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Trans-Atlantic law officers to investigate #GusinskyFile

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A disgraced Russian oligarch is being investigated on both sides of the Atlantic following a series of collapsed civil court cases. Britain’s National Crime Agency (NCA) and America’s Office of Foreign Assets Control (OFAC) have been sent details of a number of actions involving Vladimir Gusinsky. The NCA has a brief to counteract money laundering, while OFAC seeks out individuals deemed to be a threat to US national security, writes Phil Braund.

Last year OFAC identified several Russian individuals and companies as Specially Designated Nationals.

One organisation recently sanctioned was Gazprom-Media, with whom Gusinsky had significant dealings. He even boasted he had an “unbreakable agreement” with them and the Kremlin.

Since 2017, multi-millionaire Mr Gusinsky appears to have brought a series of claims in America against US companies. Most cases are filed as the Vladimir Gusinsky Revocable Trust being the plaintiff.

That entity is registered at an address in Chicago, Capital Resources Group Inc. And, a “Vladimir Gusinsky” is named as the principal.

His D.O.B is recorded there as 27/01/55 and his wife is named as “Ellina” Gusinsky. Is this Vladimir Gusinsky or a remarkable coincidence?

Court action in America

In his court actions he often cites that companies have not acted in his best interests, or those of other shareholders whom he claims to represent.

Facebook: Ellina and Valdimir Gusisnky

Facebook: Ellina and Valdimir Gusisnky

But only weeks after papers are served his lawyers almost always voluntarily dismiss the actions.

Information from court documents show Gusinsky is usually represented by US firm Rigrodsky and Long.

It has offices in Delaware, California and New York, and claims to specialize in violations of federal securities’ laws, breaches of fiduciary duties by corporate insiders, and the violation of consumer protection laws on behalf of institutional and individual investors.

Just one of many claims recorded on publicly accessible records from multiple UK and US sources show that in 2017 the “Vladimir Gusinsky Revocable Trust” sued “Exar Corporation” in the courts of the Northern District of California.

The claim alleged breaches of duty by former directors, a theme repeated in several other similar looking claims by the “Trust”.

It was voluntarily dismissed not long after it was started on terms which were never - so far - disclosed.

Facebook: Vladimir Gusinsky

Facebook: Vladimir Gusinsky

Another example is the “Trust’s” claim against “KLX Inc et al” in 2018 before the Delaware Federal Court.

Described as a putative “class action” on behalf of “public stockholders”, it was again voluntarily dismissed quickly on secret terms.

Sophie Eyre, partner at leading international law firm, Bird and Bird in London said: “This scale of litigation is highly unusual, as is the multiple and repeated nature of its commencement and apparent abandonment.

“There is, of course, every possibility that this is explained by coincidence or unusual circumstances not yet apparent from any publicly accessible source, but it is surely right for the authorities to have the opportunity to seek out that explanation.”

Cayman Islands Inquiry

The “Gusinsky File” has also been sent to FTI Consulting in the Cayman Islands.

They are looking into the sudden closure of the New Media Distribution Company owned by Gusinsky.

NMDC collapsed after more than $5 million was paid into its accounts following a court hearing.

Gusinsky had promised the London Court of International Arbitration in October 2018 that he would use the money to repay a loan to the Luxembourg based bank East-West United Bank.

But he didn’t.

The money went to four undisclosed staff for their “creative talent”.

Forensic accountants are now ploughing through the books of NMDC to discover who was paid and why.

And, given that Gusinsky told the court on oath that he owned NMDC, they are trying to establish whether that was correct and, if not, who was the actual owner at the time of its closure.

There are calls for Gusinsky to be re-called to the High Court to explain why he did not pay the East-West United Bank.

MPs all for action on money laundering

The 'Gusinsky File' has also gone to Tom Tugendhat, MP, and chairman of the Foreign Affairs Select Committee, which has shown an interest in Russian nationals and their activities in the UK.

Gusinsky has a home in Kensington and Chelsea, London.

Tom Tugendhat MP, Chairman Foreign Affairs Select Committee

Tom Tugendhat MP, Chairman Foreign Affairs Select Committee

Last year the committee called on the Government to “tighten up” on corrupt money coming into Britain and being “laundered”.

Money laundering is an illegal way to conceal ill-gotten gains made through crime.

It involves a series of complex bank or commercial transfers to “clean” money, which can then be used for legitimate purposes.

