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Scotland Yard to question Russian oligarch #VladimirGusinsky over money laundering allegations

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Scotland Yard detectives are scoping an investigation into a London based Russian oligarch over alleged links to money laundering.Officers were brought into the inquiry after detailed financial information was passed to the UK’s National Crime Agency (NCA).The NCA leads the fight against money laundering both at home and abroad - writes Philip Braund.

It’s alleged former media mogul Vladimir Gusinsky is using a labyrinth of litigation cases in America to move money.British officers are now likely to work with American law enforcement agencies principally concerned with money laundering allegations.

Facebook: Vladimir Gusinsky and his wife Ellina

Facebook: Vladimir Gusinsky and his wife Ellina

It’s believed that legal experts have found up to 15 courts cases, heard in America over recent years, showing a similar line of attack by Mr Gusinsky’s lawyers – namely, a breach of duty by former directors.

The cases follow a similar course: Mr Gusinsky and his US legal team comb through the legal documents of US companies – in particular those up for sale.They spot a legal problem that might affect shareholders and cost them money.

The Vladimir Gusinsky Revocable Trust (VGRT) files an action against the company and proceedings start.But the matter is dropped quickly, settled or voluntarily dismissed, and any monies paid into court or fees paid to lawyers on account are returned – minus costs – to the Trust.For example, last year the VGRT took action on behalf of the shareholder of USG Corp against the company and its directors for allegedly violated federal securities law. The Trust claimed USG published a misleading proxy statement for the company, pending a $7 billion acquisition by a German rival.

It argued there was not enough detail about the sale which, in turn, allegedly affected the value of the company for purchase.

The case was dismissed after an out of court settlement.

In an earlier case, heard in the same Delaware court and with the same Gusinsky lawyers - Rigrodsky & Long –VGRT took on KLX Inc.

The Trust contended KLX Inc filed misleading statements in connection with the proposed $3.25 billion sale of its aviation parts and services business to aerospace giant Boeing.

The Trust asked the court to halt the sale.

Once again, the case was voluntarily dismissed after lawyers reached an out of court settlement.

The use of litigation to launder money is not new.

It was used for a time in the UK before Judges became wary of the risks.

As a claimant to a claim it is easy to lodge a huge sum of money with eager and grateful lawyers in the expectation that they will run a case for two to three years.

Equally, it is open to a claimant to pay money into court either as an offer or as a bond or security for bringing the claim.

Once the case is settled, and the earlier the better, the money is paid out back to the client either by the lawyers or better still the court.

It is effectively “cleansed” for any source of funds purposes anywhere in the world.

A source, formerly part of and close to the UK law enforcement agencies, commented:

“This kind of activity potentially gives ‘gold standard’ source of funds verification for banks as the money comes either from a lawyer’s client account or from the court itself.

“The practice was first spotted in the UK more than 10 years ago when money was paid into court as an offer to settle.

“No source of funds checks was made on money paid into court.

“Once lodged at court, corrupt parties could make a fake settlement of their claim and ask that the money be paid out of court to the “winner”.

“Money paid from the High Court in London, which operated an account at the Bank of England, was as clean as you could wish.”

It is not known if this is what Mr Gusinsky has done and it is possible that the Trust which has brought the US claims acts independently of him.

It would however be a remarkable coincidence.

Mr Gusinsky, 64, is a serial litigator.

But Mr Gusinsky is already under investigation in the Cayman Islands after his company New Media Distribution Company went bust.

He’d promised to the London International Court of Arbitration last year to use a £5 million plus settlement in a different case to pay-off a bank [ East West Bank United] to which he owed money.

Lawyers instead put the money into the NMDC account in the Cayman Islands – but days later it had “disappeared”.

Mr Gusinsky claims it had been used to pay four “consultants” to the company for their “talent”.

He then promptly closed NMDC by having it wound up.

The NMDC accounts are now supposedly being forensically investigated by the liquidators FTI Consulting.

The London Globe contacted FTI Consulting both in London and the Cayman Islands about the liquidation of NMDC.

We asked if the money paid from the London litigation, and pledge to East West, was paid to Mr Gusinsky?

If not, who were the “four talented” consultants who were paid?

Did they invoice NMDC?

And, is FTI Consulting looking into Mr Gusinsky’s connections to Russian President Vladimir Putin and Gazprom Media?

Ashley Nicholls, Managing Director, FTI Consulting, said:

“Further to your enquiry, I can confirm that we are appointed as the Joint Official Liquidators of NMDC by the Grand Court of the Cayman Islands.

“However, per company policy, we do not comment on client engagements, so we are unable to comment further.”

Mr Gusinsky made his fortune in producing Russian television dramas television shows.

He claimed he had a production deal with the Kremlin that was sanctioned by Russian President Vladimir Putin.

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

He lives in St Moritz, Switzerland and his family resides in Connecticut, America.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Crime

Over 40 arrested in biggest-ever crackdown against drug ring smuggling cocaine from Brazil into Europe

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In the early hours of the morning (27 November), more than a thousand police officers with the support of Europol carried out co-ordinated raids against the members of this highly professional criminal syndicate. Some 180 house searches were executed, resulting in the arrest of 45 suspects. 

The investigation uncovered that this drug trafficking network was responsible for the annual importation of at least 45 tonnes of cocaine into the main European seaports, with profits exceeding €100 million over the course of 6 months.

