Friday, February 23

US task force on Russian oligarchs sees evidence of sanctions evasion -unit chief


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NEW YORK — The US Department of Justice task force targeting assets of Russian oligarchs has seen evidence of attempts to evade the sanctions imposed after the invasion of Ukraine or to move assets ahead of possible sanctions, the unit’s chief said on Friday.

Andrew Adams, a veteran prosecutor tapped to lead the department’s new “KleptoCapture” task force last month, told Reuters in an interview that the level of cooperation between countries on probes into oligarchs’ ill-gotten gains had reached an “all-time high” in the wake of Russia’s assault on Ukraine.

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“There are efforts afoot – some of them publicly reported – to move, for example, moveable property in the forms of yachts, airplanes … into jurisdictions where, I think, people have the perception that it would be more difficult to investigate and more difficult to freeze,” Adams said.

The task force’s goal is to put the finances of Russian oligarchs under strain in a bid to pressure President Vladimir Putin to cease his weeks-long assault on Ukraine.

The unit’s name is a play on the word “kleptocracy,” a reference to corrupted officials who misuse power to accumulate wealth. The task force includes prosecutors, investigators and analysts from multiple federal agencies.

The United States and its allies have imposed several rounds of sanctions in recent weeks targeting Putin, many of his wealthy friends and dozens of Russian businesses and government agencies, some of which are accused of spreading disinformation designed to destabilize the Ukrainian government.

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‘SHARED SENSE OF PURPOSE’

Tracing oligarchs’ assets are often difficult because they are hidden behind “layers upon layers of shell companies scattered around the globe,” Adams said.

US prosecutors are receiving information from places previously thought to be safe havens, Adams said.

“Especially in the current context, and the current climate … the level of shared sense of purpose I think is at an all-time-high and from my perspective feels like a sea change in terms of alignment,” Adams said.

He declined to provide details of specific jurisdictions that have provided the task force with information, or to name specific people under investigation.

He said targeting assets located overseas was a major component of the unit’s work, adding that the United States has not been an attractive country for supporters of Russia’s government since around 2014 due to a series of sanctions over Moscow’s annexation of Crimea from Ukraine.

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“The United States has not been a friendly place to be parking your money as an oligarch,” Adams said. “The most ostentatious, the most obvious sorts of assets are not in the United States. They exist in parts of the world where it was easier to operate until relatively recently.”

Adams cited a 2019 case in which US authorities seized the Wise Honest, a North Korean cargo ship accused of making illicit coal shipments in violation of US sanctions even though the vessel was initially located outside American waters, as a “playbook” for some of the task force’s future cases.

Meanwhile, some European countries have already found and detained the yachts of wealthy Russian businessmen.

In Spain the government temporarily seized the $140 million Superyacht Valerie, which has been linked to Sergei Chemezov, a former KGB officer who heads state conglomerate Rostec.

French and Italian authorities last month also detained several vessels, including one belonging to Rosneft boss Ignor Sechin in a French Riviera port, and another owned by Russian billionaire Andrey Igorevich Melnichenko in the northern Italian port of Trieste. (Reporting by Sarah N. Lynch and Luc Cohen in New York; Editing by Scott Malone and Grant McCool)

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financialpost.com