Friday

19th Jan 2018

Cyprus helping Russia to roll back US sanctions

  • Cypriot president Nicos Anastasiades with Putin in Moscow in 2015 (Photo: kremlin.ru)

Cyprus is helping Russia to roll back US sanctions against human rights abusers, a leading activist has warned.

The accusation, by Bill Browder, a British campaigner, comes after Cypriot authorities honoured Russia's request to question Browder's law firm, Georgiades & Pelides, in Nicosia, for a second time.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

  • Browder: "I would be terrified of going to Cyprus" (Photo: davos.ch)

Browder told EUobserver that the Russian investigation was designed to smear his name.

That, in turn, would help Russia in its lobbying to overturn the Magnitsky Act, a US law that Browder inspired, which empowers US authorities to seize money held overseas by Russian human rights abusers.

"This is designed to discredit me in their long-term efforts to get the Magnitsky Act repealed," Browder said.

"Cyprus is now playing an extra-territorial role in Russia's cover-up of the Magnitsky case," he said.

Russian envoys also lobbied US leader Donald Trump's family in New York last year in a wider campaign against the Magnitsky law.

The EU declined to impose similar laws, but Cyprus stands alone in Europe in helping Russia to undo the US measures.

British, Dutch, French, and German authorities, as well as Interpol, the international police agency, have refused to honour Russia's legal assistance requests on grounds that they were politically motivated.

Browder said his lawyers had warned the Cypriot justice ministry that this was the case.

"But they [Cypriot authorities] wrote back to us in a letter that looked like it had been drafted by the Russian prosecutor's office and cut and pasted onto the Cyprus government's stationery," he said.

Russian investigators already questioned Georgiades & Pelides in 2015.

They filed a second legal request in August, with Browder now seeking a court injunction in Nicosia to stop the new interrogation from going ahead.

"There is a real prospect of irrevocable harm to be caused to Mr Browder … by any acts to advance that questionnaire," an affidavit filed by Browder's lawyer said.

"If the various requested documents, information, and testimony are handed over by Cyprus to the Russian investigators they will be used … to further advance the cover-up of the $230 million fraud and the involvement of Russian government officials in it," the affidavit said.

Magnitsky affair

The Magnitsky Act was named after Sergei Magnitsky, Browder's former auditor in Russia when Browder was a hedge fund manager.

Magnitsky found out that Russian officials had embezzled $230 million (€196mn) from the state, but he wound up dying in prison after he exposed the scam.

Russia then accused Browder and Magnitsky of having stolen the money.

They went after Browder's lawyers in Cyprus because he used to manage some of his Russian assets via a holding firm there due to Cyprus' favourable tax regime.

The US at first imposed asset freezes on 17 Russians under the Magnitsky Act, but the list has now grown to 44 names.

If it keeps growing, it could reach the top, amid recent revelations that a close friend of Russian leader Vladimir Putin took some of the stolen $230 million.

Cyprus is also helping to protect illicit Russian money more directly.

Browder, back in 2012, gave Cypriot authorities 133 pages of documents which showed that $31 million of the stolen money was moved out of Russia into the EU via five Cypriot banks.

But Cypriot authorities did not do anything about it.

"We found the Cypriot law enforcement authorities to be hopeless in conducting the kind of anti-money laundering investigations that other European countries have been pursuing seriously and fearlessly, but at the same time the Cypriots are highly cooperative with Russia in persecuting me for my work on the Magnitsky justice campaign," Browder said.

Extradition fear

He said he was afraid to set foot in Cyprus in case it extradited him to Russia to meet the same fate as Magnitsky.

"I would be terrified of going to Cyprus because I believe I would be delivered back to Russia," Browder said.

The Cypriot foreign ministry declined to comment.

The Cypriot justice ministry did not reply to EUobserver's queries.

A recent investigation by the OCCRP, a journalist's club in eastern Europe, found that Cyprus helped to move $871 million of other illicit Russian money out of Russia between 2011 and 2014.

A leaked report by German intelligence in 2012 said Russian criminals and oligarchs held $26 billion in deposits on the island, a sum about the same size as Cyprus' GDP.