Law enforcement agencies around the world co-operate with each other to track down money launderers and the people easing the bogus transactions.

London is regarded by many financial experts to be a major centre for money-laundering, an unenviable reputation that prompted the Foreign Affairs Select Committee report called “Moscow Gold”.

After its inquiries, it demanded further sanctions against “Kremlin connected individuals”.

Tugendhat said: “The Government should be taking far more seriously the threat of corruption from Russia, which is no longer a financial crime but a national security issue.

“The reality is that the last six to 12 months have shown us that it is no longer just a crime, it is a threat to national security.

“What we highlight very clearly is the link between corrupt Russian money and the Kremlin and the way that it is then deployed under Kremlin orders to further Kremlin aims.

“Whether that be corrupting countries allied to us, like Ukraine, or used to finance militias in parts of the world where we would frankly wish they weren’t, or to finance Facebook campaigns as we have seen in recent works.”

The Foreign Affairs Select Committee urged for better co-operation with the US and EU to create stronger international sanctions.

It said it allowed the Kremlin – through individuals and entities - to carry out “acts of aggression” against Britain.

The report added: "Despite the strong rhetoric, President Putin and his allies have been able to continue 'business as usual' by hiding and laundering their corrupt assets in London.

“Turning a blind eye to London's role in hiding the proceeds of Kremlin-connected corruption risks signalling that the UK is not serious about confronting the full spectrum of President Putin's offensive measures."

Gusinsky flees Russia

Vladimir Gusinsky fled Russia in 2000 after falling out with the newly installed President Putin.

He was languishing in the infamous Butyrka Prison in central Moscow on charges of “illegal privatization”, when he was approached by Press Minister Mikhail Lesin to sell his “Media Most” company to Gazprom.

In return, Lesin promised Gusinsky he would close the case against him.

Gusinsky agreed, and three days later he was freed, and he left the country for Spain.

Firstly, through the Spanish courts the Russians successfully had Gusinsky arrested but later attempts to extradite him failed.

By the time the Russians asked again he’d fled to Israel.

Later, Gusinsky obtained a Spanish passport by declaring he was a Sephardi Jew – Sephardi means Spanish or Hispanic.

He also holds an Israeli passport and currently lives in St Moritz Switzerland.

Two years later, as the now called Gazprom-Media was buying the final stake in his channels, Gusinsky reached another agreement with the Kremlin – a pact he crowed that was “confirmed by Putin”.

Vladimir Putin, President of Russia

Vladimir Putin, president of Russia

Gusinsky would call this his “unbreakable agreement” – a deal that would guarantee him endless commissions and money for his broadcast dramas.

On the other hand, the contract also prevented Gusinsky from taking advantage of a decision made in his favour by the European Court of Human Rights in Strasbourg.

The ECHR ruled he [Gusinsky] could chase Gazprom’s foreign assets in a civil action.

It’s said he “cynically” used the ruling to open negotiations with the Kremlin.

With his “unbreakable agreement” firmly in his back pocket, Gusinsky’s New Media Distribution Company (NMDC) produced more than 3,000 original episodes and picked up a host of awards along the way.

Many programmes are firm favourites with Russian viewers – “Agent of National Security”, “The War of Cops”, “Secrets of Investigation” all reached audiences of millions.

In total, it’s said Gusinsky’s companies supply 13% of content for Russian television.

'Agent of influence'

Renowned Russian investigative journalists Ilya Rozhdestvensky and Roman Badanin, writing for Proekt [Project] Media, uncovered the fact that content producer Panorama made each “Secrets of Investigation” show for about $125,000.

But Russian TV channels were buying them at double that price – making Gusinsky’s media empire profits of more than $500 million since 2000.

And, some people are now suggesting, given his Russian “agent of influence" abroad, that Gusinsky should be registered in America under its Foreign Agents Registration Act (FARA).

FARA was introduced in the 1940s to stop Nazi propaganda spreading in the US.

At one point the Soviet news agency TASS and newspapers Izvestia and Pravda were registered as agents.

Broadcaster Russia Today was registered but wanted exemption.

It was reluctant to disclose its finances, board members and demonstrate evidence of editorial independence.

It has now registered.

Since FARA was introduced 221 Russian companies have been registered as foreign government agencies.

'No payments will be made'

In his book Without Putin. Dialogues with Evgeniy Kiselev, Russia’s Finance Minister Mikhail Kasianov recounts a meeting with Vladimir Gusinsky.

