A new data leak has revealed a secret network of shell companies that have funnelled billions of euros through the global banking system.
The documents reveal a number of irregularities about the origin of the cash and suggest that some of the transfers were attempts to conceal funds acquired by way of criminal activity – in other words, there were indications of money laundering risk factors.
The scheme was allegedly created by a group of Russian businessmen, some of whom are members of Russian President Vladimir Putin’s close inner circle.
The data leak contains evidence of money transfers as well as emails and corporate documents dating from 2005 to 2017. However the key part of the data trove concerns wire transfers from the Lithuanian banks Ūkio and Snora, which have since been shut down by local authorities.
The material was handed over to the Organized Crime and Corruption Reporting Project, OCCRP, an international consortium of investigative journalists, as well as the Lithuanian website 15min.lt. Yle’s investigative journalism team MOT is the only Finnish media organisation to have obtained the data.
Red flags should have been raised
The leaked documents indicate that at least 700 million euros -- part of it from suspicious transfers -- ended up in accounts held in Nordea banking group, and that some 200 million was transferred to accounts in Finland. Nordea’s customers also included hundreds of sham companies whose real owners are almost impossible to identify.
Current laws require banks to identify their customers and to determine the origin of suspicious funds. Risk factors include situations in which a company is clearly led by a ghost director or proxy.
MOT showed some of the leaked material to Pirjo Jukarainen, a researcher at the Police University College and docent at the University of Tampere. Jukarainen has also been involved in drafting a money laundering risk assessment report at the Police College.
"Wow! [This is] rather wild. There are certainly several instances here where alarm bells should have rung," Jukarainen said.
"According to the law a bank must know its customers, understand the background of the business and also track its operations constantly. This has obviously failed. No one should even do business with risk customers. If for example, you are not able to identify with any certainty the actual principles behind a complex corporate structure, then you should end the business," Jukarainen added.
Russian oligarch funded princely projects
In addition to Yle’s MOT team, 20 other international media organisations also had access to the data trove. The architect of the so-called "Troika laundromat" was said to be a reputable Russian oligarch, Ruben Vardanyan, who has supported projects for Britain’s Prince Charles.
According to The Guardian, which has also investigated the leaked material, between 2009 and 2011, Prince Charles’ charitable organisation received nearly 200,000 euros via a firm registered in the British Virgin Islands, a known tax haven.
The money was used for the restoration of a 1750s-built country manor in Scotland, known as Dumfries House. Prince Charles is known for his love of classic architecture. A spokesperson for the Prince told The Guardian that the monarch did not know the exact origin of the funds.
Odd transactions by Putin insiders
One of the individuals who appeared to have profited from the clandestine network was musician Sergei Roldugin, a childhood friend of Vladimir Putin.
Leaked documents indicate money transfers of more than 60 million euros from shell companies to Roldulgin, whose unusual wealth had previously been mentioned in the Panama Papers, a 2016 data leak.
Roldulgin did not respond to interview requests from the OCCRP.
Hundreds of millions from Nordea for real estate projects
Businessman Ruben Vardanyan had been the long-time head and a shareholder of the investment bank, Troika Dialog. A significant number of the shell companies mentioned in the leaked documents had been set up for customers of Troika Dialog.
Vardanyan admitted to investigative journalists that the bank he captained did not ask customers about the origin of their funds.
"I am not an angel. In Russia you either start a revolution, leave the country or cooperate. I cooperate," Vardanyan said in an interview with the OCCRP.
Vardanyan, who sold Troika Dialog to Sperbank has strong ties to Nordea: the Nordic financial institution has been a major financier of his real estate business.
The Nordics’ largest bank has granted loans totalling some 420 million euros to Vardanyan’s tax haven companies, information that came to light in the Paradise Papers data leak of 2017.
Nordea declined to be interviewed by MOT and said that it could not comment on information about its possible clients due to banking secrecy rules.