Companies linked to Russian billionaire Roman Abramovich may have used documents drawn up retrospectively to transfer assets to offshore structures and reduce tax liabilities in Cyprus. The Cypriot office of international audit firm Deloitte was also involved in preparing the documents.
HOW THE SCHEME WORKED
According to an investigation by OCCRP, Deloitte Cyprus worked with MeritServus, which managed Abramovich's corporate structures, and employees of investment company Millhouse.
In the mid-2000s they discussed how to draw up documents so that the assets appeared to have been transferred to companies in the British Virgin Islands back in 2003. This would have made it possible not to disclose part of the property in Cypriot financial statements and to reduce taxes.
WHAT ROLE THE SALE OF SIBENEFT PLAYED
One episode concerns Kravin Investments Limited, which in 2003 received around $3 billion after Abramovich sold 20% of oil company Sibneft.
In 2005, representatives of Deloitte Cyprus, MeritServus and Millhouse discussed how to present this money in the documents as funds belonging to an offshore company. Kravin's financial statements for 2005 state that in 2004 it held $870 million on behalf of its parent company in the British Virgin Islands.
At the same time, journalists were unable to independently confirm that the arrangement to re-register the funds was implemented in exactly the way discussed in the correspondence.
WHICH ASSETS WERE HIDDEN IN THE STATEMENTS
Another episode relates to Amiscan Investments Limited. According to a draft financial statement for 2003, it owned yachts worth $354 million, aircraft worth $142 million and four properties in France and the United Kingdom with a total value of $127 million.
The correspondence discussed the transfer of subsidiary companies to the offshore structure Kelvedon Worldwide Limited. The documents were drawn up so that the deal appeared to have taken place back in January 2003. In Amiscan's statements for that year, which Deloitte Cyprus reviewed in December 2006, the value of the company's assets was stated as zero.
WHAT ABRAMOVICH AND DELOITTE SAID IN RESPONSE
Representatives of Abramovich said that he was unaware of the preparation of documents retrospectively, did not approve it and did not take part in the process. They also rejected allegations of tax evasion, explaining that the companies relied on professional advice from Deloitte and other specialists.
Deloitte Cyprus said that the company complies with applicable legislation, but declined further comment. Representatives of the office explained that they no longer have access to correspondence from twenty years ago.
WHAT IS KNOWN ABOUT THE INVESTIGATIONS
The United Kingdom imposed sanctions on one of MeritServus's structures and its head, Demetris Ioannides, in 2023. The country's authorities linked their activities to the creation of opaque offshore structures.
In addition, a separate criminal tax case is continuing in Cyprus against the legal structure MeritServus, two former employees of the company and the firm Blue Ocean Management Limited, which managed superyachts. Blue Ocean is accused of failing to pay more than €26 million in taxes and accrued interest.
Abramovich also remains a subject of a Jersey authorities investigation on suspicion of money laundering linked to the sale of Sibneft. His lawyers deny the allegations and state that no charges have been brought against him in this case.