This international sting, led by the Portuguese, Belgian and Brazilian authorities, was carried out simultaneously by agencies from three different continents, with coordination efforts facilitated by Europol:

  • Europe: Portuguese Judicial Police (Polícia Judiciária), Belgian Federal Judicial Police (Federale Gerechtelijke Politie, Police Judiciaire Fédérale), Spanish National Police (Policia Nacional), Dutch Police (Politie) and the Romanian Police (Poliția Română)
  • South America: Brazilian Federal Police (Policia Federal)
  • Middle East: Dubai Police Force and Dubai State Security

Results in brief 

  • 45 arrests in Brazil (38), Belgium (4), Spain (1) and Dubai (2).
  • 179 house searches.
  • Over €12m in cash seized in Portugal, €300,000 in cash seized in Belgium and over R$1m and US$169,000 in cash seized in Brazil.
  • 70 luxury vehicles seized in Brazil, Belgium and Spain and 37 aircrafts seized in Brazil.
  • 163 houses seized in Brazil worth in excess of R$132m, two houses seized in Spain worth €4m, and two apartments seized in Portugal worth €2.5m.
  • Financial assets of 10 individuals frozen in Spain.

Global co-operation 

In the framework of intelligence activities underway with its operational counterparts, Europol developed reliable intelligence concerning the international drug trafficking and money laundering activities of a Brazilian organized crime network operating in several EU countries.

The criminal syndicate had direct contact with drug cartels in Brazil and other South American source countries who were responsible for the preparation and the shipments of cocaine in maritime containers bound to major European seaports.

The scale of cocaine importation from Brazil to Europe under their control and command is massive and over 52 tonnes of cocaine were seized by law enforcement over the course of the investigation.

In April 2020, Europol brought together the involved countries who have since been working closely together to establish a joint strategy to bring down the whole network. The main targets were identified on either sides of the Atlantic Ocean.

Since then, Europol has provided continuous intelligence development and analysis to support the field investigators. During the action day, a total of 8 of its officers were deployed on-the-ground in Portugal, Belgium and Brazil to assist there the national authorities, ensuring swift analysis of new data as it was being collected during the action and adjusting the strategy as required.

Commenting on this operation, Europol’s Deputy Director Wil van Gemert said: "This operation highlights the complex structure and vast reach of Brazilian organized crime groups in Europe. The scale of the challenge faced today by police worldwide calls for a coordinated approach to tackle the drug trade across continents. The commitment of our partner countries to work via Europol underpinned the success of this operation and serves as a continued global call to action."

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EU

Navalny calls on Europe to follow the money

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The European Parliament’s Foreign Affairs Committee held an exchange of views with representatives of the Russian political opposition and NGOs on the current political and socio-economic situation in Russia.

Among the speakers was Alexei Navalny, who has recently recovered from being poisoned with a nerve agent similar to the one used in the Salisbury attack targeted at Sergei Skirpal and his daughter. 

Navalny called on Europe to adopt a new strategy towards Russia, that meets the new developments in Russian state leadership. He said that the forthcoming elections for the State Duma would be an absolutely crucial event and that everyone should be able to participate. If opposition politicians are not allowed to participate he asked the European Parliament and every European politician not to recognize the outcome.

Navalny told MEPs that it was not enough to sanction those responsible for carrying out his poisoning and that there was little sense in sanctioning those who didn’t travel a lot or who didn’t own assets in Europe. Instead, he said the main question that should be asked is who gained financially from Putin’s regime. Navalny pointed to the oligarchs, not just the old ones, but the new ones in Putin’s inner circle, with name-checks for Usmanov and Roman Abramovich. He said that these sanctions would be warmly welcomed by most Russians. 

On the various decisions of the European Court of Human Rights that have been ignored by the Russian judiciary, Navalny said it would be very easy to sanction them to prevent them from traveling to Europe and it would be very effective.

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coronavirus

Commission approves German scheme to compensate accommodation providers in the field of child and youth education for damages suffered due to the coronavirus outbreak

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The European Commission approved, under EU state aid rules, a German scheme to compensate accommodation providers for child and youth education for the loss of revenue caused by the coronavirus outbreak. The public support will take the form of direct grants. The scheme will compensate up to 60% of the loss of revenues incurred by eligible beneficiaries in the period between the beginning of the lockdown (which started on different dates across the regional states) and 31 July 2020 when their accommodation facilities had to be closed due to the restrictive measures implemented in Germany.

When calculating the loss of revenue, any reductions in costs resulting from income generated during the lockdown and any possible financial aid granted or actually paid out by the state (and in particular granted under scheme SA.58464) or third parties to cope with the consequences of the coronavirus outbreak will be deducted. At the central government level, facilities eligible to apply will have at their disposal a budget of up to €75 million.

However, these funds are not earmarked exclusively for this scheme. In addition, regional authorities (at Länder or local level) may also make use of this scheme from the local budgets. In any event, the scheme ensures that the same eligible costs cannot be compensated twice by different administrative levels. The Commission assessed the measure under Article 107(2)(b) of the Treaty on the Functioning of the European Union, which enables the Commission to approve state aid measures granted by member states to compensate specific companies or specific sectors for the damages caused by exceptional occurrences, such as the coronavirus outbreak.

The Commission found that the German scheme will compensate damages that are directly linked to the coronavirus outbreak. It also found that the measure is proportionate, as the envisaged compensation does not exceed what is necessary to make good the damages. The Commission therefore concluded that the scheme is in line with EU state aid rules.

More information on actions taken by the Commission to address the economic impact of the coronavirus pandemic can be found here. The non-confidential version of the decision will be made available under the case number SA.59228 in the state aid register on the Commission's competition website.

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