Cyprus in spotlight on Russia money laundering

Cyprus’ failure to go after Russian mafia money in its banks indicates it's paying no more than “lip service” to international money laundering laws, a Dutch MP has said.

MEPs target exports of cyber surveillance tech

MEPs have introduced a human rights clause into the export of cyber surveillance technology as part of EU-wide reforms to prevent abuse by autocratic regimes. The Strasbourg plenary will vote on the bill on Wednesday.

News in Brief

  1. EU Parliament to investigate glyphosate-decision process
  2. 'Mutagenesis' falls outside EU's GMO rules, says EU top lawyer
  3. Decision on Polish MEP's Nazi-era slur postponed
  4. Bad loans in EU decrease to 2014 levels
  5. UK demand for EIB loans dropped in 2017
  6. EIB president: Juncker fund has worked
  7. Moscovici calls for more transparency on tax havens list
  8. Commission proposes VAT overhaul

Stakeholders' Highlights

  1. Nordic Council of MinistersNordic Solutions for Sustainable Cities: New Grants Awarded for Branding Projects
  2. Mission of China to the EUTrade Between China, Belt and Road Countries up 15%
  3. Nordic Council of MinistersOresund Inspires Other EU Border Regions to Work Together to Generate Growth
  4. Mission of China to the EUTrade Between China, Belt and Road Countries up 15%
  5. AJC Transatlantic InstituteAJC Calls on EU to Sanction Iran’s Revolutionary Guards, Expel Ambassadors
  6. Dialogue PlatformRoundtable on "Political Islam, Civil Islam and The West" 31 January
  7. ILGA EuropeFreedom of Movement and Same-Sex Couples in Romania – Case Update!
  8. EU2017EEEstonia Completes First EU Presidency, Introduced New Topics to the Agenda
  9. Bio-Based IndustriesLeading the Transition Towards a Post-Petroleum Society
  10. ACCAWelcomes the Start of the New Bulgarian Presidency
  11. Mission of China to the EUPremier Li and President Tusk Stress Importance of Ties at ASEM Summit
  12. EU2017EEVAT on Electronic Commerce: New Rules Adopted

Latest News

  1. Nato prepares to take in Macedonia
  2. Taking full benefit of supercomputers in Europe
  3. Spitzenkandidat system 'difficult to get rid of', hopes lead MEP
  4. Rights NGOs face fresh threats across the EU, agency says
  5. EIB 'more sensitive' to fraud after Dieselgate, chief insists
  6. EU 'hypocrisy' condemns people to Libya, says NGO
  7. Next year's EU election at risk of Russian meddling
  8. Hungary to tax NGOs that 'help' migration

Stakeholders' Highlights

  1. European Jewish CongressChair of EU Parliament Working Group on Antisemitism Condemns Wave of Attacks
  2. Counter BalanceA New Study Challenges the Infrastructure Mega Corridors Agenda
  3. Dialogue PlatformThe Gülen Community: Who to Believe - Politicians or Actions?" by Thomas Michel
  4. Plastics Recyclers Europe65% Plastics Recycling Rate Attainable by 2025 New Study Shows
  5. European Heart NetworkCommissioner Andriukaitis' Address to EHN on the Occasion of Its 25th Anniversary
  6. ACCACFOs Risk Losing Relevance If They Do Not Embrace Technology
  7. UNICEFMake the Digital World Safer for Children & Increase Access for the Most Disadvantaged
  8. European Jewish CongressWelcomes Recognition of Jerusalem as the Capital of Israel and Calls on EU States to Follow Suit
  9. Mission of China to the EUChina and EU Boost Innovation Cooperation Under Horizon 2020
  10. European Gaming & Betting AssociationJuncker’s "Political" Commission Leaves Gambling Reforms to the Court
  11. AJC Transatlantic InstituteAJC Applauds U.S. Recognition of Jerusalem as Israel’s Capital City
  12. EU2017EEEU Telecom Ministers Reached an Agreement on the 5G Roadmap