He said the media boss was supposed to pay the first tranche of the $150 million state loans given to start his NTV station.

He said: “Gusinsky was very assertive that no first, second, or tenth payment will be made on this loan.

Mikhail Kasianov, former Minister of Finance

Mikhail Kasianov, former Minister of Finance

“I told him you will have to pay since the existing agreement clearly indicates dates and amounts.

“He answered ‘you are the newly made Minister of Finance and do not know anything about important political agreements’.

“He told me that his Most group supported the authorities in the 1996 elections.

“And, there was an understanding all debts would be written off because of this.

“I insisted his unconditional obligations had to be fulfilled.”

Kasianov said Gusinsky’s response was to pull out his mobile phone and call the Prime Minister Sergey Stepashin.

Sergey Stepashin, former Prime Minister of Russia

Sergey Stepashin, former Prime Minister of Russia

After a few brisk words he hung up. Moments later Stepashin called Kasianov.

Kasianov said: "I was told to settle the question, come up with something, we do not need scandals.”

However, the matter was not resolved.

Kasianov said: “Gusinsky told me I’d regret what I’d done.

“The next day an anonymous article appeared in the newspaper Segodnya – owned by Gusinsky – saying I took ‘kickbacks’.”

Many Russians believe Gusinsky still has strong ties to the Moscow.

Gusinsky’s 'bedtime list' of enemies

Gusinsky and a former business partner Konstantin Kagalovsky recently clashed in the High Court in London in a dispute over a Ukrainian television station, TVi.

After the hearing Mr Kagalovsky said: “Everyone thinks that Goose – as he’s known – is a frightened man on the run from the Kremlin.

“Well, nothing could be further from the truth.

“He has a deal with the Kremlin – something he boasted to me about – that’s allowed him to make a fortune out of supplying television programmes to Russian stations for years.

“He never tired of telling me about his special deal with the Kremlin.

“Who signed the deal and how it meant that he’d have to stay away from politics back home.

“He called it his deal with the ‘Moscow Side’ and said it was signed by the Russian Federation, Gazprom and Gazprom Media.

“And, whenever he spoke about Putin, he rarely called him by his name – it was usually ‘Big Boss this and Big Boss that’.

“He insisted he had a special relationship with Moscow, but I’m not so sure.

“I think they had him on a hook and were playing him.

“To the public Gusinsky is a political victim and enemy of Putin.

“However, it’s typical KGB practice to make an open enemy into a hidden agent of influence.

“I remember him telling me that before he went to sleep at night, he wrote of list of people he hated and kept it by his bedside.

“You’d be surprised who was on his list.”

EU

Kazakhstan’s Kairat Abdrakhmanov appointed OSCE High Commissioner on National Minorities

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Kairat Abdrakhmanov. Photo credit: Kazakh Foreign Ministry

Kazakh diplomat and Kazakhstan’s Ambassador to Sweden and Denmark Kairat Abdrakhmanov (pictured) was appointed High Commissioner on National Minorities (HCNM) at the Organization for Security and Co-operation in Europe (OSCE), said Kazakh Foreign Minister Mukhtar Tileuberdi at a press briefing today (4 December), writes Assel Satubaldina.

The decision was made during the 27th meeting of the OSCE Council of Foreign Ministers that took place online 3-4 December.

Abdrakhmanov’s candidacy was submitted by Kazakhstan and was “positively welcomed by all OSCE members”, said the minister, which, according to him, attests to Kazakhstan’s increasing role and influence on the international arena as well as the political reforms carried out by Kazakh President Kassym-Jomart Tokayev. Kazakhstan’s chairmanship in the 57-nation OSCE in 2010 also served as a positive factor.

Abdrakhmanov is a veteran Kazakh diplomat. A graduate of the Al Farabi Kazakh National University, he previously served as Kazakh Foreign Minister, Kazakhstan’s Permanent Representative to the OSCE and to the United Nations, Kazakhstan’s Ambassador to Austria, and Israel.

The post of High Commissioner on National Minorities is one of the key positions at the OSCE assigned to identify and address situations in regard to tensions involving national minorities, which could give rise to a conflict between OSCE member states. The commissioner personally visits representatives of governments and minorities and analyzes the current threats to stability in the OSCE region.

The high commissioner is elected every three years and Abdrakhmanov replaced Italian diplomat Lamberto Zannier, whose three-year tenure ended 18 July this year.

