One of Russian President Vladimir Putin’s closest friends may have used London’s Barclays bank to launder money and avoid sanctions, note the FinCen Files, secret documents that reveal how major banks allowed dirty money around the world.
Billionaire Arkady Rotenberg has known the Russian president since childhood.
Financial restrictions, or sanctions, were imposed on Rotenberg by the United States and the European Union in 2014, which means that Western banks can face serious consequences for doing business with him.
Barclays claims that it has fulfilled all its legal and regulatory obligations.
A leak of US confidential files – so-called “suspicious activity reports” from banks – reveals how companies that are believed to be controlled by Rotenberg kept secret accounts.
The documents, called FinCEN Files (FinCEN files – FinCEN is the US government agency that investigates financial crimes), were analyzed by the BBC’s Panorama program.
In March 2014, the United States applied economic sanctions to Russia following the annexation of Crimea, a territory in Ukraine.
The US Treasury Department designated Rotenberg, 68, and his brother Boris, 63, “members of the inner circle of the Russian leadership”.
The pair trained at the same judo academy as Putin when they were young.
In recent years, Arkady Rotenberg companies have built roads, a gas pipeline and a power station under contracts awarded by the Russian state.
The US Treasury said the brothers “provided support for Putin’s favorite projects” and “won billions of dollars in contracts for Gazprom and the Sochi Winter Olympics, awarded to them by Putin”.
In 2018, the U.S. added Arkady Rotenberg’s son Igor to its list of sanctioned individuals.
The purpose of the sanctions is to isolate people from the list across the Western financial system.
Still, the Rotenbergs seem to have continued to move money in the UK and the USA.
Art and money laundering
In 2008, Barclays opened an account for a company called Advantage Alliance.
The leaked documents show that the company handled £ 60 million (R $ 417 million) between 2012 and 2016. Many of the transactions took place after the Rotenberg brothers were sanctioned.
In July of this year, an investigation by the United States Senate accused the Rotenbergs of using covert purchases of expensive art to escape sanctions – one of the companies involved in the scheme was the Advantage Alliance.
American investigators concluded that there was strong evidence that the Advantage Alliance belonged to Arkady Rotenberg and that the company had used his account at Barclays in London to buy millions of dollars worth of artwork for him.
One report noted that “secrecy, anonymity and a lack of regulation create an enabling environment for money laundering and evasion of sanctions”. Auction houses in the United States and the United Kingdom “have failed to ask basic questions” about art buyers.
Despite the sanctions, Arkady appears to have paid $ 7.5 million (R $ 40 million) to acquire the painting La Poitrine, by surrealist René Magritte (1898-1967).
On June 17, 2014, an Arkady-related company sent the money from Moscow to the Alliance’s Barclays account in London. The next day, Barclays sent the money to the seller in New York.
In April 2016, Barclays initiated an internal investigation of several accounts that it suspected were linked to the Rotenbergs.
Six months later, the bank closed Advantage’s account after concerns that it was being used to move suspicious funds.
But leaked suspicious activity reports show that other Barclays accounts with suspicious links to the Rotenbergs remained open until 2017.
One such company was Ayrton Development Limited.
According to the files, Barclays suspected Ayrton’s activities and concluded that “[Arkady] Rotenberg is the true owner of Ayrton “.
Barclays did not comment when asked by the BBC about how many suspicious accounts belong to the Rotenbergs.
A Barclays spokesman said, “We believe that we have met all of our legal and regulatory obligations, including in relation to U.S. sanctions.”
“Given that the registration of a SAR [relatório de atividades suspeitas] it is not in itself evidence of any real wrongdoing, we would only end a relationship with the client after careful and objective investigation and analysis of the evidence, balancing possible suspicions of financial crime with the risk of ‘removing an innocent client from the bank’. “
The Rotenbergs declined to comment.