Kremlin insider Arkady Rotenberg moved millions of dollars through one of Europe’s largest banks after the United States and EU sanctioned him, according to leaked documents published for the first time.
Rotenberg, a childhood friend of Russian President Vladimir Putin, conducted $60 million in transactions through a company called Advantage Alliance at Barclays from 2012 through 2016, the BBC reported on September 20, citing documents from an arm of the U.S. Treasury Department.
Many of the transactions occurred after the United States and EU sanctioned Rotenberg in 2014 following Russia’s illegal annexation of Crimea. The U.S. Treasury Department has also sanctioned Rotenberg's brother, Boris, and son, Igor.
The sanctions are meant to punish members of Russia’s inner circle and sever them from the international financial system.
Barclays closed the Advantage Alliance account in late 2016 but another alleged Rotenberg account at the bank, Ayrton Development Limited, remained open until 2017.
In July, a U.S. Senate investigation alleged the Rotenberg brothers used purchases of luxury art to evade sanctions. Among the companies involved was Advantage Alliance.
Rotenberg has gone from an obscure businessman in the 1990s to a billionaire during Putin’s 20 years in power. He has made most of his money through contracts with the state or state-owned companies.
The information about the Rotenberg accounts were contained in a trove of 2,100 documents leaked from the Financial Crimes Enforcement Network (FinCEN) to BuzzFeed, which shared them with the International Consortium of Investigative Journalists and more than 400 journalists around the world.
News agencies that took part in the investigation began publishing stories tied to the leaked documents on September 20.
The trove of documents indicates that over the period from 1999 to 2017 global banks moved more than $2 trillion in payments they believed were suspicious, raising questions about whether financial institutions and governments are doing enough to stop illicit money flows.
The documents show how major banks, including JPMorgan and Deutsche Bank, helped criminal networks around the world move and hide money.
The FinCEN documents consist of Suspicious Activity Reports (SARS). Banks file SARS with FinCEN when they have concerns about the legality of a transaction.
It represents at least the fifth major leak over the past six years exposing the depth of global corruption.
In half of the FinCEN reports, the banks didn’t have information about one or more entities behind the transactions, raising concerns about lax enforcement by financial institutions.
The U.S. and other governments have passed legislation in recent years that puts more pressure on banks to clamp down on illicit flows or face hefty fines.
Global banks filed more than 2 million SARS last year. FinCEN, which has 333 employees, is understaffed and underfunded for the fight against corruption, analysts have said.
The news organizations working on the FinCEN documents plan to publish more stories in the coming days about who else was behind suspicious financial flows.
The FinCEN dump is the latest breach of secretive global financial records since the 2017 leak of documents from Appleby and Estera, two offshore legal and corporate service providers.
Known as the Paradise Papers, they revealed the offshore financial dealings of politicians, celebrities, and business leaders.
