11/04/22

GLOBAL REGULATION: New release reveals more than 800 Russians behind secret companies.

As published on irishtimes.com, Monday 11 April, 2022.

The International Consortium of Investigative Journalists is making public a trove of new information about shell companies linked to Russians as part of a broader effort to spotlight the offshore world and the hidden wealth of Kremlin-linked figures in the wake of Russia’s invasion of Ukraine.

The company names and other data on more than 800 Russian nationals come from Seychelles-based Alpha Consulting Ltd, an offshore services provider that serves mostly Russian clients have been added to the ICIJ’s Offshore Leaks Database which is publicly accessible.

The data includes newly discovered details about companies tied to Russian president Vladimir Putin’s allies and other Russian political figures who shelter assets behind opaque businesses that can also be used to escape global sanctions.

The database now contains information on more than 800,000 offshore companies, foundations and trusts, and links to people and companies in more than 200 countries and territories, which can be publicly searched and downloaded.

In addition to the data release, ICIJ and its partners are publishing new reporting that shows how Russian bankers, oligarchs and others in Mr Putin’s orbit have obscured vast wealth in tax havens with the help of western enablers.

The data release, and the stories, draw primarily from the Pandora Papers, the millions of offshore financial records that fuelled a 2021 global investigation.

This new publication, dubbed Pandora Papers Russia, marks the latest effort by ICIJ to shine light into one of the world’s most secretive industries – and follows a decade of reporting on Russian offshore manoeuvring in particular. For ease of access, ICIJ has compiled much of that prior reporting in a dedicated page called the Russia Archive.

The reporting and the data release come as US, British, European and other authorities scramble to hunt down money and assets of oligarchs and others with Kremlin ties, a task that offshore secrecy brokers, such as Alpha Consulting, have made far more difficult.

Forty per cent of more than 2,000 offshore corporations, foundations and trusts found among the leaked Alpha Consulting data and published today have one or more Russian beneficial owners. Another 23 per cent have one or more Ukrainian beneficial owners.

Alpha Consulting is one of 14 offshore services providers whose documents were leaked to ICIJ, setting in motion the Pandora Papers investigation, which reviewed 11.9 million records, containing 2.94 terabytes of confidential information.

Offshore service providers specialise in the incorporation and operation of companies, trusts and foundations typically used to shelter assets in secrecy jurisdictions away from the view of tax and law enforcement authorities, the courts and the public.

The release of Alpha Consulting data is part of ICIJ’s ongoing effort to publish information from the Pandora Papers project. More data tied to the other providers will be published in the coming weeks.

Created by ICIJ in 2013 and maintained by ICIJ’s data and tech teams, the Offshore Leaks Database strips away the secrecy that cloaks companies and trusts incorporated in tax havens and exposes the people behind them. The database contains information from leaks that served as the basis for five ICIJ projects: Offshore Leaks in 2013, the blockbuster Panama Papers and Bahamas Leaks in 2016, the Paradise Papers in 2017, and last year’s Pandora Papers, the data of which is being added in instalments.

The interactive database application reveals more than 740,000 names of people and companies creating and operating secret offshore structures. The data includes, when available, the names of the real owners.

Because the records are leaked, not from a standardised corporate registry, there may be duplicates. In some cases, companies are listed as shareholders for other companies or for trusts, an arrangement that often helps obscure the real people behind offshore entities.

ICIJ doesn’t publish raw documents, corporate or personal, en masse. While the database contains a great deal of verified, organised and searchable information about company owners, proxies and intermediaries in secrecy jurisdictions, it doesn’t disclose private communications, bank account information or private personal documents.

ICIJ is publishing this information in the public interest. While the presence of a person’s or a company’s name is not intended to suggest or imply that they have engaged in illegal or improper conduct, ICIJ believes that providing this data to all helps shine a light on the scope of the offshore economy and the damage it perpetuates.

Alpha Consulting was founded in 2008 by Victoria Valkovskaya, a Russian former translator from Moscow who moved to the Seychelles, an Indian Ocean island nation, and opened the firm with her then-husband, Roy Delcy, a Seychelles native.

As is typical in the offshore business, the firm provides so-called nominee directors, or stand-ins, for official corporate paperwork to help shroud shell companies’ actual owners. The company reported in 2019 that its client base is 75 per cent Russian.

The publication of Alpha Consulting data adds to what already was a huge trove of information on Russian elites in the Offshore Leaks Database. The database contains records from two financial service providers in the Pandora Papers that, together with Alpha Consulting, have the highest percentages of Russians as beneficial owners: Alemán, Cordero, Galindo & Lee (Alcogal) of Panama and Fidelity Corporate Services, founded in the British Virgin Islands. The records of all three firms are now available in the Offshore Leaks Database.

The database now includes information extracted from five leaks, on more than 11,000 entities with links to Russia.

The Pandora Papers investigation links nearly 3,700 companies to more than 4,400 Russian nationals – by far the most among all nationalities found in the Pandora Papers data. Russians control about 14 per cent of all the companies and other legal entities revealed in the leak.

Hundreds of Russians have been sanctioned by western authorities since Mr Putin ordered the invasion of Ukraine. But efforts to identify and freeze assets held by Mr Putin’s inner circle have bogged down on the shores of secrecy jurisdictions. Throngs of well-connected Russians own businesses in places that make little to no ownership information available. Some companies are used to hide assets such as yachts and mansions. Some are used to shuffle money around in schemes that line Mr Putin’s pockets.

In the Pandora Papers, Russian political figures – including former ministers, ex-members of the Russian parliament (the Duma) and a presidential candidate – own 163 distinct entities. That’s more offshore companies than the ones owned by politicians from any other country.

In addition to politicians, more than 45 oligarchs appear in the Pandora Papers data. They range from billionaire businessmen who run major oil companies to kingpins in the sports world. As of April 8th, at least 12 of them were targeted by the recent sanctions.