirect, ConnectedSky and i-Cyprus were obtained by Paper Trail Media. In the case of Kallias & Associates, the documents were obtained from Distributed Denial of Secrets, which shared them with Paper Trail Media and ICIJ. DJC Accountants’ records were obtained by Distributed Denial of Secrets and shared by the Organized Crime and Corruption Reporting Project. The partner organizations shared all the leaked records in the project with ICIJ, which structured, stored and translated them from several languages before sharing them with journalists from around the world. Additional records came from Latvia-based Dataset SIA, which maintains the i-Cyprus website, through which it sells information about Cyprus companies, including Cyprus corporate registry documents.
ICIJ’s reporting focused on the island’s financial services professionals who specialize in creating secretive trusts and shell companies that allow the wealthy to move and hide money. The leaked documents revealed a flurry of transactions facilitated by Cyprus firms as oligarchs sought to shield their wealth from looming sanctions.
In response to the revelations, Cypriot President Nikos Christodoulides swiftly pledged his government would investigate “[everything] that has come to light,” and later confirmed he had sought input from overseas sanctions experts.
Christodoulides’ assurances did not allay the concerns of members of the European Parliament who last month slammed Cyprus for lax enforcement of sanctions against Russia and called for strengthened European Union anti-money laundering systems. One European lawmaker also demanded an investigation of the Cyprus arm of accounting giant PwC Cyprus, a key focus of ICIJ’s reporting.
The findings have also reverberated across Cyprus. On Nov. 20, Cypriot officials, including Attorney General George Savvides, met at the country’s presidential palace to discuss improving oversight of sanctions laws, according to the Cypriot daily Phileleftheros. Local media also reported that Savvides’ office has received complaints of sanctions violations in the “double digits.”
OVERVIEW
Cyprus ignores Russian atrocities, Western sanctions to shield vast wealth of Putin allies
Nov 14, 2023
SANCTIONS
As sanctions loomed, accounting giant PwC scrambled to keep powerful Russians a step ahead
Nov 14, 2023
IMPACT
Cypriot authorities face scrutiny over probe into Russian billionaire’s moves to dodge sanctions
Nov 28, 2023
Kyriakos Iordanou, the head of the Institute of Certified Public Accountants of Cyprus, an accounting industry trade association and regulator, told ICIJ that the organization was focused on addressing the issues highlighted in the Cyprus Confidential investigation.
Iordanou said that ICPAC has submitted 10 reports to Cyprus’ federal police over possible sanctions violations since the middle of 2022. Those included moves by Russian billionaire Alexey Mordashov to shield a $1.4 billion investment from EU sanctions, Iordanou said.
The deployment of the U.S. team to Cyprus came after the Cypriot president attended a thanksgiving gathering at the U.S. embassy, where he met with Julie Fisher, the U.S. ambassador to Cyprus, according to the Cyprus Mail newspaper.
Published by: icij.org