Being appointed as OSCE High Commissioner, Abdrakhmanov will have to relinquish his position as Kazakhstan’s Ambassador to Sweden and Denmark to “ensure objectivity and impartiality.”

“As you know, 2020 has been uneasy for the OSCE, because, over the past months, the organization’s senior positions were vacant. In July, all four relinquished their mandates. We believe it was an institutional crisis. But a solution was found today, and the consensus was achieved on key positions,” said Tileuberdi, noting that no diplomat from the Commonwealth of Independent States and Central Asia has been previously appointed to such a high-level position.

During the meeting, the decision was also made on the OSCE Secretary-General, Special Representative for the Freedom of the Media and head of the Office for Elections and Human Rights. The four top positions at the organization remained vacant since July.

“Our country will continue to work in close cooperation with Sweden’s chairmanship at the OSCE,” concluded the minister.

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€6.1 billion for sustainable fisheries and safeguarding fishing communities 

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Today (4 December) EU legislators reached a provisional agreement on how EU countries will be able to spend funds allocated to fisheries and aquaculture for 2021-2027.

The European Maritime, Fisheries and Aquaculture Fund (EMFAF) for the period 2021-2027 amounts to €6.1 billion (€6.108bn EUR in current prices). €5.3bn will be allocated for the management of fisheries, aquaculture and fishing fleets, while the remaining sum will cover measures such as scientific advice, controls and checks, market intelligence, maritime surveillance and security.

Member states will have to spend at least 15% of the money on efficient fisheries control and enforcement, including fighting against illegal, unreported and unregulated fishing. In line with the Green Deal, actions under the fund will contribute to the overall budget objective to dedicate 30% of funds to climate action.

Compensation for fishermen

If fishermen’s activities cease permanently, they can be supported to scrap or decommission a vessel. In order to receive compensation, the equivalent fishing capacity is permanently removed from the EU fishing fleet register and the beneficiary must not register any fishing vessel within five years of receiving support.

If fishing activities cease temporarily, fishermen may be granted compensation for a maximum duration of 12 months per vessel or per fisherman during the programming period.

Specific needs of small-scale coastal fishing and young fishermen

Member states will need to take into account the specific needs of small-scale coastal fishing, including simplifying administrative requirements. Also, first acquisition of a fishing vessel or partial ownership (of at least 33%) can be funded if the fisherman is no more than 40 years of age and has worked for at least five years as a fisherman or has acquired the equivalent qualification. Fishermen can purchase small-scale coastal vessels (total length less than 12 meters) that have been registered for three years or vessels up to 24 meters that have been registered for five years.

Small-scale vessels may also receive support to replace or modernise engines if the new or modernized engine does not have more power in kW than that of their current engine.

Improving safety, working conditions and energy efficiency

A fishing vessel that is not longer than 24 meters and older than 10 years can have its gross tonnage increased if this results in significant improvements, such as renovating accommodation and other facilities for the well-being of the crew, better on-board fire prevention and safety systems, increased energy efficiency or lower CO2 emissions.

Other key measures

- Engines can be replaced or modernized under strict conditions: for vessels between 12 and 24 meters and at least five years old, the new or modernised engine must not have more power in kW and a reduction of 20% CO2 emissions must be ensured; the fishing capacity withdrawn due to engine replacement or modernisation cannot be replaced.

- Focus on outermost regions: member states will have to prepare an action plan for each of their outermost regions; specific budget allocations are foreseen.

- Support may also be granted for storage of fisheries products in exceptional events generating a significant disruption of markets.

Rapporteur Gabriel Mato (EPP, ES) said: “We reached a balanced agreement on the future European Maritime, Fisheries and Aquaculture Fund. A fund that would enable the EU fleet to fish and farm better, not to fish more. A fund that would allow the sector to invest in workers’ safety and wellbeing and environmentally-efficient engines and vessels. And a fund that would allow for generational renewal, while avoiding overcapacity and overfishing. The fishing and aquaculture sectors and the whole seafood value chain need support now more than ever to face current and future challenges.”

Next steps

Parliament and Council are now expected to endorse the agreement. The provisions of the regulation will then apply as of 1 January 2021.

Background

The European Maritime and Fisheries Fund proposal was published by the Commission in June 2018 and refers to the Multiannual Financial Framework for 2021-2027. The previous EMFF budget covering the years 2014 to 2020 amounted to €6.4bn.

