Millions of dollars laundered in hotel construction for 2018 FIFA World Cup
In the closest time, Hyatt Regency Rostov Don-Plaza hotel may be crossed off from the list of infrastructure facilities of the FIFA.
Rostov-on-Don filed a criminal case against the management of the company, which is the operator of the hotel construction as part of preparation for the 2018 FIFA World Cup. As Kommersant writes, the investigators suspect that the businessmen funneled the budget funds allocated for the construction of Hyatt Regency Rostov Don-Plaza abroad. So far the case is consisted of only one episode, the damage in which the investigators estimate at 5.6 million rubles ($94.6 thousand). At the same time, the prosecutor's office is conducting a check on the possible withdrawal of VAT refunds to the accounts of the affiliates of MKC-Rosevrodevelopment LLC management amounting to more than 110 million rubles ($1.8m).
The case under part 4 of Art. 159 of the Criminal Code (Swindling on an especially large scale) was instituted against the management of company MKC-Rosevrodevelopment LLC. This company is engaged in the construction of the hotel. According to the investigators, in September 2013 State Corporation Vnesheconombank (VEB) provided the businessmen with 3.1 billion rubles ($52.3m) for the construction of Hyatt Regency Rostov Don-Plaza. Only 2.6 billion rubles ($43.9m) of them were spent. Under the terms of the loan agreement, the borrower was obliged to submit quarterly information to the tax inspectorate and VEB for VAT refunds, so that these funds could then be used to build the hotel or pay off debt and interest to Vnesheconombank. However, during the period from May 2015 to February 2016 the company's management transferred funds received from the state budget to the accounts of Intourist OJSC, Victoriya-2000 LLC, Bon-appetite LLC. These companies, the investigators believe, affiliated with the leadership of MKC-Rosevrodevelopment laundered roughly 100 million rubles ($1.6m), which were subsequently returned almost in full to the company's accounts.
In addition, the company has arrears in wages to employees in the amount of over 3 million rubles ($50.7 thousand), another 3 million rubles ($50.7 thousand) are debts on personal income tax and the same amount – on insurance premiums.
There are two offshore companies behind MKC-Rosevrodevelopment: Bekaert Limited (38.2%, Virgin Islands) and Malbakinvestmentslimited (17.3%, Cyprus). Another 44.5% belongs to Russian company Feretti LLC. Until May 2017, it was owned by Rostov businessmen Igor Gorin and Andrey Demishin. Now the share of 67%, owned by Gorin, went to Anna Agrest - the daughter of businessman Vadim Varshavsky. His wife - Elena owns 45% in Russian National Bank LLC. The bank is one of the creditors of the Don-Plaza Group of Companies, implementing the Hyatt project.
As reported by Delovoy Rostov (Business Rostov) with reference to sources, in order to repay the main debt, the investors offered the bank a stake in MKC-Rosevrodevelopment. Ultimately, the co-founder was the daughter of Varshavsky, who de jure has nothing to do with the bank. The signing of the agreement opened the floodgate to the opening of financing by Vnesheconombank.
The filed criminal case, in Demishin's opinion, is attempts to press on the business and impede the project implementation. However, at a meeting of the region's administration with the investors and participants of the Hyatt Regency Rostov Don-Plaza construction project on November 10, it was decided to petition the government to strike the project off the list of FIFA infrastructure facilities. Initially, the facility commissioning was planned for 2009, later the deadlines were shifted several times. The cost of the project for the period of implementation mounted from 4.4 billion ($74.3m) to 6.5 billion rubles ($109.8m).
The ICR has reported on solving the murder of Ilya Pichko, who had been due to testify in the high-profile case of smuggling at the hearing on December 18. The search for the head of Yugo-Vostochnaya Torgovaya Kompaniya began after he failed to appear at the hearing scheduled for December 11.