Spanish 'laundromat' of Russian mafia. Part I 

Spanish 'laundromat' of Russian mafia. Part I
Witnesses testify in court about money laundering operations of 'Russian mafia' in Spain Photo: The CrimeRussia

Ten years after Operation Troika, a trial of so-called ‘Russian mafia’ has commenced in Spain. The supreme leaders of Tambovsko-Malyshevskie organized criminal group that had laundered in Spain criminal proceeds from Russia are not among the defendants. However, two suspects have already provided confessions and told the investigation about the schemes used to launder criminal capitals.

On June 12 and 13, 2008, 20 Russian natives have been arrested in Spain in the course of a large-scale special operation dubbed “Troika”. Leonid Khristoforov, Aleksander Malyshev, Gennady Petrov, Yuri Salikov, Yulia Smolenko, thief-in-law Vitaly Izgilov, and other detainees were charged with money laundering, weapons trafficking, contracted killings, extortion, drug dealing, forgery of documents, smuggling, corruption in the top echelons of the Russian power, and sales of connections.

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Aleksander Malyshev

«The defendants have created what is known in the Russian criminal world as “a criminal community”; then their leaders, the current defendants, decided to settle in Spain, in quite conditions, where their operations were not known, and establish and relocate their bases used for large-scale planning of knowingly criminal operations bringing enormous profits,» – the case file states. 

The Spanish law enforcement authorities believe that despite its name, Tambovsko-Malyshevskie organized criminal group had been controlled in Spain by Gennady Petrov, not Aleksander Malyshev. The indictment does not specify the rule of well-known thief-in-law Vitaly Izgilov also known as Zver (Beast). It is only known that in late September 2015, the crowned thief has returned to Russia after serving a prison term in Spain in the framework of the criminal case against thief-in-law Shakro Molodoy.

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Vitaly Izgilov (Zver)

The rank of Gennady Petrov in the criminal hierarchy is described as follows:

Petrov (also known as Gennadios Vasilevich Petrov) is the "chief" of a criminal group having a clear pyramidal structure. Other gang members are under his ferule. They had named him "chief", "boss", "leader", or "principal". In the framework of his functions, Petrov had maintained close ties with representatives of the Russian political, economic, judicial, and police authorities, as well as with members of the international organized crime with the purpose to implement joint projects. With the assistance of lawyers, managers, and confidants, he has created in Spain a network of companies in order to cash out monetary funds obtained by the criminal group. In Russia, he maintains close ties with high-ranked officials in the political, criminal, and law enforcement spheres.

The Spanish investigators believe that Tambovsko-Malyshevskie organized criminal group has several leaders; each of them has his own functions and responsibilities and manages the operations using his henchmen. Sometimes, lower-ranked gang members interact with each other, but all of them have sustainable links with their bosses. The hierarchical structure puts the leaders in line, but the figure of Gennady Petrov seems to be more powerful.

Геннадий Петров, Александр Малышев

Gennady Petrov and Aleksander Malyshev

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Aleksander Malyshev (has an ID in the name of Alexander Lagnas Gonzalets, an Estonian citizen residing in Berlin) is known as the creator of a major criminal group named “Malyshevskie”. In 1980, after serving two prison terms, started working on Sennoy market in Leningrad under the cover of Tambovskie organized criminal group. Then created his own group uniting under his leadership brigades operating throughout Russia. The gang’s peak of activity was in 1991–1992. At that time, the gang leader was often named “the emperor of lawless Petersburg”. After serving terms for various crimes, Malyshev and Petrov have relocated to Spain.

In addition to Malyshev and Petrov, Sergei Kuzmin is considered a leader of this criminal group. His henchman Mikhail Rebo made a plea deal and admitted in court the laundering of criminal proceeds from Russia in Spain.

Mikhail and Tatiana Rebo 

Mikhail Rebo resided with his wife in Germany and represented the interests of the criminal groups in German companies. He had often run errands not only for Kuzmin, but for Aleksander Malyshev as well. For instance, in a telephone conversation dated October 15, 2007, Rebo had requested from Malyshev instructions how to handle revenues generated by a restaurant in Moscow. 