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EU Budget 2021 deal: Supporting the recovery 

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MEPs have fought for and obtained better support for key EU programmes creating jobs, tackling the fallout from the COVID-19 pandemic and boosting climate action.

Today (4 December), the negotiators from the European Parliament and the Council reached a common understanding on the 2021 EU Budget.

The preliminary figures are €164.3 billion in commitment appropriations and €166.1bn in payment appropriations. Detailed figures will be available later.

For a more competitive Europe, creating jobs and investing in the EU’s future

MEPs succeeded in reinforcing, on top of the Commission’s original budget proposal, programmes they considered key to boosting growth and jobs, reflecting widely agreed European Union priorities, namely Digital Europe (+25.7 million) and the Connecting Europe Facility (CEF) for transport infrastructure (+€60.3 million).

Strengthen respect for Europe’s values and boosting climate action

As a supplementary effort to fight climate change, the reinforcements obtained by the EP for the LIFE programme (+€42 million) aim at contributing from the outset to reaching the target of 30% of climate-relevant spending in the EU budget for the 2021-2027 period.

The Rights and Values programme will receive an additional €6.6m, and the European Public Prosecutor's Office (EPPO), an independent Union body aiming to fight crimes against the Union budget will benefit from an extra €7.3m.

MFF top-ups: supporting the young, EU research and health care

Other reinforcements for 2021 reflect the top-ups to selected key EU programmes Parliament obtained in the deal with Council on the next long-term EU budget (MFF) 2021-2027.

This is the case for Erasmus+ (+€175.1m), Horizon Europe (research programme, +€20m) and the EU4Health programme, the EU’s response to COVID-19, by a further €74.3m. EU4Health will support medical and healthcare staff, patients and health systems. Similarly, the commitment appropriations for humanitarian aid have been increased by €25m and for supporting the EU’s southern neighbourhood by €10.2m.

“I’m pleased we could reach a swift agreement in the interest of European citizens in these challenging times. With the top-ups for some of the future-looking programmes agreed in the multi-annual framework just weeks ago, we obtained budget increases for other programmes with proven European added value. These extra investments in, for example, the trans-European transport networks and digital Europe all answer to real needs and are in line with the expectations of EU citizens”, said the Chair of the Budgets committee Johan van Overtveldt (ECR, BE).

“Parliament and Council today reached an agreement on the 2021 EU budget. €164 billion to protect citizens, reduce the immediate impact of the crisis and prepare for a more prosperous, balanced and sustainable future. In the last two days of the negotiations, Parliament secured an additional €183m for its priorities: health, climate and employment. Considering the very rigid framework, this is a good result. Faced with governments that were unwilling to give up one cent, Parliament did its utmost and obtained additional increases. But, in all conscience, we all know that this budget is not up to the task. It was the maximum that could be obtained given the multiannual budget that was negotiated with heads of state who decide unanimously.

"But the good news is that there is a solution that can mobilise more than €50bn per year for health, climate and employment, and that will not be blocked by the unanimity rule: taxing speculation by relaunching the existing reinforced cooperation on this subject. I call on the leaders of these pioneering countries, starting with Merkel and Macron, to get to work on this tax without delay”, said the lead rapporteur (Commission section) Pierre Larrouturou (S&D, FR).

"Thanks to the united position of the European Parliament, we have reached a very good political agreement on the 2021 budget of the European Union institutions, despite a difficult context of crisis. My concern throughout these negotiations was to ensure that all the institutions of the Union, i.e. the Court of Justice, the Court of Auditors, the European Ombudsman, the Committee of the Regions, the Economic and Social Committee, the European Data Protection Supervisor,..., have sufficient resources and staff to enable them to fulfill their missions as well as possible and to function optimally. This was made possible following our commitment to save money in connection with the changes in our activities during the COVID-19 pandemic", said the rapporteur for the other sections, Oliver Chastel (RENEW,BE).

Next steps

In the absence of an agreement in Council on the EU’s long-term budget (MFF, Multiannual Financial Framework 2021-2027), the two arms of the EU’s budgetary authority, Parliament and Council, have not formalised their deal. Once the MFF is adopted, Commission will propose the substance of the agreement as second draft budget.

Once Council has formally adopted the compromise in the form of this second draft budget, it will be submitted for approval to the Committee on Budgets, then voted on in plenary in the European Parliament and signed into law by its President.

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