September 20, 2024

Greetings From Amsterdam, 

We’ve been on summer break, but we’re back with a new look — and there is a trove of crime and corruption news we’re keen to share. Let’s start with our deep dives.

New Investigations

In Cyprus, a creative new type of investment fund was launched as a way for clients to avoid revealing their ownership of assets. Think megayachts worth tens of millions, luxurious Moscow townhouses and apartments, and a $58-million share in a countryside resort. 

Known as registered alternative investment funds, or RAIFs, these funds were introduced by the Cypriot government in July 2018, just two months after the European Union began requiring member states to publish registries detailing the “ultimate beneficial owners” of companies. Our reporting documents how they were marketed by a sanctioned Cypriot lawyer — and managed by a company owned by his wife — specifically as a way to circumvent the crackdown on corporate secrecy.

Their pitch: By using RAIFs, clients’ could avoid having their names appear on the registry; instead, a fund manager’s name would take their place. 

Among the funds’ users? Andrei Kostin, the longtime head of Russia’s state-owned VTB bank, whose close ties to Vladimir Putin’s regime had previously earned him U.S. and EU sanctions. Our reporting found that in 2022, offshore companies that owned two yachts linked to Kostin were moved into Cypriot RAIFs — leaving no trace in Cyprus’ new public register of beneficial owners. 

Read the full story  

The reporting also revealed an apparent split in the Red Cross movement, with a local member — the Azerbaijani Red Crescent — enthusiastically toeing the Azerbaijani government line.

The violations began after Azerbaijan allowed a group of government-backed environmental activists to block the only road in or out of Nagorno-Karabakh in December 2022. The blockade led to widespread hunger and shortages of medical and other supplies, prompting the International Committee of the Red Cross (ICRC) to begin evacuating the neediest patients to Armenia in special convoys. 

In February 2023, the ICJ in the Hague ordered Azerbaijan to keep this passageway open. But our reporting reveals that new checkpoints, demands for advance copies of passengers’ passports, and route closures lasting days and weeks severely limited the Red Cross’s ability to operate.

The impact: Though some 1,500 people, including more than 800 patients, were transported by ICRC out of Nagorno-Karabakh during the nine-month blockade, sources tell us the need was likely twice that, and our reporting indicates that some patients died while awaiting evacuation. 

After nine months of siege,  Azerbaijani troops moved into Nagorno-Karabakh, which is considered Azerbaijani territory under international law. The entire Armenian population was forced to flee, and dozens reportedly died making the journey. The invasion was one of several government actions lauded by the Azerbaijan Red Crescent — one of 192 national-level humanitarian groups that make up the Red Cross network — in violation of Red Cross principles of impartiality, neutrality and unity. 

In response to its publication, the Azerbaijani government has accused the ICRC of siding with Armenia. 

Read the full story  

In Germany, investigative files shed new light on the work of police informant Aleksandar Kolundzic, who was brutally tortured and murdered in Spain in June 2022. 

The 33-year-old Serbian was valued by German police as a reliable informant, but he was also suspected of enabling major drug deals in the process. Prior to his death, he owed large amounts of drugs and money to associates, according to testimonies gathered by investigators. 

The findings raise questions about how much Kolundzic’s police handlers knew about their informant’s alleged criminal dealings or the security risks he faced. Yet some details may never be known: a few days after the murder, Kolundzic’s lead police handler in Germany reset his own mobile phone to factory settings, deleting his communications with the informant.

Read the full story here  

In Syria, falsified documents allowed at least 40 over-aged soccer players to compete in youth tournaments — and win titles — from 1989 to 2005, we found alongside our Syrian media partner, SIRAJ. 

Wins in which these players made significant contributions include: a run in the 1992 World Youth Championship; their victory in the under-20 Asian Cup in 1994; and a 2-1 win for Syria in the 2005 FIFA World Youth Championship. 

Falsified ages were so widespread in Syria’s national teams that the number of players with accurately recorded ages on a given squad “did not exceed the number of fingers on one hand,” said a former committee head. In the most egregious case, a player’s birth year was fudged by six years — making him well over 20 when he played goalkeeper for the 1991 under-20 squad. 

Read the full story here  

Global Crime and Corruption News

Turkey: From fatal public killings in Barcelona and Moldova to a drive-by shooting in London, a serious escalation of violence involving rival Turkish gangs is spilling into public spaces in cities throughout Europe. Officials and experts told OCCRP that this new wave of violence is likely being driven by a massive shortage in the supply of heroin — the main illegal commodity traded by Turkish gangs — due to the Taliban’s ban on opium cultivation in Afghanistan in 2022.

Georgia: Russian-style authoritarianism is taking hold in Georgia’s ruling party, experts said, after the controversial billionaire Bidzina Ivanishvili was tapped as its top parliamentary candidate. Ivanishvili founded the ruling Georgian Dream party and briefly served as prime minister after returning home from two decades in Russia in 2012. While he hasn’t held public office since then, he’s seen as an influential figure behind the scenes. 

The announcement of his return to politics comes amid other indications the party is choosing a Putin-style approach to politics. Georgian Dream has also proposed legislation that discriminates against the LGBT community, and passed a recent law cracking down on non-government organizations and independent media. 

Plus: Former Georgian head of financial police and defense minister Davit Kezerashvili is under investigation after he and two family members received more than $1 million in proceeds from a sprawling international call center scam exposed by OCCRP in 2020. The investigation involving law enforcement in Georgia and Germany comes a decade after Kezerashvili’s term ended. He is among four suspects, but has not been charged. He claims to be a victim of a smear campaign. 

United Kingdom: Mark Fullbrook, the chief of staff under former Conservative Prime Minister Liz Truss, has been lobbying for a London-based investment group part-owned by two sanctioned “pro-Kremlin” oligarchs since last year. Truss was the foreign secretary who announced the sanctions six months before her short term as prime minister. 

Fullbrook set up his firm following his work for Truss, and documents filed with the U.K. lobbying registry show he has worked with a subsidiary of the oligarchs’ company, LetterOne, since October 2023. A LetterOne spokesperson said the two men have no involvement in company affairs and derive no benefit. 

Sweden: In an “unprecedented” verdict overturning her previous acquittal, former Swedbank CEO Birgitte Bonnesen was sentenced to 15 months of prison. She was convicted for misleading and financially damaging statements about the bank’s poor anti-money laundering operations. 

Bonnesen’s statements were in response to questions that followed reporting by OCCRP and partners showing that hundreds of billions of dollars could have been laundered through Danske Bank’s operations in the Baltics. She denied to reporters that Swedbank had similar problems. But Swedish Television later reported that suspicious clients were pouring billions through the bank, which tanked Swedbank’s share price.

And finally, documents filed in a U.S. court last month help explain how we ended up on a 2022 list of “undesirable” organizations that could no longer work in Russia.

Buried deep in the court documents were text messages between an officer in Russia’s Federal Security Service (FSB) and the head of a Moscow-based NGO called the “Anti-Globalization Movement of Russia,” which the FSB allegedly used to spread disinformation. The messages sent in February 2022 — as the regime of Russian President Vladimir Putin responded to sanctions prompted by his invasion of Ukraine — showed the two men discussing OCCRP. 

Just two weeks after the exchange, OCCRP and media partners published the Russian Asset Tracker, which exposes the assets of oligarchs and officials accused of aiding Putin.

More next week. 

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