Billions of pounds linked to Russian oligarch Alisher Usmanov and his business empire appear to have been held in secret Swiss accounts belonging to his family, according to an analysis of leaked documents.
Usmanov’s 56-year-old sister, Saodat Narzieva, appears to have been the sole beneficial owner of at least 27 secret corporate accounts at Credit Suisse, including one holding nearly 1.9 billion Swiss francs (CHF ) (£1.6 billion). Usmanov is under EU sanctions.
Narzieva is a gynecologist and obstetrician in a maternity hospital in the Uzbek capital, Tashkent.
His name is attached to Credit Suisse accounts that appear in Project Suisse Secrets, a data leak involving 30,000 clients of the Swiss bank. It’s unclear why his name would be linked to accounts associated with his brother’s business empire.
A spokesperson for Usmanov suggested the Credit Suisse data was ‘false and incorrect’ and that there was nothing untoward about his financial dealings with his sister, which were legal and indicative of his ‘generosity’ .
Information from numerous financial leaks, including Swiss Secrets, the Panama Papers and FinCEN Files, allowed Guardian reporters to highlight the immense wealth linked to Usmanov.
The revelations highlight the potential challenges Western governments face when sanctioning or freezing the assets of oligarchs.
The Russian Asset Tracker project included relatives and associates, as in some cases their wealth comes almost entirely from the person under sanctions. Including family gives a fuller picture of the extent of their fortunes, and in some cases they may have been used to hide or disperse assets.
Last month, the US Treasury highlighted ownership issues, saying: “Sanctioned oligarchs and powerful Russian elites have used family members to move assets and hide their immense wealth.
Usmanov was worth an estimated $18.4bn (£14bn) in 2021 when he was listed as one of the 100 richest people in the world by Forbes magazine.
When the Guardian first asked Usmanov about the links between Credit Suisse accounts showing his sister as a beneficiary and his business group on February 15, before Russia invaded Ukraine, he charged the London law firm Schillings to respond on its behalf. At the time, they said “true or false, a person’s financial information is private. We see no reason for our client to discuss financial transactions with journalists. Schillings did not respond when asked if the company still represents the oligarch.
Usmanov’s spokesman has since said that Narzieva does not “have possession or control of any accounts at Swiss banks in her brother’s name.”
“Any financial relationship of Mr. Usmanov with his sister would have been [the] result of his well-known generosity and the support he has always given legally to his loved ones,” they said.
His spokesperson added that “all of Mr. Usmanov’s businesses have been audited by the Big 4 [audit] businesses, since their inception, as well as their personal tax returns and expenses. All of its investments, expenses and revenues have gone through strict compliance procedures.
Usmanov, a businessman of Uzbek origin, has been subject to an assets freeze and EU travel ban since late February, after the bloc identified him as “one favorite oligarchs of Vladimir Putin” who allegedly paid millions to one of Putin’s influential advisers and was “entrusted with the management of financial flows”.
Usmanov accused the EU of “false and defamatory allegations” that “damaged his honor, dignity and business reputation”.
Sanctions have also been imposed on him in the United States and the United Kingdom, where he once held a 30% stake in football club Arsenal. Switzerland followed suit, abandoning political neutrality to match the EU’s efforts.
While Western governments have introduced sanctions against relatives of some Russian oligarchs, none of Usmanov’s family members have been included on any list so far.
According to documents in Swiss Secrets data, all 27 accounts at Credit Suisse that listed Narzieva as the beneficial owner were opened between 2004 and 2014, and 16 listed Usmanov’s metals, mining and telecommunications holding company, USM, as the contact. .
The largest of the accounts held almost CHF 1.9 billion in 2011, while two others held up to CHF 1.3 billion and CHF 460 million in 2014.
While a handful of accounts were closed in 2016, around 18 are believed to still be active in recent years. All assets were held in trading accounts, some of which are believed to be linked to offshore companies. Credit Suisse said it was unable to comment on the accounts due to Swiss bank secrecy laws and said it was applying all sanctions “as a matter of principle and policy”.
Narzieva’s brother made his fortune producing plastic bags, which were a rare commodity in the former Soviet Union, and later ran the holdings arm of Russian state gas company Gazprom from 2000 to 2014.
He has taken stakes in a range of metallurgical, mining, telecom and media companies through USM, which owns Russia’s second-largest mobile operator, MegaFon, as well as a 49% stake in Metalloinvest, the metallurgical company and Usmanov Mining founded in 1999.
A leaked Panama papers email cites Narzieva as one of several close relatives for whom offshore companies were set up in 2013 to hold shares in another Usmanov holding company, ABU.
The email, sent by the now defunct Panamanian law firm Mossack Fonseca, suggested that each of the so-called special purpose vehicles held bank accounts with Credit Suisse and another Swiss bank, Julius Baer. .
According to documents reviewed by the Guardian, a US bank raised suspicion of around $1.6 million in transfers made between accounts linked to Usmanov and his associates between 2003 and 2015, including via one of the accounts of the Credit Suisse naming Narzieva as beneficial owner.
The bank reported that there were suspicions on the grounds that the company at the center of the report – Usmanov’s Cyprus-based Gallagher Holdings – appeared to be a shell company which carried out “a significant amount of wires with many other screen entities”.
The Suspicious Activity Report (SAR) – filed in 2016 and later obtained by BuzzFeed and the International Consortium of Investigative Journalists – said the bank could not determine the purpose of some of the transactions.
The RAD added that it was concerned that “Gallagher appears to belong to people with links to Putin.”
Banks and other financial institutions file SARs with law enforcement agencies when they suspect a customer is using their services for potential criminal activity. However, SARs do not mean that a customer is guilty of wrongdoing or require a bank to stop doing business with the customer.
A separate SAR filed in 2017 suggested Usmanov was the original source of more than $2.5 million that Narzieva used to send money to a steel company boss in the Middle East in 2013.
According to the RAD, Narzieva appears to have passed the money to the Middle Eastern businessman shortly after Usmanov sent her sister a $3 million “gift”. She then returned at least $50,000 to Usmanov – which was related to “current expenses”, according to the payment reference.
This businessman was the boss of a joint venture created by Usmanov’s Metalloinvest in 2010. The bank said in the SAR that it could not establish the purpose of the wire transfer between Narzieva and the businessman. Middle Eastern business as they “seem to be engaged in different lines of business as a medical doctor and general manager of a steel company, respectively”.
Usmanov and Narzieva’s spokesperson did not explain the purpose of the transfer but said the Middle Eastern businessman was his son-in-law.
Usmanov’s spokesman said: “Mr. Usmanov’s entire capital has been built up through successful, sometimes risky investments, as well as efficient management of his assets, which is the essence of business.”
The representative also pointed out that, unlike other wealthy Russian businessmen, Usmanov did not make his fortune by acquiring newly privatized Russian assets after the end of the Soviet Union.
They added: “Mr. Usmanov has never acquired or benefited from anything from the Russian government, or that of any other state.”