Billionaire Arkady Rotenberg ‘laundered millions’ through Barclays
One of Vladimir Putin's closest friends may have used Barclays Bank in London to launder money and dodge sanctions, leaked documents suggest.
Billionaire Arkady Rotenberg has known the Russian president
since childhood.
Financial restrictions, or sanctions, were imposed on Mr
Rotenberg by the US and the EU in 2014, which means Western banks could face
serious consequences for doing business with him.
Barclays says it met all its legal and regulatory duties.
A leak of confidential files - banks' "suspicious
activity reports" - reveal how companies believed to be controlled by Mr
Rotenberg kept the secret accounts.
The documents, known as the FinCEN Files, have been seen by
the BBC's Panorama programme.
In March 2014 the US hit Russia with economic sanctions
following the annexation of Crimea in Ukraine.
The Treasury Department designated Mr Rotenberg, 68, and his
brother Boris, 63, "members of the Russian leadership's inner
circle".
The pair had sparred and trained in the same judo gym as
Putin when they were young.
In recent years, Arkady Rotenberg's companies built roads, a
gas pipeline and a power station through contracts awarded by the Russian
state.
The US Treasury said the brothers "provided support to
Putin's pet projects" and "made billions of dollars in contracts for
Gazprom and the Sochi Winter Olympics awarded to them by Putin".
In 2018, the US added Arkady Rotenberg's son Igor to its
list of sanctioned individuals.
The aim of the sanctions is to cut off named people from the
entire Western financial system.
Yet the Rotenbergs appear to have continued moving cash
through the UK and US.
In 2008, Barclays opened an account for a company called
Advantage Alliance.
The leaked documents show the company moved £60m between
2012 and 2016. Many of the transactions occurred after the Rotenberg brothers
had been sanctioned.
In July this year, an investigation by the US Senate accused
the Rotenbergs of using secretive purchases of expensive art to evade sanctions
- one of the companies involved in the scheme was Advantage Alliance.
US investigators concluded there was strong evidence that
Advantage Alliance was owned by Arkady Rotenberg, and that the company had used
its Barclays account in London to buy millions of dollars of art for him.
A report noted how "secrecy, anonymity, and a lack of
regulation create an environment ripe for laundering money and evading
sanctions". Auction houses in the US and UK "failed to ask basic
questions" about the buyers of the art.
Despite the sanctions, Arkady appears to have paid $7.5m to
acquire the René Magritte painting La Poitrine.
In 17 June 2014 a company linked to Arkady sent the cash
from Moscow to Alliance's Barclays account in London. The following day
Barclays sent the cash to the seller in New York.
In April 2016, Barclays began an internal investigation of
multiple accounts it suspected of being linked to the Rotenbergs.
Six months later, the bank closed Advantage's account after
becoming concerned that it was being used to move suspect funds.
But the leaked suspicious activity reports (SARs) show that
other Barclays accounts with suspected links to the Rotenbergs remained open
until 2017.
One such company was Ayrton Development Limited.
According to the files, Barclays were suspicious of Ayrton's
activities and concluded that "[Arkady] Rotenberg is the true owner of
Ayrton".
Barclays did not comment when asked by Panorama about how
many accounts it suspects were owned by the Rotenbergs.
A spokesperson for Barclays said: "We believe that we
have complied with all our legal and regulatory obligations including in
relation to US sanctions."
"Given the filing of a SAR is not itself evidence of
any actual wrongdoing, we would only terminate a client relationship after
careful and objective investigation and analysis of the evidence, balancing
potential financial crime suspicions with the risk of 'de-banking' an innocent
customer."
The Rotenbergs declined to comment.
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