Cypriot authorities ordered local banks to stop all transactions in rubles and limit dealings with customers from Russia. reported Politis newspaper. The country also began to control law firms that provide accounting services, help Russians obtain residence permits, provide tax deductions, and also help quickly register a business.
According to the publication, such measures were taken based on the fact that the United States sent a special group of FBI and Financial Crimes Enforcement Agency (FinCen) employees to Cyprus. They, together with the republic’s authorities, will consider in detail 29 cases of circumvention of anti-Russian sanctions.
Cyprus Confidential
Cyprus Government he is writing Lenta.ru decided to ban transactions in rubles in order to restore the country’s business reputation. The blow to him was the International Consortium for Investigative Journalism (ICIJ) report called Cyprus Confidential. published In November 2023. It is based on the leak of more than 3.6 million documents from Cypriot companies. In the files, journalists found information about companies that help Russian entrepreneurs manage their assets, including in circumventing sanctions.
According to ICIJ, the services of these companies were used by the majority of Russian billionaires on the Forbes list. In fact, 650 trusts were directly registered or controlled by Russians that were subject to sanctions in 2014.
Kıbrıs Posta newspaper also quoted the documents in the ICIJ report WrotePricewaterhouseCoopers’ Cyprus branch said its employees played a role in circumventing anti-Russian sanctions. They allegedly helped Alexey Mordashov, CEO of the Severgroup holding, transfer €1.4 billion to a trustee account.
In addition to Mordashov, the report also included the names of Roman Abramovich and his partners Alexander Abramov and Alexander Frolov, as well as former board member of Alfa Bank Pyotr Aven.
Close accounts
Even before the Cyprus Confidential report was published, Bank of Cyprus, Cyprus’ largest bank, had sent notices to its Russian customers that their accounts would be closed. reported Forbes. They promised to block the accounts within two months. The reason for the closure may be tax residence in Russia, the presence of income from a sanctioned business and the “wrong” type of residence permit. reported Law firm Main Trust Partner on the Telegram channel.
According to the company, the bank may have made such a decision due to concerns about British and American sanctions.
In the Bank of Cyprus itself reported Forbes reported that they decided to close the accounts of Russians in connection with the suspension of Russia’s membership in the Financial Action Task Force (FATF).
The bank also confirmed that the blocking decision would affect approximately four thousand Russians who do not reside in the European Union.
On April 12, the USA and the UK expanded their sanctions lists. Among them were 23 Cypriot passport holders, only 10 of whom were born on the island. The new figures were thought to be trying to circumvent Western sanctions. Companies called “financial intermediaries” of Russian businessmen were also included in the updated list. reported Kıbrıs Posta newspaper.
Following this, the President of Cyprus held an emergency meeting with the participation of the Attorney General, the Minister of Finance, the head of the Ministry of Foreign Affairs and the representative of the Central Bank of the Republic. In the last statement made after the meeting, it was stated that the president considered the issue of including Cypriot citizens and companies in the sanctions lists to be particularly serious.
Commenting on the closure of accounts, financial analyst Giorgos Georgiou said:stated The Alphanews portal states that the republic’s economy is at the end of the “golden age” of the Russia-based service sector.