Article by Kevin Holland, photo by Good Free Photos
It is estimated between $20bn – $80bn of illicit funds was moved from Russia in the laundromat scandal. Most was moved into Europe.
It involved over 5,000 companies, most of which were bogus, it involved over 700 banks, and many EU states. Danske bank in Estonia was a renowned hub.
Ruslan Rostovtsev has now been named a key player in the scandal. A former mayor of Sochi, his mining operations have brought him considerable wealth. New reports claim his UK company, Grandwood Systems Ltd, moved around $400m.
A court in Cyprus has now issued an asset freeze against him, preventing further movement of illicit funds.
Papers from UK courts suggest he also moved ovewr £1m from Cyprus alone, and as much as $50m through Trasta Komercebanka in Latvia. Trasta was deeply mired in the laundromat scandal and was duly closed down by the government.
The report also mentions Rostovtsev’s focus on Donetsk, the region annexed by Russia. He moved money for a number of people and organisations from the region, and seemed to enjoy close relations with the state. He was given a formal award of recognition from the Ministry of Foreign Affairs in 2018.
In May 2018 a report by the UK’s House of Commons Select Committee on Foreign Affairs made clear the laundromat should be a ‘major priority’ of UK foreign policy. It also lamented the seemingly lax approach of UK authorities who no doubt were keen to protect London’s lucrative role in money laundering the world’s money. All the UK’s major high street banks were involved.
There will be concerns in Europe that the UK is dragging its feet over money laundering because London brings in such vast sums of illicit money.
All considered, it is surely time the EU got tough with Britain and, in particular, the archaic City of London which is deeply implicated in much of the world’s money laundering.