Assignments given to Rebo included signing deposit agreements and renting safe deposit boxes for unidentified terms. 

In 2005, Rebo was in control of accounts of Cyprus-based Kingdra Ltd. and SBZ Investment Ltd. SBZ Investment Ltd. was incorporated in 1997 in Nicosia with the purpose to conceal final beneficiaries and exclude the possibility to reconstruct financial operations documentarily. The company was, in fact, managed by Gennady Malyshev and his wife Olga Solovieva. Its nominal director was Malyshev’s mother-in-law Tatiana Solovieva, while Sergei Bochishchev, Nina Bochishcheva, and Anna Bochishcheva were its nominal owners. It is necessary to note that SBZ Investment Ltd. is the main company referred to in the money laundering criminal case.

According to the case file, the main operations were performed not by Mikhail Rebo – but by his wife Tatiana. He was a Deputy Director of the Berlin Branch of Parex Bank and handled money transfers between companies controlled by Kuzmin and his partners. However, no charges were laid against Tatiana Rebo and she is not among the defendants. 

The investigation has uncovered a money laundering operation involving SBZ Investment Ltd. – the scheme included an increase of the company’s charter capital. To do so, on April 25, 2005, BBVA Banking Group has granted a loan in the amount of €400 thousand secured by a share in an investment fund to Malyshev’s wife Olga Solovieva. On the same day, SBZ Investment Ltd. received a money transfer from Bank of Cyprus Public Company de Nicosia in the amount of €400 thousand with a reference: “community involvement”. A few weeks later, two money transfers totaling €400 thousand and addressed to SBZ Investment Ltd. via Bank of Cyprus Public Company de Nicosia have been received by BBVA Banking Group. 

After making several money transfers between various bank accounts, the wife of the ‘Russian mafioso’ hoped to be able to explain the increase of the charter capital of SBZ Investment Ltd. to third parties (e.g. tax authorities) by a bank loan and conceal the rest of this operation. The investigation believes that the initial sum of €400 thousand was obtained through criminal operations of the gang. 

In the course of Operation Troika, two safe deposit boxes in Deutsche Bank Privat- und Geschäftskunden AG used by Mikhail Rebo have been searched. Jewelry worth in total €900 thousand and €19 thousand in cash were found there. The Spanish investigators believe that the valuables have a criminal origin related to operations of Tambovsko-Malyshevskie gang.

Another company involved into the money laundering was Peresvet S.L. The Spanish authorities consider it the main company used to legalized criminal proceeds through real estate investments.

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Peresvet S.L. was incorporated on July 27, 2000 in Málaga, Spain. Its declared principal activities are real estate transactions and construction. Its charter capital is €1,293,540. The company has been founded by Olga Solovieva and Leocadia Martin Garcia (owning one nominal share worth €1). Later the company owners and their shares were changed many times. Olga Solovieva was the Director of Peresvet S.L. The company owns 61.10% of shares in Cyprus-based Kingdra Ltd. also belonging to the Malyshev family.

Mikhail Rebo has confirmed that funds were laundered via Spanish company Peresvet S.L. and Cyprus-based Kingdra Ltd. SBZ Investment Ltd.

Leonid Khazin 

Defendant Leonid Khazin has also made a plea deal. According to the investigation, he was the nominal director of dummy companies controlled by Sergei Kuzmin. Inversiones Finanzas Inmuebles SL had played the key role in his legal and financial machinations.

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Sergei Kuzmin was the Director of Inversiones Finanzas Inmuebles SL up until 2003. The company had managed several Spanish firms affiliated with Kuzmin: Tomillo Inversiones SL, Casasol Investment SL, Namur Properties SL, Louis Properties SL and Ken Espanola, de Inversiones SL. Inversiones Finanzas Inmuebles SL hadn’t run any economic activities; its sole purpose was to manage the above-mentioned legal entities having ties with companies – residents of Panama.

