Austria’s Prosecution Service refuses to open case into offshores Troika Dialog
Austria’s Prosecution Service did not find grounds for an official investigation of activity of an offshore network Troika Dialog which, according to correspondents of OCCRP, had been used for laundering of funds and legalization of income.
Austrian law enforcers have not initiated a criminal case on grounds of an investigation into an offshore network of an investment company Troika Dialog carried out by correspondents of OCCRP. This was told RBC as a reply by the Prosecution Service for investigation of economic crimes and corruption.
In March, this year, correspondents of OCCRP issued the investigation into activity of Troika Dialog (Project into investigation of corruption and organized crime). They said the contractors of Troika abroad were Deutsche Bank, Raiffesen Bank and Citigroup. Soon after the investigation was published, founder of Hermitage Capital fund Bill Browder sent a complaint to the Austria’s Prosecution Service with a request to check the local credit organizations which, as he indicated, had ignored suspicious payments from fly-by-night companies and allowed “the criminals from Russia to siphon off the funds” from the country. Browder called for investigating the transactions worth of $967 million ($600 of this amount, in his words, had been received by Raiffesen from accounts of Latvia’s Ukio Bankas that had also taken part in the scheme).
“I can confirm that our office received a report upon this issue, and it was examined. As there were no sufficient grounds for suspicion, no official investigation was carried out,” a representative of Austria’s Prosecution Service told RBC.
Earlier, the media office of Raiffeisen Bank International (RBI) told RBC that Raiffesen had carried out their inner investigation following the publication by OCCRP and the complaint by Hermitage. “Due to the lack of the particularities, the public prosecutor decided not to take steps related to the complaint received in March. RBI - among other banks - was mentioned in the complaint,” a representative of the bank told RBC on September 16. “Nevertheless, we carried out our inner investigation related to these accusations and once again became certain that our AML systems are strong,” she said.
“Austrian authorities refused to launch the investigation. We didn’t understand why,” a representative of Hermitage Capital told RBC. “16 other countries started the same investigations into money laundering.” Ruben Vardanyan refused to comment upon the matter.
What Troika was accused of
As a result of the leaking, the correspondents of OCCRP got an access to the data about more than 1.3 million bank transactions. According to the investigators, from 2006 up to 2013, $4.6 billion went through Troika Laundromat. The offshore companies opened their accounts in Lithuania’s Ukio Bankas and Estonia’s Danske Bank.
In their investigation, the correspondents described a few schemes the offshore firms of Troika were used for:
- fuel schemes in Sheremetyevo when tens of fly-by-night companies resold jet fuel to each other and did not pay more than $40 million of taxes;
- payment of $69 million to companies tied to a cellist Sergey Roldugin, a friend of the President Vladimir Putin - in the form of fees for unfulfilled contracts: Vardanyan said that his companies had not handles matters with Roldugin;
- granting of €14 million loans by companies of Troika to a pensioner Anna Kurepina in 2008-2009; Kurepina was registered in the same apartment with a former Governor of the Samara region Vladimir Artyakov; the pensioner spent money on a real estate on the coast of Spain’s Costa Brava; she sold it to Artyakov’s children in 2014; according to the investigation, she didn’t have to give back the loan, as the company that had granted it was eliminated; Vardanyan said that he could not remember of the loan given to Kurepina;
- $130 million were transferred to a network Troika Dialog by companies tied to a case of Sergey Magnitsky deceased in a Russian prison and Browder’s Hermitage Capital.
Response to the investigation
The investigation gave birth to new issues for investment banks. After the publication, shares of Raiffeisen Bank International fell by 10 per cent. American largest banks - Bank of America, Morgan Stanley and Citigroup - checked their clients’ accounts in the term of possible money laundering from Russia in spring.
Ruben Vardanyan stated that everything was messed up in the investigation: information that had been taken out of context, interpretations, and falsehood - round and green. “It is incorrect to estimate the activity of Troika out of historical, economical, and business context - and only measure it up with nowadays parameters,” he replied to the publications. At the present time, Troika Dialog does not exist: in 2012, Vardanyan sold the company to Sberbank, and it was reorganized as its investment subdivision - Sberbank CIB. In 2019, the bank united it with its corporate block due to the absence of the demand for service of an investment bank.
Banks mentioned in the investigation by OCCRP had earlier also been in the high light of corruption scandals. Denmark’s largest bank Danske Bank admitted that through its branch in Estonia, potentially suspicious transactions went through. They were worth of $230 billion from 2007 up to 2015. The United States Department of Justice, Great Britain, Denmark and Estonia’s Securities and Exchange Commission opened investigations against the bank. According to Bloomberg, from 2003 up to 2017, more than $889 million were received by Troika offshores from Danske Bank. The bank is in the center of the investigation in a case into ‘Panamian archive’.