Khazin had owned MYR Marbella SL used to acquire shares of various companies affiliated with Kuzmin. Khazin had signed fictitious service and commission agreements between Inversiones Finanzas Inmuebles SL and other Spanish companies belonging to Sergei Kuzmin. In addition to sham contracts to render non-existent services, dummy companies had received at least 5% commission from operations that were never performed.


Money transfers between interrelated companies

Francisco Eloy Ocaña Palm, a nominal employee of Inversiones Finanzas Inmuebles SL, was involved into this scheme as well. He had also acted as a representative of British company Virginia Ventures Ltd. incorporated in the British Virgin Islands. 

In other words, he had received monthly wages and commission from sales of his assets. The purpose of these operations was to legalize the money received under service contracts whose beneficiary was Sergei Kuzmin.

Геннадий Петров и Сергей Кузьмин

Gennady Petrov and Sergei Kuzmin

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Sergei Kuzmin has met Gennady Petrov for the first time in a Russian prison. In 1998–1999, they were co-owners of Rossiya Bank. According to the minutes of shareholder meetings held in 1998–1999, each of them had directly owned 2.2% of shares in the bank.

On September 13, 2005, Sergei Kuzmin has sold his share in Inversiones Finanzas Inmuebles SА to Kirill Yudashev, a representative of Russia-based Altair Trade, for €2,408. After that deal, Sergei Kuzmin has severed ties with the Spanish company leaving Leonid Khazin and Altair Trade its sole shareholders. The investigators believe that the transfer of the company’s shares was needed to severe ties between the Panamanian and Spanish companies and cover up the traces leading to Sergei Kuzmin. 

According to the investigation, Leonid Khazin had represented the interests of Sergei Kuzmin in Spain and managed his companies – therefore, Khazin possesses the full information about the corporate network created by Kuzmin. Numerous documents confirming this were found during searches, including invoices of Panama-based Sandorella Real SA. The investigators have noted that the payment for his services for the year of 2002 in the amount of €40 thousand was made by that company, not by Spanish companies – clients of Khazin. 

For instance, Sandronella Real SA had transferred funds totaling €390.1 thousand to Kost de Inversiones SA in 2002, 2005, and 2006 – although there are no legal relations between the two companies explaining these money transfers. The investigators believe that the source of financing of Sandronella Real SA originates from a money transfer in the amount of €370 thousand received from Tomillo de Inversiones S.L. in 2002. The official purpose of this transfer was a “loan repayment”. In 2001, Tomillo Inversiones S.L. has increased its charter capital by some €800 thousand using for that purpose funds provided by Sandronella Real SA as the repayment of a loan of the same amount granted to it earlier.

Геннадий Петров, Иида Масамичи (якудза) и Александр Малышев

Gennady Petrov, Iida Masamichi (Yakuza) and Aleksander Malyshev

The transfer to an offshore company was made by a Spanish company, thus, withdrawing the ‘dirty money’ from Spain; after the laundering and legalization, the funds have ended up in an offshore territory. 

Two money transfers from Casasol to Sandronella Real SA made in 2006 and totaling €140 thousand have no logical reasoning as well. The only possible explanation is that the both companies belonging to Sergei Kuzmin constitute together a ‘treasury’ used to conceal capitals by making numerous money transfers between various accounts.

Khazin told the investigation about a money laundering scheme involving companies incorporated in Spain, U.K., Panama, and Liechtenstein.

In exchange for his confessions, Mikhail Rebo agreed to be punished by two years behind bars and a fine of €1.6 million. The Prosecutor’s Office has offered Leonid Khazin a punishment of 1 year, 7 months, and 15 days in jai and a fine of €26 thousand. 

The prosecutor intends to question Yuri Salikov, an active member of Tambovskie organized criminal group, in the nearest future. Salikov is a partner of Gennady Petrov in at least two companies. Russian Deputy Vladislav Reznik – considered another active gang member by the Spanish authorities – hopes to be fully acquitted by the court. Defense attorneys for Reznik claim that the charges laid against their client are wrongful and based on poorly-translated records of telephone conversations.

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Photo from the courtroom

The CrimeRussia will continue monitoring this trial.

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